The power crisis has taken us by surprise. The question in everyone’s mind is: where did we go wrong? And who slipped up? Clearly, there was complacency as the power supply position was comfortable for some years; there was ‘surplus’ capacity. Then there were stranded coal- and gas-based power plants which had become non-performing assets. It was, however, not appreciated that electricity demand growth had been lower than expected, due to slower and less energy-intensive economic growth. The robust economic recovery after two waves of COVID-19 and the unexpected heat wave have brought back power cuts. The Government is undertaking emergency measures such as cancelling passenger trains so as to be able to get the Indian Railways to transport more coal to power plants, and issuing directives to use more imported coal to tide over the supply shortfall.
Nature of consumer demand
Taking a holistic view of responsibilities in the supply chain would be helpful in avoiding such recurrences. Under the Electricity Act, it is the responsibility of the Distribution Licensee/Company (Discom) to provide reliable quality and round-the-clock electricity to all consumers to meet full demand. To do so, they enter into contracts with a number of generating companies in order to ensure adequate supply. These Discoms work under the oversight of the State Electricity Regulatory Commissions.
