CII urges government to build peak capacity level

As the power supply-demand scenario in the country worsens with hydel power projects running much below capacity in wake of poor monsoon, the Confederation of Indian Industry (CII) has urged the government to come up with a long term solution as the industry was crucial for India’s overall economic growth.

The government has been urged not to look for the 100-day agenda or the current year’s target as these were set to be missed and rather on the longer side should focus on solving the more fundamental issues which result in delays in the planned capacity generation targets and on the shorter side look for practical ways to minimise the impact of the power deficit through supply-demand management.

The CII said that since the peak time power deficit was soaring at 16%, government should come up with differential power pricing regime with higher price for power in the peak demand time. The industry body said that if the current projections are followed for the next decade, power shortfalls situation would become out of hands unless urgent steps were taken. The industry body said that the difference between base demand and peak demand is increasing and therefore building base load capacity alone will not be sufficient to address the power shortage. Instead, the government should focus on building peak power capacity and managing the peak demand through for example higher tariff.