In the latest Cabinet reshuffle, Piyush Goyal assumed charge as the new Railways Minister, while his power portfolio has a new incumbent in Ravi Kumar Singh. Goyal’s appointment as the railways minister is aimed at turning around the railways sector, whose image has taken a battering following the spate of serious accidents in recent history. There is all-round hope that Goyal will effect a significant transformation in the railways sector, based on his track record in the power sector.
Piyush Goyal assumed charged as the power minister with additional charge of coal and renewable energy, in May 2014. It must be admitted that in Goyal’s tenure, the power sector changed much, and very positively at that. What is most noticeable in Goyal’s approach was that his ministry looked not at just the power sector, but its adjacencies. The key areas in which he strived were ensuring coal supplies to starved thermal power plants, providing impetus to solar energy, and addressing demand-side management (DSM) issues by championing the cause of LED-based energy efficient lighting.
Coal
When the new government assumed charge, most thermal power plants were working with a seven-day coal inventory, in the best case. Today, coal shortages are history. Coal India’s performance in recent years has been its best ever. This is perhaps why Goyal still retains the coal portfolio.
Renewable push
During Goyal’s tenure, solar targets were substantially hiked from 20 GW by 2020, to as much as 100 GW by 2022. How much of this target is actually realized is another matter, but the intent of the government in promoting clean energy is very evident. When the government realized that 40 GW (out of the total 100 GW) could not come from rooftop solar plants (as originally envisaged), it was planned that 20 GW should be added from grid-connected solar power parks. There has thus been a continual relook at policies so that the overall target of 100 GW by 2022 does not remain on paper. During his last few weeks as power minister, his intervention ensured that due to rapidly falling solar tariffs, state distribution companies do not attempt to “bully” solar power developers by dithering on their old power purchase agreements, signed at higher tariffs.
LED lighting
His work in the area of promoting LED lighting is commendable. Thanks to huge government procurement, and that too through transparent modes, LED lighting prices have fallen to highly affordable levels. LED manufacturers are in a position to offer their rock-bottom rates for LED bulbs because there is complete transparency in procurement. Gone are the days when suppliers had to keep some “provision” for “government-related” transactions.
E-business
E-procurement and e-bidding have transformed the way power utilities handle their contracts. As one leading power T&D EPC contractor told T&D India in an interview, it was a normal state of affair for a contractor to visit the power utility’s office to “get” the contract. But today, it comes almost as a shock that contractors are notified over email about their contracts. The so-called “personal rapport” between contracting firms and utilities is phasing out.
Private sector engagement
One of the areas that Goyal apparently did not press on was private sector involvement in the power sector, especially in power transmission and power distribution. In several press conferences, Goyal insisted that private sector participation is not the precursor to efficiency. He believed that to become efficient, one needs a change in state of mind, and he was confident that government-owned power distribution companies had the inherent capability to move towards techno-commercial efficiency. Talking of Goyal’s reforms in the power distribution sector, one must acknowledge that the UDAY (Ujjwal Discom Assurance Yojana) scheme aimed at reviving ailing government power distribution utilities, is perhaps the most striking of all policy measures in the power distribution sector, in India’s history.
Extending power to railways
Even while he is railway minister now, there are some linkages with the power sector that he can pursue. Expediting railway electrification works, encouraging the role of dual-mode locomotives (that work on both electric and diesel-traction) and the accelerated adoption of LED lighting are some of the several areas that power sector-related contractors and equipment suppliers can explore in the railways business. It is heartening to learn that dual-mode transformers that will be used in dual-mode locomotives are going to be supplied largely by Indian suppliers, thereby reinforcing the Make in India movement.
Now with Piyush Goyal holding both the coal and railways portfolio, it is fair to assume that coal rakes will reach pithead power plants only faster!
(Piyush Goyal’s image sourced from http://sustainabilitynext.in)
(This article’s author, Venugopal Pillai, is Editor, T&D India. Views expressed here are personal. The author may be contacted on venugopal.pillai@tndindia.com)