In an exclusive interview to The Sunday Guardian, Lalnunmawia Chuaungo, Principal Secretary in the Energy and Petrochemicals Department of the Government of Gujarat, spoke his mind on a variety of issues. Excerpts:
Q. Perhaps the biggest success story emerging out of Gujarat in the past few years has been the way Gujarat has become a power surplus state. It is a role model for other states in the country as far as power self-sufficiency is concerned. What specific role has the Gujarat Urja Vikas Nigam Ltd (GUVNL) played in this rapid transformation that Gujarat has seen as far as power sector reforms are concerned?
A. Prior to unbundling, the state was facing approximately 19% shortage of power in terms of capacity and 10% in terms of energy. The state government started implementation of the Jyoti Gram Yojana (JGY) in 2004 after successful implementation of pilot projects and completed implementation by 2006. Under JGY, rural feeders were bifurcated into Agriculture Feeders supplying improved but regulated electricity for irrigation and Village Feeders supplying 24x7 three-phase power to villages for all other uses. The scheme was closely monitored and successfully completed in 2006. The JGY enabled the state to manage the load in a manner that load-shedding became a thing of the past even in villages by the end of 2006.
The state also started aggressive generation capacity addition programme by being the first state in the country to tie-up long term power requirement through tariff-based competitive bidding by using the standard bid documents prepared by the Government of India. GUVNL tied up 3200 MW through tariff-based competitive bids carried out during 2006 at levelised tariffs ranging from Rs 2.25 to Rs 2.89 per kwh. All these plants were commissioned by 2011-12. Moreover, GUVNL also tied up 1805 MW power from Mundra UMPP from which supply of power commenced from March 2012.
The GUVNL also tied up power through Central sector generating plants, state PSUs, and renewable power through various public and private sectors. GUVNL has also put focus on renewable energy sources and increased the power purchase from wind generation from 186 MW in 2005 to 3953 MW at present. Moreover, Gujarat was the first state in the country to tie up huge quantum of solar capacity in 2010 and now GUVNL is purchasing 861 MW power from solar projects. As a result of all such measures, the state has 25192 MW installed capacity (20081 MW from conventional source and 5111 MW from renewable sources) as against the installed capacity of 8947 MW in 2005 Through advance planning, the state has become power surplus and is able to tie up power at competitive rates.
Q. GUVNL, as a holding company, is engaged in the business of bulk purchase and sale of electricity, supervision, coordination and facilitation of the activities of its six subsidiary companies, only one of which — the Gujarat State Electricity Corp. Ltd (GSECL) — is involved with generation of electricity, while all the others are involved in transmission and distribution. Don’t you think at least one more company should have been involved in the generation of electricity per se as that would have helped in generation of more power?
A. In order to meet the future power demand, the state government has set up various State-Owned Generating Companies by way of contribution from various state PSUs. These State-Owned Generating Companies are Gujarat Industries Power Company Ltd. (GIPCL-810 MW), Gujarat State Energy Generation Ltd. (GSEG – 507 MW), Gujarat Mineral Development Corporation Ltd. (GMDC–250 MW), GSPC Pipavav Power Company Ltd. (702 MW) and Bhavnagar Energy Company Ltd. (BECL–500 MW).
Further, the Gujarat State Electricity Corporation Ltd. (GSECL) had initially set up the power plants of Gandhinagar-Unit-5, Wanakbori-Unit-7 and Utran GBPS and Dhuvaran CCPP as Government sector IPP.
Q.As a holding company, how successful has Gujarat Urja Vikas Nigam Ltd been in dealing with issues like electricity thefts, a social evil, and power losses during transmission and distribution, as these are some of the major issues troubling power utility companies in many other states in the country? Can you state any facts and figures to support the performance of the GUVNL as far as these major issues are concerned?
A. At the time of unbundling, the distribution loss of GEB was around 28% which has now been reduced to less than 15%. GUVNL is closely monitoring the vigilance activity of distribution companies by arranging various installation checking drives in high headed and theft prone areas. Every year, around 25 lakh installations are being checked.
Further, Special Police Stations have been set up in each distribution company to provide adequate protection to the checking squads during the checking drives and also enable expeditious lodging of complaint/FIR against the persons indulging in theft and also helps in faster investigation and prosecution of accused.
Q. Last year, Gujarat became the 10th state in the country to join the Centre’s UDAY (Ujwal DISCOM Assurance Yojana) scheme, an optional one, for the revival of debt-laden discoms and ailing state electricity boards. Under the UDAY scheme, states can reduce interest costs, improve operational efficiency and lower cost of power, thus ensuring power for all. Since Gujarat has already been a power surplus state for quite some time how, what was the need for the state to join the UDAY scheme, and how, according to you, things are changing/improving for Gujarat after joining the Centre’s UDAY scheme?
A. State utilities have undergone a turnaround since 2005 and have been making profit continuously. However, the UDAY Scheme also aims at further improvement in operational efficiencies and therefore, the objective of joining UJWAL Discom Assurance Yojana (UDAY) is to have further improvement in operational efficiency.
Q. The erstwhile Gujarat Electricity Board (GEB) had been incurring losses till it was reorganized from 1 April 2005 into seven companies, including the GUVNL. Does GUVNL still feel the burden of losses incurred by the erstwhile GEB though GUVNL itself has been profitable for many years now?
A. While unbundling, several measures were taken through a FRP (Financial Restructuring Plan) under which financial and fiscal support were provided by the state government subject to achievement of specified performance targets by GUVNL and its subsidiary companies. Financial re-engineering were also carried out. As GUVNL and subsidiary companies met the performance targets, the past losses did not weight down their functioning or performance.
Q. Out of your subsidiary companies, the GSECL is engaged in generation of electricity, the Gujarat Energy Transmission Corp. Ltd. (GETCO) is engaged in transmission of electricity, while the others viz. Uttar Gujarat Vij Company Ltd. (UGVCL), Dakshin Gujarat Vij Company Ltd. (DGVCL), Madhya Gujarat Vij Company Ltd. (MGVCL) and the Paschim Gujarat Vij Company Ltd. (PGVCL) are engaged in distribution of electricity in Northern, Southern, Central and Western areas of Gujarat respectively. Does Gujarat Urja Vikas Nigam Ltd. (GUVNL) concentrate on generation and distribution of electricity only within Gujarat or has it also thought about exporting the surplus power generation to states which are power deficient and desperately need to import power from outside sources/states?
A. The main function of GUVNL is procurement of bulk power for and on behalf of its subsidiary Distribution Companies and after meeting the demand of the consumers of the state, GUVNL also endeavours to sell the surplus power either through bilateral arrangement or through Power Exchanges to other needy states. In the past five financial years, GUVNL has sold around 27,318 MUs and has been able to reduce the net power purchase cost of its Distribution Companies, and optimise the generation resources.
Q.Gujarat “Jyotigram Yojana”, an initiative started by Prime Minister Narendra Modi when he was the chief minister of Gujarat, is meant to ensure availability of 24-hour three-phase quality power supply to rural areas of the state and supply of power to farmers residing in scattered farmhouses through feeders having specially designed transformers. The scheme has been a huge success and the “Jyotigram Yojana” model is being replicated across many states in India. What has been the specific role of the Gujarat Urja Vikas Nigam Ltd. (GUVNL) in ensuring the success of the “Jyotigram Yojana” in the rural area of Gujarat?
A. The GUVNL played the role of coordination, monitoring and facilitation for implementation of the Jyoti Gram Yojana (JGY). GUVNL took care of centralised procurement of important materials of common requirement like distribution transformers, conductors, insulators etc and make them available to the distribution companies timely and in required quantity. This enabled implementation and completion of the JGY within the time prescribed by the Chief Minister.