Ending India’s energy drought

In most Indian cities, being middle class means owning your own power company. As summer temperatures approach 40 degrees Celsius (104 Fahrenheit), energy demand from electric fans and air conditioners is putting stretched utilities under stress.

Against a peak demand of 104,000 megawatts last month, supply was 90,000 megawatts. That is a shortfall of 14 percent.
Rationing of power, which goes on throughout the year, becomes unbearable during the summer months. People resign themselves to blackouts that sometimes last all day, even longer if overburdened cables burn or aging transformers collapse.

Households and businesses create their own electricity by burning diesel in noisy, inefficient, polluting generators. Those who cannot afford to be power producers buy inverters: chargeable batteries that store power from the utilities for later use.

Businesses have it worse.

An nationwide survey of small enterprises in 2002 cited power shortages as one of the top reasons for industrial sickness, far ahead of labor strife or mismanagement.

Why has India allowed itself to get into this mess?

At the end of last year, China had 622,000 megawatts of generation capacity. A fifth of this – almost equal to India’s total capacity built up over decades – was added in 2006 alone.

Why does India not invest more in energy, which is emerging as a major bottleneck for sustaining the current pace of 9 percent annual economic growth?

The seed of India’s power crisis was sown in 1977. That was when politicians first came up with the idea of subsidized electricity for farmers to win their votes. Then free power for agriculture became the norm, pushing state-run electricity boards into financial ruin.

International Herald Tribune