Friday 23 December 2011

India's economy is running out of POWER!

India's economy is running out of power. Separate the markets for base- and peak-load power consumption, says Shyam Saran.

22 December, 2011

Over recent weeks, reports of frequent and increasingly longer power cuts from across the country have added another layer of serious concern to India's faltering growth story.

What is unusual about these power outages is that they have been occurring during the months of October and November, when demand is traditionally low.

The immediate causes of the power crunch are well-known. There is a growing and acute shortage of coal, which is the mainstay of power generation in the country, accounting for over 50 per cent of overall capacity.

Over the past four years, demand for coal, mainly for thermal power generation, has grown by 7.3 per cent, while domestic output rose by only 5.4 per cent. In the next five years, the shortfall in the availability of coal is estimated at 200 million tonnes.

For article with slideshow GO HERE

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