The Prime Minister, Dr Manmohan Singh, wants to clinch the civilian nuclear deal with the United States in order to provide energy to meet the country’s growth requirements. This viewpoint is based on two beliefs. One, we need large amounts of power to sustain the 8 per cent-plus rate of economic growth. Two, it will not be possible to meet these requirements from other sources of power.
Both these beliefs do not stand on sound footing. The Central Electricity Authority established by Ministry of Power has estimated in the Seventeenth Electric Power Survey that we need to add 60,000 MW generating capacity during the Eleventh Plan. The Power Minister, Mr Sushil Shinde, has upped this to 80,000 MW. The hype is that we need this colossal amount of power to sustain economic growth. However, the record until now speaks otherwise.
The Economic Survey published by Ministry of Finance tells us that the average rate of economic growth was 5.9 per cent in 1997-02 and 6.9 per cent in 2002-06. We can extrapolate this trend to project a growth rate of 8.0 per cent, assuming that this acceleration in rate of growth will continue.
The consumption of electricity grew at 5.8 per cent in 1997-02 and 4.8 per cent in 2002-06. We may project a growth rate of 4 per cent if this deceleration in the rate of growth of electricity consumption continues.
In other words, we need to increase generation of electricity during the Eleventh Plan by only 4 per cent to sustain an economic growth rate of 8 per cent.
Our capacity for generation was 150,700 MW in 2006. Thus, we need to add only 32,650 MW capacity in the Eleventh Plan during 2007-12. The Central Electricity Authority is projecting a requirement of 60,000 MW without taking into consideration the declining requirement of electricity in sustaining economic growth.
Truly, we do not need even this amount of electricity. We must distinguish between requirement of electricity for economic growth and for consumption....