Minister of State (I/C) for Power,

Coal and New & Renewable Energy

Government of India

Message
Dear fellow citizens,
The NDA government led by Honble Prime Minister Shri Narendra
Modi ji was elected on the back of an unprecedented surge of
aspirations, especially among women and youth, and their dream of
24x7 power in their homes, leading to significantly improved standard
of living. Shri Narendra Modi ji entrusted me with the responsibility
of realizing this dream and fixing a dismal power scenario. I am
truly humbled by the trust reposed in my ability to combat these
challenges, and assure you that I will leave no stone unturned in
fulfilling our commitments.
I inherited a crisis-ridden power sector, where outages are more
of a norm than an exception; arbitrary coal block allocation and
suboptimal renewable energy generation. Not only did Indias 62
crore people in 22 states face complete darkness for two days in July
2012, which the Wall Street Journal termed Largest known blackout
in world history, but also nearly 30 crore people continue to languish
without power, even today after 67 years of independence.
Cash strapped power utility companies with cumulative debt of over
Rs. 304,000 crores continue to struggle with loss of 25 units out of
every 100 units generated. Coal production was practically stagnant
in the last four years, while power generation capacity expanded,

thereby widening the already skewed demand-supply gap. A country

with huge solar, wind and biomass energy potential was handicapped
with ill-conceived policies that constrained their development.
We hit the ground running early. Realization of the dream of Honble
Prime Minister Shri Narendra Modi ji to ensure 24x7 power for all
homes began with drawing of detailed roadmaps. The past 100
days have been a relentless effort to streamline coal linkages,
draw action plans in the power sector, restructure renewable
energy policies to encourage Make in India and promote energy
conservation & efficiency.
During the first three months of this government from June to August
2014, coal based power generation increased by 21.4% over the
corresponding period in 2013. Resolution of issues related to antidumping duty on import of solar energy components and reinstating
the accelerated depreciation benefit to wind power plants has
reaffirmed our commitment to zero effect on the environment.
By fast tracking the segregation of distribution of feeders in rural
areas, and by augmenting sub-transmission and distribution,
including 100% metering in urban areas, we have demonstrated our
commitment towards ending darkness in India, at the earliest.
This booklet is a brief synopsis of the first 100 days and our roadmap
for the way forward. I hope that all of you would join me in this
auspicious journey relks ek T;ksfrxZe;A

Piyush Goyal

Achievements of Ministries of Power,

Coal and New & Renewable Energy in
the First 100 Days
LEGACY
The new Government inherited a host of legacy problems
in the power sector.
Energy-starved population:
Indias average per capita energy consumption is 914
units / year versus Gujarats 1,800, Chinas ~4,000 and
USAs 14,000. There is an enormous latent demand and
nearly 30 crore people in India presently live without
electricity, even after 67 years of independence. This is an
abomination. The debilitating impact this has on families,
especially on productivity, healthcare and education,
particularly for women and children, is profound. Lack of
electricity access limits income-enhancing opportunities,
leading to a near-permanent improbability of beating the
poverty trap.
The RGGVY (Rajiv Gandhi Grameen Vidyutikaran
Yojana) recognizes a village as electrified if merely 10%
homes and a few public buildings have wiring. Whether
they are actually energized or are consuming is often not
considered. The state of the rest of the homes in a village
officially listed as electrified is not enviable.
Stranded power generation capacity:
Genesis of the problem was a 73% increase (14.7%
CAGR) in coal-based power generation capacity in four
3

years (FY10-14) versus a measly 6.1% (1.5% CAGR)

increase in coal production, in the same period. Coal
production remained sluggish because of complexities
and arbitrariness brought in the environmental clearance
process (e.g., CEPI, Go No-Go, Inviolate areas etc.)
Similarly nearly 24,000 MW of gas-fired power plants
are stranded for want of adequate gas. Tens of billions of
dollars of investment is stressed, as a result.

10-14

Metric \ Year

2009-10 2010-11

2011-12

2012-13

2013-14

CAGR

Growth

Coal
production
(MT)

532

533

540

558

565

1.5%

6.1%

Coal-based
generation
capacity
(MW)

84,198

93,918

1,12,022

1,30,221

1,45,673

1,45,673

73.0%

Suboptimal utilization of our vast hydro potential:

State-level law & order issues often triggered by
professional agitators, and long-standing inter-state
disputes have constrained growth of hydro sector in India.
Tedious and almost indefinite delays for environmental
clearances has added to the woes of the hydro power
generators, and as a result, some critical projects are not
being commissioned or are stranded. People, the ultimate
beneficiaries of such power produced, continue their wait
for reliable electricity.
Lack of focus on renewable energy sector
Committed yet undisbursed subsidies worth Rs. 3,210
crores have severely dented the credibility of the renewable
energy programme. Many approved projects are stranded
4

and not being implemented, for non-availability of assured

funding. This has forced the Ministry of New & Renewable
Energy to put all new sanctions on hold and potentially
stop subsidies to two hitherto flagship schemes. Older
subsidies were being disbursed piecemeal.
The National Clean Energy Fund was initiated to finance
the renewable energy sector. However, the money accrued
was used for meeting the fiscal deficit, and a paltry sum
allocated to the original purpose. Of the Rs. 10,254 crore
worth projects approved, an abysmal Rs. 484 crores were
released to MNRE. This led to severe disenchantment
and disillusionment of many energy entrepreneurs in the
country. On the one hand, Indias energy security is at risk,
and on the other, several adverse steps were taken which
directly hindered the progress of the renewable energy
sector in India.
Similarly, the solar industry was on the verge of collapse
due to an ill-conceived anti-dumping duty decision taken
on 22nd May, 2014 i.e. 4 days before the new government
was sworn in. The ramifications of such a decision would
have been disastrous and would have made the solar
programme in India financially unviable. The rationale
behind such a decision is hard to explain.
Inter-regional transmission constraints:
Investments required in transmission simply did not keep
pace with soaring demand and generation capacity. This
led to transmission constraints restricting flow of power from
surplus (e.g., those near pitheads such as Chhattisgarh
and Jharkhand) to deficit states (e.g. Tamil Nadu)
5

Dismal distribution infrastructure:

Several hours of daily load-sheddings and planned &
unplanned outages have become the norm in large parts
of the country. Annual operating losses of DisComs at
~Rs. 70,000 crore every year, with accumulated losses
of Rs. 2,52,000 crores and total debt of Rs. 3,04,000
crores.
This situation persists largely due to rampant and unbridled
power theft. National average for AT&C (annual technical &
commercial) losses is ~25%, with some states particularly
worrisome statistics:
Greater than 60% losses: Jammu & Kashmir, Manipur,
Nagaland and Arunachal Pradesh
Losses between 50% and 60%: Bihar and Sikkim
Losses between 40% and 50%: Uttar Pradesh,
Jharkhand and Odisha
Inter-ministerial turf-wars
One Ministry would propose, and another would
dispose. Ministers and Ministries would be consistently
at loggerheads with each other, and stories on interministerial turf-wars were a matter of bureaucratic legend.
Ministers would talk to each other on paper, and not in
person, and queries would be raised sequentially and not
all at once, thereby elongating the time taken to decide,
often fairly routine matters even. Applications would be
pending for years at end, because of trivial queries being
6

raised by one department or other, thereby vitiating the

investment climate.
An era of policy paralysis prevailed. Indecision was
the default position of the then government, and the few
decisions that were taken, were often arbitrary and the
process was non-transparent.

STRATEGY FOR FUTURE

The BJP-led NDA government is committed to provide
affordable, 24x7 power to all homes, industrial & commercial
establishments, and adequate power to farms. Towards
this end, a paradigm shift in work culture and mindset has
been instituted.
Seamless integration
The Government decided that the first step towards
solving the power crisis in India was an administrative one
ending-turf wars between Ministries which are wholly
dependent on each other. Therefore, three Ministries
Power, Coal and New & Renewable Energy were brought
under one Minister. Ever since, these three Ministries are
working seamlessly. Silos have been broken and issues
are looked at holistically, as opposed to a Ministry A
versus Ministry B issue, as was the case earlier.
Inter-ministerial coordination and bonhomie
Not just within these three Ministries, all major decisions in
this government are taken in a consultative and coordinated
manner, where all stakeholders come together, and decide
the outcome. For instance, the success of Ministries of
Power, Coal and New & Renewable Energy is contingent
on many other Ministries such as Ministry of Environment
& Forests, Ministry of Railways, Ministry of Finance,
Ministry of Commerce, Ministry of External Affairs, Ministry
of Steel, Ministry of Mines, Ministry of Petroleum & Natural
Gas, Ministry of Law, Ministry of Science and Technology,
Ministry of Development of North Eastern Region etc.
Therefore, whenever an inter-ministerial issue crops up,
8

the concerned Ministers along with delegations of officials

immediately meets and resolves it. Paperwork follows,
acknowledging the decision taken.
A culture of bonhomie between Ministers has been brought
about, and this move is being welcomed enormously by
the bureaucracy and the people at large. A vibrancy in the
establishment has been brought about which is evident, if
one goes by the investor sentiment and the renewed faith
in government, that common people have developed.
Partnership with States
The Minister of Power, Coal and New & Renewable Energy
has met 18 states, along with full delegations, about half
of them in state-capitals. Long-standing issues were
deliberated about at length, and a large number of them
were resolved across the table. A time-bound roadmap
was developed for those issues that could not be solved
immediately.
A Power & Mines Ministers conference is being held on 9th
September, 2014 to take the dialogue forward with those
with whom it has already been initiated, and to begin new
ones with the few states/UTs that remain uncovered.
Meetings with stakeholders
Several rounds of discussions were held with all major
stakeholders within the power sector public and private
power producers, transmission companies, Forum of
Regulators, CERC, all major bankers / financial institutions,
senior management of PSUs under 3 Ministries, several
hydro, solar, wind energy associations etc.
An Advisory Body has been set up under the chairmanship
of Shri Suresh Prabhu, Former Union Power Minister, to
9

identify new technologies, innovative ideas and robust

actionable structural solutions to long-standing power
sector related problems.
Guiding principles behind decision making:
1) Long-term solutions
In an endeavor to identify long term solutions to problems
in the power sector, the government is conducting a root
cause analysis for every major area. This will ensure that
adhocism does not prevail and truly structural & sustainable
solutions are formulated.
2) Outcomes, not outlays
Milton Friedman once said Judge a policy by its results,
not by its intent. The government is laser-focused on
outcomes, and believes in closely monitoring progress
to enable time-bound delivery. Innovative financing
mechanisms are considered to take projects off the ground,
given resources are often constrained. Prioritization of
issues while solving complex problems, alongwith fixed
accountability for each area, are practices that have been
enforced.
3) Minimum government, maximum governance
Dealing with government ought to be a pleasure,
rather than a pain. This government is cognizant of the
bureaucratic hassles, red-tapism and related problems
that significantly delay execution. Hence, removal of
redundancies, and simplifying processes is at the very
core of this governments work ethic. There is enormous
room for improvement in Ease of doing business, and
the positive results it can generate are immense.
10

INITIATIVES / DECISIONS TAKEN BY THE NEW

GOVERNMENT:
Record growth in coal-based electricity generation:
Coal-based electricity generation grew at a record 21.4%
in June to August -2014 vs June to August -2013, posting
three consecutive months of 20%+ growth. Imports have
stayed flat, implying this growth is on the back of domestic
coal. This is in stark contrast to mid-single digit annual
growths that one saw last year. Moreover, coal production
grew by 9.0% in August-2014 vs August-2013. The false
alarm created due to reported lower coal stocks in some
plants, is a result of significantly enhanced production.
If coal-based electricity was at routine levels, especially
given under-performance of hydro due to deficient
monsoons this season, the entire nation would have been
reeling under a power crisis. Such a situation would have
been disastrous and this government successfully averted
a potential catastrophe.
1 billion ton coal production target by 2019
For the longer term, in an effort to ensure adequate
supply of coal, Coal India Limited (CIL) has committed to
an ambitious target of 1 billion tons of coal production by
2019, from current levels of 500 million tons (18% CAGR
in 4 years).
Government is ready with a plan to expeditiously and
transparently auction blocks, subject to the outcome of
the Honble SCs judgement. As for enhancing production
from existing mines (which arent under litigation), a whole
host of efficiency & productivity improvement initiatives,
technological upgradation and better evacuation are being
11

executed on mission mode. CIL has recently opened a

new mine Amarpalli Open Cast with 12 million ton per
annum capacity.
Evacuation of coal
Close inspection of progress is underway, in an effort
to expedite build-out of three critical railway lines (at
Jharkhand, Odisha and Chhattisgarh) which could help
increase output by 60 million tons per annum by 201718, ramping up to 200 million tons by 2021-22. Ministers
have met, and Chairman Railway Board & Coal Secretary
have personally visited Chhattisgarh to resolve issues,
follow-up on pending items and are monitoring the project
frequently.
Coal India Limited has taken an in-principle decision to
purchase 250 additional rakes (worth Rs. 5,000 crore)
to evacuate greater quantities of coal, primarily to
power plants, expeditiously. Discussions with Railways
are ongoing.
Ensuring zero effect on environment
Cluster approach for environmental clearances is being
undertaken in a manner such that it brings in finality
to business decisions, helps increase domestic coal
production to supply power to the teeming millions and
power-starved industries, while preserving / restoring our
pristine ecological heritage.
Coal linkage rationalization saving hundreds of
crores
Coal linkage rationalization will save on hundreds of crores
of transportation costs. One swapping between Gujarat
and Chhattisgarh has already been done. The aim here is
12

to bring in efficiencies and link power plants to nearest coal

mines. In the current system, this optimization exercise
hasnt been carried out, and often plants located next to
mines either import or fetch coal from far-flung mines, and
not the nearest ones, contrary to what conventional logic
would presume. This exercise is to correct this wasteful
arrangement, and ensure, to the extent possible, how
these linkages are rationalized for efficient and costeffective use of resources.
Increasing coal allocation to power sector
CIL has agreed to significantly reduce e-auction quantity
from 58 million tons in an effort to increase allocation
to power sector. This will lessen impending power
shortages enormously.
Using coal more effectively
In many cases, certain old and inefficient plants consume
significantly more coal than what some of the newer plants
would, to produce the same amount of electricity. This is
an unacceptable waste of a precious resource i.e. coal.
A policy is therefore being announced to allow automatic
transfer of linkages of old & inefficient plants (more than 25
years old: 32,548 MW) to new super critical plants with a
view to maximize power generation from minimum usage
of coal.
Guaranteed enhancement of coal quality
A long-standing demand of power plants has been to
permit 3rd party sampling of coal provided by government
run companies, particularly in view of quality disputes that
have arisen in the past. CIL has now agreed to provide
an option to test at third party laboratories, with test data
13

being collected at unloading points in case of government

companies for analysis. This way disputes between
procurers and suppliers will be significantly reduced.
With a view to minimize environmental damage as well,
washeries and crushers are being installed to clean and
grind coal (to <100 MM size) and to minimize ash. Mobile
crushers are being deployed as well through outsourcing
in proximity to rail sidings.
Greater coal exploration
Exploration of new coal is being increased from 7 lakh
meters to 12 lakh meters by March 2015, and further to 25
lakh meters the next year. In this process, private entities
will also be encouraged to participate. An action plan for
technology deployment and modernization of mines on
PPP basis is being worked out. The output could potentially
increase by 100 million tons.
Clamping down on coal pilferage RFID tagged coal
movement
The government has proposed to establish a National
Coal Dispatch Monitoring Centre and RFID tag all coal
movement. Moreover, real time surveillance at all major
sensitive zones is being planned and reject-based power
plants will be set up next to mines. A proposal for a multidisciplinary security force is also under consideration.
Resolving stranded gas capacity:
Pipeline connected stranded gas capacity is ~24,148 MW.
The plan involves use of gas primarily to meet peak load
demand or to meet exigencies, since gas-based generation
14

can be ramped up at short notice. Some waivers of duties/

levies by central and state governments, along with some
financial restructuring are being evaluated.
Harnessing full potential of hydro:
Aim to maximize electricity production from hydroelectric
power (potential is 1,48,000 MW), particularly in the North
Eastern states so that not only the country benefits from
the increased power capacity but also the power-starved
North Eastern states themselves get more power and also
significantly enhance their incomes by trading surplus
power generated.
Time-bound action plan developed to expedite
environmental clearances such as 520MW Teesta IV
and 3000MW, 800MW Tawang II projects of NHPC, etc.
Expediting construction of roads and bridges in the North
East, Himachal Pradesh and Jammu & Kashmir in close
partnership with MoRTH and BRO by monthly monitoring
and review meetings.
Government is extending support to new projects e.g.,
support for Pakal Dul project (4x250 MW) The funding
will be by debt equity 70:30 by the JV of NHPC and
JKPDC. Public Investment Board (PIB) had agreed to
extend subordinate debt loan facility from Government of
India of Rs 2500 cr @ 1% interest. This project will help
in reducing power shortage not just in Jammu & Kashmir,
but also in Northern Region.
Giving an unprecedented thrust to renewable energy
Centre doubled National Clean Energy Fund (from Rs. 50 /
ton of coal to Rs. 100 / ton) to garner greater resources for
financing renewable energy. Budget outlay for renewables
15

in this budget has been increased by 65.8% (including

direct hike in solar financing by Rs. 1,000 crores).
One lakh Solar power driven agriculture and water
pumps sets
One MW solar power parks on the banks of irrigation
canals: generates electricity and reduces evaporation
of water
Setting up of ultramodern Solar Power Projects in
Rajasthan, Tamil Nadu and Ladakh in J&K.
Enabling regulations such as net metering (issued in 8
states, others in process) and a mandate of certain portion
of renewable energy generation by conventional power
producers could give the much needed boost.
Make in India solar programme
This government amicably resolved the anti-dumping duty
dispute. A whole host of measures are underway to make
India the preeminent hub for solar manufacturing, with
a priority for domestic players. Domestic manufacturers
will have greater visibility on order books, have an
opportunity to upgrade technologically and be able to
reduce costs. Several projects are on the verge of being
auctioned at an unprecedented scale with bundling and
competitive bidding.
Restarting growth in the wind sector
This government restored Accelerated Depreciation
(AD) benefit to give much-needed relief to wind-power
developers and to ensure ramp-up of production. After
AD was suddenly revoked in 2012, capacity addition saw
16

a nearly 50% fall in the subsequent year (FY13). To put

matters in perspective, growth in the two previous years
with AD benefit for wind, was 50% (FY11) and 36% (FY12)
respectively. It is believed that wind capacity addition will
again be kick-started, and will ramp up expeditiously.
Improved cook-stoves
Unnat Chulha Abhiyan (UCA) Programme with the
objectives to develop and deploy improved cook-stoves for
providing cleaner cooking energy solutions in rural, semiurban and urban areas using biomass as fuel for cooking
launched. This will save rural women from the carcinogenic
fumes emitted when traditional fuels are burned.
Ensuring transmission keeps pace with the times
A 20 year Perspective Plan for integrated inter-regional,
inter-state and intra-state transmission network for the
country as a whole (including requirements for renewable
energy) has been formulated. This will be a crucial
backbone for the vision of 24x7 power for all homes in
India, and will entail an investment of Rs. 260,000 crores.
Deen Dayal Upadhyaya Gram Jyoti Yojana
This scheme was announced in the budget and focuses
on feeder separation (domestic and agricultural)
and strengthening of sub-transmission & distribution
infrastructure in rural areas. Gujarat has demonstrated
admirable success by pioneering this scheme, and the
same is being launched pan India. The full scheme entails
an investment of ~Rs. 43,000 crores. This will augment
power supply to homes, eventually delivering 24x7 power,
and provide adequate power to farms.
17

Accelerated resolution of the Delhi power crisis

Within the first week of assuming office in late May
2014, Delhi was struck by a storm which wrecked havoc
on the transmission system. 68 lines tripped/failed, and
three critical 220 kV lines were damaged. Subsequently,
temperatures soared to an unprecedented 48 degrees,
leaving the citizens of Delhi exasperated. The Government
entrusted PowerGrid Corp with restoration of lines.
Powergrid worked 24x7 to restore supply within 2 weeks,
a feat which would otherwise take upto 6 months to
achieve.
Subsequently a 9 month plan and a 3 year plan has been
developed to avert a similar crisis in future, with Rs. 7,700
crore plan in pipeline. Work will include underground
cabling, procurement of Emergency Restoration Systems,
and smart metering.
Expediting transmission network build-out
Successfully convinced Ministry of Environment & Forests
to modify guidelines to ensure a level-playing field between
public and private transmission companies. Green Energy
Corridors are being fast-tracked to evacuate renewable
energy to grid.
Nine transmission projects, worth Rs. 12,272 crores were
approved under tariff-based competitive bidding, which
were pending for several months.
Power System Development Fund for grid security
Power System Development Fund (PSDF) of around Rs.
7,500 crore for improvement in protection system of the
grid (safety & security) is being operationalized. CERC
18

regulation has been notified and finalization of guidelines

on PSDF are in advanced stages.
One Nation, One Grid, One Frequency
Commissioning of Raichur-Solapur line is a major step in
this direction
Distribution The weakest link in the electricity supply
chain in India
Accumulated losses of State Electricity Boards is ~ Rs.
2.52 lakh crores with annual losses of ~Rs. 70,000 crores
and total accumulated debt of Rs. 3.04 lakh crores. They
are at the brink of fiscal collapse, and this constrains
their ability to invest in modernization and technological
upgradation. Rampant and unbridled power theft is at the
core of this problem.
Government of India, over time, has attempted to
incentivize better performance of state electricity boards
via Financial Restructuring Plan, R-APDRP etc, but severe
flaws continue to exist.
Integrated Power Development Scheme
This scheme has been formulated to address the critical
issues of distribution sector in the rural and semi urban
areas, including underground cabling. The scheme will
entail an investment of ~Rs. 32,600 crores.
State specific 24x7 action plans
Comprehensive state-specific action plans for 24x7
power to all homes is being prepared, in partnership
with respective states, encompassing generation,
transmission and distribution. Plans for Delhi, Rajasthan
and Andhra Pradesh are already complete and are ready
19

for implementation. Others are being readied. AT&C loss

reduction strategy is being worked on, pan India, and
the aim is to bring it down from 25% currently to 15%
eventually.
National Smart Grid Mission
A National Smart Grid Mission is going to be launched to
address key issues of Smart Grid Initiatives on a large scale
in the country and to make the Indian Power infrastructure
cost effective, responsive and reliable. Best practices from
other countries will be studied to move towards better
demand management and more efficacious utilization of
resources. Smart Grid initiatives are being launched in 14
Discoms initially as pilot.
Energy efficiency
10% energy conserved translates to 100 billion units
of energy conserved, which can light up 11 crore lives
(since per capita energy consumption = 917 units). The
Government has approved the National Mission on
Enhanced Energy Efficiency (NMEEE) in August 2014
with an outlay of Rs. 775 crore, which covers Perform,
Achieve and Trade framework for energy efficiency in
industrial units. Moreover, a Venture Capital Fund and
Partial Risk Guarantee Fund are being initiated for funding
energy efficiency projects, and Super-Efficient Electrical
Appliances (SEEP) particularly air-conditioners,
refrigerators and heaters.
Guidelines for Energy Efficient Residential Apartments
issued in August 2014 and Energy Efficiency Rating
Programme for diesel generators and hospital buildings
notified in August 2014.
20

Regulatory reforms
Proposals have been finalized for next wave of reforms
in the power sector through amendments in Electricity
Act, 2003 and Tariff Policy. These amendments entail
competition in retail (i.e. choice to consumers), strict
enforcement of Renewable Purchase Obligations (RPO)
with strict enforcement, and zero tolerance on Grid Safety
and Security.

21

Annexure:
PROJECT DEDICATIONS / FOUNDATION STONES
LAID BY HONBLE PRIME MINISTER SHRI NARENDRA
MODI JI:
In J&K:
NHPCs 300 MW Uri II
45 MW Nimoo Bazgo
44MW Chutak power stations dedicated to the nation
Works started on
transmission line

Srinagar-Leh-Kargil

220kv

In Maharashtra:
NTPCs 1000MW thermal plant in Mouda, near
Nagpur commissioned.
Foundation stone laid for the 1320 MW expansion
plant.
765 kv Raichur-Solapur line thereby making India
a One Nation One Grid One Frequency country
In Jharkhand:
Laying the Foundation stone of NTPCs 1980MW
North Karanpura thermal plant
Dedication of the PGCILs 765 kv Ranchi-Sipat line
The optimism is also being built through Indianeighbourhood partnership (SAARC)
600 MW Kholonchu project JV with Bhutan.
Nepal: DPRs / Environment reports being expedited
- Rs. 5667 crores Arun III hydro project.
22

NOTES

NOTES