Saturday, June 16, 2007

...where ambitions exceed power supply

Umred, a small colliery town near Nagpur in central India was in news a few months back.... and perhaps provides an insight into the dynamics of mass-scale social exclusion - and its implications - mentioned in the previous post. here are Notes from Umred:

    "India does not have enough electricity for all of its 1.1 billion people, and so daily outages as long as 18 hours are imposed on smaller settlements so that megacities like Mumbai can enjoy a 24-hour supply.... The burden is carried by villages and small towns.

    ...last February, in this small, dusty town of 50,000 in central India, where goats and children scamper through the byways, the blackouts triggered a violent revolt. Thousands marched on the local government offices, some pelting stones, others setting police jeeps ablaze. When the police fired their guns to scatter the mob, at least two people were struck and killed.... a recent visit to Umred suggested that the uprising might also reflect new anxieties stewing in a nation where ambitions are trickling down much faster than the means to achieve them.

    ...Satellite television is beaming urban India's new cravings and anxieties into Umred's living rooms. Relatives who migrated to cities are returning home with tales of lucrative jobs and trendy nightclubs. The Internet has emboldened the young to hunt beyond the town for jobs, life partners and ideas....

    "Electricity is essential to ambition," said Ravindra Misal, the 26-year-old owner of an English-language academy here, "because I need it to do my homework, I need it to listen to music if I am a dancer, I need it to listen to tapes of great speakers, I need it to surf the Internet... But I cannot, so people get angry. They have bigger expectations, but electricity is becoming a hurdle on their path."

    ....(the) heightened expectations are distilled in a new craving for schooling. Across India, there is a new insistence among the uneducated that their children receive educations and break poverty's hereditary chain.

    But the blackouts were distracting their children from their evening studying. When the parents marched in February, a principal demand was that blackouts be suspended during the annual examinations that can make or break a child's career in India.

    Sushrut Lanjewar, an 8-year-old with a Spider-Man T-shirt, is still learning his letters, but he has already reached a grown-up conclusion. He knows he must study his way out of Umred, and he intends to do so. He wants to be a botanist and discover a plant to thwart global warming.

    But a mysterious force is obstructing him, he said.

    Several nights a week, he said, electricity vanishes from Umred. The houses darken. The televisions sputter off. Lanjewar, a nephew of the sporting-goods seller, lights a candle to finish his homework.

    But he loses his focus, he said, because of the flickering light and the motionless ceiling fan that fails to blow mosquitoes away.

    "Are these people crazy who keep turning off the light?" he asked, not just angry but inquisitive. Why do grown-ups keep telling him to do his homework and then shut off the light?

    He was told that 8-year-olds in Mumbai have 24-hour electricity.

    His eyes bulged. He looked like a child stripped of Santa Claus fantasies. "If they can get the light," he asked, "how come we can't get it?"

    Entering the hottest season, however, the crisis is so acute in Maharashtra that even Mumbai may face blackouts. They would be the first in decades, and Mumbai's Scotch-sipping elite is furious at the prospect of no air conditioning for 90 minutes a day.

    In Umred, a 90-minute disruption would be a luxury. Its blackouts are typically eight to 12 hours a day.

    "Why?" barked Abhay Lanjewar, the proprietor of a sporting-goods store in Umred. "They're humans in Bombay, but we're only animals here?"

Deeper down, his is not a rhetoric question...

Cross posted at: How the Other Half Lives


Anand Surana said...

Someone please send this to YSR Reddy, the CM of Andhra Pradesh who is giving free power to farmers. According to some recent news items as much as 30 % of the total power in the state is being consumed by the farmers; not only for themselves but aome of them sell it to non-farmers too.

Madhukar said...

Hi Anand,

have not read the news-items, but do recall reading a, I think, a World Bank report on power supply/subsidy to farmers (It must have been some 5-6 years back, when the issue of farmer subsidy was much in light). It covered AP as well as some ohter states.

Two points I remember are:

one, the methodology adapted by the SEBs to calculate the power supply to farmers was full of loopholes - not calculated on the basis of meter reading (since there are no meters installed in the first place) - but on the basis of a flat rate calculated on the horsepower of the total irrigation pump-sets installed in the state, and linked it the kilo-watt power that the pump would consume.
(when the WB actually tested these esitmates on a sample of 500+ pumps, it found that the electricity consumed was about 1/3 of the official estimates)

two, the report also mentioned the poor quality of power that was supplied, which would often lead to burnout of the motor of the pumpsets, erratic backouts, etc.

The issue, to me, is not whether the power goes to small towns, metros or to farmers, but whether it is used for productive purposes..

Supratim said...

Don't you think that the bigger issue is the inadequacy of our power supply? That, even today, the govt dithers on new power plants, instead of tackling this issue on a war footing.

That, SEBs suffer from 30-60% "T&D" losses? Maharashtra's power issues would be mitigated to a large extent if the theft of power could be stopped, or at least, reduced.

What is it that the "intellegentsia" never focusses on these types of issues (possible solutions) instead of crying itself hoarse over the 24 hr supply to Mumbai?

Actually, cutting power to Mumbai might be a good idea. Then the transformation to Slumbai will be complete, and all the "productive" people would move out of the city. Then, the govt does not have "waste" all that money on the regeneration of the city. Good idea!!!

Madhukar said...

Thanks, Supratim!... long time you visited this blog:)

as usual, your grasp of the issues is remarkable... never even occured to me that "T&D losses" are the crux of the issue - and the solution. I guess, no one else has either hit on this insight so far!!

as you can see that I am slightly clueless - and you KNOW it all -, you may also comment on what is "T&D" - maybe the also the investments needed to measure and plug the leak, where the money is going to come from (since it will have long gestation period to recover), about DEA and PRAYAS studies about which section of society (slums, posh localities and large industries) account for the larger proportion of these thefts, etc...


Supratim said...

I am unable to judge how much sarcasm was mixed in your post, Prof! But, all to the good, if I got you to respond!!! :)

T&D losses = transmission and distribution losses (I am sure, you were being sarcy about this, but I will humour you anway). In a well run power distribution company, this should be c. 6-10%. MSEB (or whatever the new distn co is called) has losses of upto 60% in some areas. Essentially, all unbilled power is classified as T&D, including theft.

The investment required to bring this down to, say 20%, is very little and there is no gestation period involved. All it requires is the ability and will to detect illegal connections, remove them and penalise the offendors.

Unfortunately, this requires large degree of political will, since, as you rightly hinted, that the rich and the powerful are the biggest culprits. I remember reading recently that our esteemed CM's district, Latur, had the highest T&D losses.

So, no, I do not underestimate the problem but I am surprised that the "well meaning and informed" commentators/idealogues do not focus on this aspect of the power problem more, instead of berating Mumbai. But, why do you think that reducing theft WILL NOT help the power supply situation in Maharashtra?

And, in this situation can you blame MSEB, if they choose to supply Mumbai, which pays for all (mostly) its power? BEST and Reliance (erstwhile, BSES) have T&D losses of less than 12%.

Also, BTW, I started the post by saying we need to increase the supply of power, which is certainly the "crux" of the matter (and, which you ignored completely). T&D mitigation can only provide an immediate, short term, helping hand.


Madhukar said...

Hi Supratim!

well, I do respond to your comments... even if not very promptly (and that is not because they are your comments... I am, as I often say, "an occasional blogger":)

the reason for being "sarcy" was that somehow you make complex issues into simple fairy tale solutions that are churned out in boardrooms.

yes, no denying that in India we have the highest T&D losses - around 40% aggregate - and tackling that can solve much of the shortage.

But to my understanding "T&D mitigation can only provide an immediate, short term, helping hand" is not as easy as it is keyed-in... for a numbe of reasons:

1. the lareger proportion of T&D losses do not happen due to illegal connections in the lower strata localities - but as the studies by Prayas, bses, etc. found - they happen from the homes and establishements of the upper strata who are well-connected. In Delhi, it was the up-market residential localities like Friends' Colony, and large industrial complexes, which were the major defaulters/culprits.

2. The issue is not of installing meters and charging the culprits, but also of "law and order" - BSES was attacked in posh localities when they tried to install meters in Delhi; MSEB has asked for private security force to help it do what it is supposed to do..... etc.

3. I do hope, that one day all this will happen... but given the ignorance and apathy of urban educated, this will not happen in "immediately"

I have no disagreements with you about the need to mitigate T&D losses, but dont see that given the complexity of the issue it can happen overnight.

In the meanwhile, we still have an artificial scarcity due to these losses... and there is a huge social cost to that - which this post focuses on.

Rightly or wrongly, my take is that if/till the resources are scarce, there is a need to regulate their squandering in non-productive channels... I mean, why is it that places like Umred have to pay the price (only asking that power be given to them for their kids to study - and they were not asking it for free) and not the other more favoured cities.

As for you earlier comment here, that precisely is my point. Besides the fact that investments in power generation require huge outlay and long gestation (that is why the private sector investments are low - not because of govt controls), even if private sector invests in this sector, it will not have much impact on pattern of distribution of power. Orissa is a case in point, which is a power-suplus state, supplies power ot Maharashtra, but has 90% villages without electricity....

The "market dynamics" dictates that it is profitable to sell electricity to "multiplexes and hypermarkets, etc (who) are charged at a rate that is much higher than even industrial power" than to small towns and villages where the need for electricity is for kids to study, for industries to flourish, for people to become more productive in whatever they are doing.

rest my case;)

Supratim said...

Dear Prof,

I agree I try to reduce complex problems to "first principles" as a starting point. You can then add complexity, as required. My limited experience is that doing so helps in finding a solution quicker and easier.

And, nothing that you have written above changes my view that the core of the T&D problem is essentially simple. It may require political will to solve it, but the problem is not complex.

However, your post does raise two very important points.

The first is of a social nature, about why are less "priviledged" cities/towns/villages being deprived of power. I fully agree with you that this is a bane of India, along with poor healthcare, sanitation and water supply. It is the govt's "duty" to provide all of these at a reasonable cost to the "poor", out of the taxes that it collects from the "rich". The reasons behind the govt's failures can be debated endlessly, which I do not propose to do here. But, I agree completely with you on the need part.

The second important point of your post is about distributing scarcity (in this case, Power). This is where I do not agree with you.

There are many reasons for this:

1. By taking power away from Mumbai today, you may be doing more long term harm, economically. The capacity for Mumbai to pay is more, which benefits the SEB, which is in deep financial difficulties. If you switch the power to lower paying areas, you are essentially crippling the SEB for the future.

2. Mumbai became a soft target for "leftist" thinkers/commentators, etc during the power crisis. My point was how much more effective all the commentary would have been, if they had focussed on the T&D issue, instead. They could have prodded the govt to take some action? Look at the effect of one statement from President Kalam in Maharashtra? (Don't know how long it will last, though)

3. There is also a productivity issue involved. I do not have numbers to back this, but I reckon that the per unit productivity of per MW of power supplied to Mumbai is much greater than that supplied to a rural area. This is an economic argument, which I agree does not consider the "human" angle. But, again over the longer term, the net benefit to India is much greater.

4. The focus should be on increasing supply. I don't agree with you that the long gestation period is the reason for private capital not coming into power generation. Various govts, at various points in time, have stymied numerous private projects. Sasan is a prime example today - if the govt thinks that the change of ownership invalidates the lowest bid, award the contract to the next party (the difference is only 7 paise, anyway). Why are they sitting on the project?

The case of power today is very much like the issue of telephones 10 years back. Wireless and private players solved that problem. No one talks of rural connectivity now, do they?

We need a similar, lateral solution for power. Too bad that we can not transmit power without wires!

Supratim said...

I accept your point about the hypermarkets, etc vs the kids in Umred. It does seem heartless for hypermarkets to be awash in light and airconditioning while Umred suffers in the darkness.

However, in addition to the above points, I am loath to have the govt dictate a certain % of loadshedding in Mumbai because that is an easy solution for untrustworthy govts and it is very easy for them to keep extending the %, like our slums cut-off date, instead of doing anything to solve the problem, which has been self-evident and growing for the last 10 years.

If they strung up a few politicians in Umred, we might start moving on the road to solutions.