Plan panel’s approach created excess power capacity: Goyal

Power Minister Piyush Goyal today blamed the erstwhile Planning Commission, which has been succeeded by Niti Aayog, for its approach of setting targets that led to a situation where companies “invested irrationally” to add capacities in the sector.

The Ministry of Power is an Indian government ministry. The current Union Minister of State (Independent charge) is Piyush Goyal. The ministry is charged with overseeing electricity production and infrastructure development, including generation, transmission, and delivery, as well as maintenance projects. India faces challenges in electrical supply and delivery, and is often unable to meet demand, even in very large cities.

The Planning Commission (Hindi: Yojana Ayog) was an institution in the Government of India, which formulated India’s Five-Year Plans, among other functions.

In his first Independence Day speech in 2014, Prime Minister Narendra Modi announced his intention to dissolve the Planning Commission. It has since been replaced by a new institution named NITI Aayog. The ministry acts as a liaison between the central government and state electricity operations, as well as with the private sector. 

The ministry also oversees rural electrification projects. “The Planning Commission had inaccurately set targets of power generation which had led to the public and the private sector to invest in adding capacity,” Goyal told reporters on the sidelines of the annual session of MCCI here.

The composition of the Commission underwent considerable changes since its initiation. With the Prime Minister as the ex officio Chairman, the committee had a nominated Deputy Chairman, with the rank of a full Cabinet Minister. Cabinet Ministers with certain important portfolios acted as ex officio members of the Commission, while the full-time members were experts in various fields like economics, industry, science and general administration.

 “The Planning Commission had never got its job rightly done. This is why companies in both public and private sector invested irrationally for adding generating capacity,” Goyal said.

With the tenure of the 12th Five Year Plan ending in 2017 and being replaced by Niti Aayog, Goyal said under the new dispensation, the states would be empowered to set their own targets instead of the Centre.

He also criticised the Planning Commission for laying emphasis on imports of coal, citing shortfall in domestic production.

“For this, power plants had been set up which could run specifically on imported coal. But, now we are shifting the focus from coal imports to increased domestic production,” he said.

Goyal’s criticism of the Plan panel assumed significance in the wake of the utilities engaged thermal generation slowing down their coal offtake due to excess supply.Laying stress on renewable energy, Goyal, who also looks after coal, mines and new renewable energy portfolios, said: “It is the future. Renewable energy will always come at an affordable price as against thermal power and also add to India’s energy security.

“By 2030, 40 per cent of India’s installed capacity will come from renewable sources, wind, solar and hydel. It will also help the country in reducing carbon dioxide emissions for which India is committed to.” 

He also urged the West Bengal government to join the Ujala efficient lighting scheme by which normal bulbs would be replaced by LEDs leading to cost savings.