The Central Electricity Authority (CEA) has listed eight States which will have surplus power by 2012. Out of these, Sikkim, Himachal Pradesh and Uttarakhand are most likely to generate significant surpluses

According to Central Electricity Authority (CEA) data, around eight States are expected to generate surplus power by the end of the XI Five Year Plan (2007-2012). However, Himachal Pradesh, Sikkim and Uttarakhand are States with greater probability of benefiting from a surplus. But these states too have their own share of glitches.

A CEA report dated April 2010 ('Power Scenario at a Glance') says that Himachal Pradesh, Jammu & Kashmir, Uttarakhand, Delhi, West Bengal, Sikkim, Arunachal Pradesh and Mizoram are the eight states likely to have surplus power at the end of the XI Five Year Plan. 

At the end of 2012, Delhi (peak surplus: 2,023 megawatts (MW), energy surplus:  23,344 million units (MUs); Sikkim (peak surplus: 1,214MW, energy surplus: 3,137 MUs); Uttarakhand (peak surplus: 772MW, energy surplus: 4,344 MUs) and Himachal Pradesh (peak surplus: 1,472MW, energy surplus: 4,609 MUs) are the States which will have significant surplus power.

The gains likely for these States from the sale of this surplus power are huge. Though it depends on how they sell the power to the grid, merchant power is expected to be priced at around Rs5 per unit against the production cost of Rs3 per unit. Margins can be more than 40% for short-term sale.

Himachal Pradesh expects to add around 1,782.50MW in the XI Five Year Plan. Overall, a high surplus of 91.4% or 1,472MW is expected by 2012, against the current deficit of 2.9% or 25MW. The State's current capacity is around 2,030.16MW.

This State has a high probability of becoming a power-surplus one. "Of the total 1,782MW expected capacity for HP, 1,000MW is to come from Karcham Wangtoo.  It is expected that it will be commissioned within the XI Plan and hence the State has a high probability of being a major surplus State by the end of 2012," said Somesh Kumar, associate director, Ernst and Young.

Sikkim, surprisingly, has added no capacity during the X Five Year Plan. Its current capacity is around 195.48MW (as on March 2010). During the XI Plan, it expects to add 775MW. The State is expected to have a surplus of 1,214MW against the current deficit of 1.2% or 1MW.

"Sikkim has 600MW share from the Teesta Stage III project (1,200MW) which eventually would result in surplus power. By the progress of the project it appears that Teesta would be commissioned in time, making Sikkim a surplus state," said Mr Kumar. Teesta III is under construction and is expected to be commissioned in the year 2011-12.

While the projects are likely to be commissioned on time, they may face issues with meeting the peak-hour demand. Moneylife had earlier reported on how hydropower projects like the Teesta and Karchan Wangtoo projects are unlikely to cater to peak hour demand, according to certain energy studies. (see: http://www.moneylife.in/article/8/5089.html).

Thus, not having peak surplus capacity will cut down on the high level of profits that can be made from trading, but the energy surplus would still be able for sale at a reasonable price.

 Uttarakhand expects to add total capacity of around 821.50MW by 2012. It added around 1,680MW during the X Five Year Plan. The State is expected to have a surplus of 50.4% or 772MW against the current deficit of 20% or 250MW. Uttarakhand's current installed capacity is around 2,404.99MW.

  The State is likely to emerge as a surplus power one provided the major power plants planned here come on stream on the decided deadlines.
       
"Uttrakhand had a major boost to its supply scenario with the commissioning of the 304MW Maner Bhali project in 2008. Another project which will be significant for the state is the 330MW Shrinagar project, being developed by GVK Industries Limited.

The plant is scheduled to be fully commissioned in March 2012 on best effort basis, but may get delayed as certain local issues are impacting its progress. If Shrinagar project is not commissioned on time, the State may not have significant surplus power," said Mr Kumar.

Delhi, which currently is facing load-shedding issues, added around 225MW during the X Plan. It is expected to add total capacity worth 6,790.5MW at the end of 2012. A surplus of 33.2% or 2,023MW against the current deficit of 5.4% or 192MW is expected to be achieved. The State's current installed capacity is around 4,114. 67MW.

However, Damodar Valley Corporation's three contributing projects Mejia II, Durgpur and Kodarma of (total capacity of around 3,000MW) are already running behind schedule. These are expected to be commissioned in the second half of 2010 or in 2011, and they will supply this power to Delhi.