No blackout of states for grid collapse: Veerappa Moily

Karan Thapar: Hello and welcome to Devil's Advocate. Twenty days after the devastating power grid failure, do we have a clear idea of what caused them and how does the government view the wider power scenario?

These are the two key questions I shall discuss today with the new Power Minister, Dr Veerappa Moily.

Dr Moily, let's start with the two consecutive power grid failure at the end of July. Do you have a clear idea of what caused them?

Veerappa Moily: Ya, we know… On the 30th and 31st, the crisis took place… But one cannot attribute the power failure to any one factor. There are many factors at work.

Karan Thapar: Let me put it like this. Newspapers like The Hindu made it crystal clear that overdrawing of power by states was neither the only nor the partial cause of what happened. Firstly, preventive mechanisms like under frequency readers that could have prevented failure, were either not installed or had been tampered with. Can you confirm those newspaper reports?

Veerappa Moily: No, I cannot confirm because the report of the expert committee is available. And it hasn't listed any of these as reasons.

Karan Thapar: So the expert committee report does not mention that the absence of under frequency readers could have led to the collapse, at all?

Veerappa Moily: No, no because that is not the reason. There are various other reasons. It is not just the overdrawing, but it is also overloading from the Western Grid. That's how the things slipped.

Karan Thapar: So it is overdrawing from the Northern Grid and overloading in the Western Grid that led to the collapse on two consecutive days…

Veerappa Moily: Yes, very much so.

Karan Thapar: Now this leads to a second explanation which too has been in the newspapers that you have critical management failure. The newspapers have said that the NRLDC and the state load dispatch centres were well aware of rampant and persistent overdrawing by certain states but they did nothing beyond filing petitions with the Central Electricity Regulatory Commission. More effective steps were not taken to deal with overdrawing which led to the crisis.

Veerappa Moily: The difficulty is that the distribution system is with the state governments and if there is overdrawing, we cannot switch off. But the question is discipline has to be maintained and rules will have to be adhered to. You know the Central Grid, the national grid, has no control over the distribution system.

Karan Thapar: I will come to the discipline part at a later stage. But let me first quote to you what a member of the Power Ministry told The Hindu on August 2. 'The control rooms of these load dispatch centres were fully aware of what was going on and which states were posing a danger to the grid. But they failed to isolate these states from the grid and therefore they failed to prevent a grid collapse.' That clearly proves management failure.

Veerappa Moily: No, no, I spent four hours in the National Dispatch Centre in Delhi. I went into every detail. The dispatches were sent to each of these states. Overdrawal and northern grid states were issued the notices.

Karan Thapar: That's all they did. They just filed petitions. No more effective steps were taken.

Veerappa Moily: There is only one alternative to that, i.e. switching off the grid. That will, however, be a bigger disaster.

Karan Thapar: But those states are defaulters. Supply to them must be stopped.

Veerappa Moily: Such decisions are difficult. There should be an independent regulatory authority to control the states.

Karan Thapar: I want to bring another point to light that again proves management failure. It is reported that 24 hours before the first grid failure, authorities had a clear warning of an impending disaster because there was a near-miss situation on July 29. But the authorities did not pay any heed to the warnings.

Veerappa Moily: I went into that. I referred it to the committee. But what happened on July 29 was an isolated incident. It had no implications on what happened on July 30 and 31.

Karan Thapar: So no indications of management failure?

Veerappa Moily: Not at all.

Karan Thapar: Let me come to the five states that have been accused of overdrawing. They are not accepting responsibility for what happened. Punjab has gone on record to say the charges of overdrawing are absurd and factually baseless.

Veerappa Moily: We did call a Chief Ministers' conference to discuss the problem. You know, overdrawing is not the only problem. Overloading too is a problem. The question is not whether the states agree to the charges or not. We are not into blame game. We took a resolution that grid discipline is maintained at any cost.

Karan Thapar: Okay let us come to that point. What measures do you propose to ensure grid discipline?

Veerappa Moily: You know in 2010, a decision was taken for auditing of the grid system but it was not implemented because the states said they did not have the money to do it. So now we have decided that the Centre will audit it. Then the National and regional load dispatch centres, in consultation with Central electricity authorities, will review the transfer capability of inter-regional links keeping in view the factors leading to grid disturbance. There should be appropriate matching with regard to the distribution system which is under the state control and the central trunk line. If the states do not do it, there will be collapse.

Karan Thapar: So, in layman's language, all the mismatches between the trunk line and the distribution system must be removed and there should be matching systems, there should be no anomalies. Right?

Veerappa Moily: Right.

Karan Thapar: Now what about giving load dispatch centres the power to cut off states that overdraw and do not pay heed to warnings.

Veerappa Moily: We need not give power to any centre. We can straightaway cut off the power. But that is not the solution. Will cutting off the power supply to a state help matters?

Karan Thapar: Minister, if the choice is between blacking out one state and blacking out the whole of Northern India, you don't have much choice.

Veerappa Moily: No no this is a matter that the states should understand. Also this is not something that will be repeated.

Karan Thapar: But if you do not take action against erring states, this will continue. Will you take action the next time it happens?

Veerappa Moily: Ultimately, the kind of short term and long term measures that we are going to put in place now…

Karan Thapar: You are not answering my question… Will you take action against erring states?

Veerappa Moily: I am answering your question. I am telling you that that occasion will not come. I will put in systems that will ensure that the mismatches do not take place.

Karan Thapar: I am afraid if you do not give the load dispatch centres the power to cut out erring states, no one would believe that this won't happen again.

Veerappa Moily: No, no, I am repeating my statement. Overdrawing or overloading alone is not the problem. That is why let us not blame the states.

Karan Thapar: So if not blacking out states, would you be willing to take other easier, not-so-radical measures like heavy fines?

Veerappa Moily: Yes, yes, that is what I am contemplating now. Heavy fines and also imprisonment for disobeying orders. Perhaps we need to enforce that.

Karan Thapar: So you are prepared to exercise the whip if need be…

Veerappa Moily: Yes, why punish the people. Let us punish the guilty officers.

Karan Thapar: Another question. Have you considered islanding critical cities like the capital or facilities like the airports, the metro, hospitals and the Railways?

Veerappa Moily: Yes, we are also considering that. Islanding the capital may not be possible. But essential services will be. It will be taken up as a mission.

Karan Thapar: Let us come to the wider power scenario in India. You are said to have a peak time shortfall between 10 and 12 per cent. Secondly, the target to build additional capacity were not met in the ninth, the tenth or the eleventh plan. How do you explain this poor planning performance?

Veerappa Moily: I must tell you the target that has been achieved despite shortfall in the eleventh plan.

Karan Thapar: Forgive me, can I quote to you Bloomberg which has said that India has missed every capacity addition target since 1951. Answer me. Why is it that we cannot meet targets?

Veerappa Moily: I can only talk about the eleventh plan when we achieved 2.5 times of the achievement than any other five year plan.

Karan Thapar: The Hindu says that just about a half of planned capacity additions were achieved in the 8th, 9th and 10th plans. The story of underperformance continued in the eleventh plan. So you failed…

Veerappa Moily: No, no, this is only an exaggeration. When I can speak about the eleventh plan, it is 2.5 times the achievement of all the five year plans put together…

Karan Thapar: But you still haven't achieved the target of the eleventh plan. Let me put up a second problem. Twenty seven per cent of the power you generate is lost either because of theft or due to dissipation through the wires. It is five times the Chinese figure. As a result, the losses are Rs 1.8 lakh crore which is almost three per cent of the GDP. That is appalling management.

Veerappa Moily: All these losses… the national average is 27 per cent. The point is the state distribution systems are in a bad state. The Centre is working on it to ensure that all the distributions systems are revamped. The states too will have to do their bit. They will have to decide their tariffs.

Karan Thapar: Can I put a simple question? There are less than two years for this government and the task you face is Herculean. How much of it can be achieved between now and May 2014. Give me an answer.

Veerappa Moily: The progress is very good. I am telling you all this on the basis of evidence we have. From 27 per cent losses, we will bring it down to less than 15 per cent.

Karan Thapar: What about Rs 1.8 lakh crore losses?

Veerappa Moily: More than 75 per cent of these losses would be covered.

Karan Thapar: Alright. The country will be holding you responsible to your two promises.

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