6th Five Year Plan
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28 || Appendix

Chapter 15:

The vital importance of energy, the growing problem's of eneigy supply and the possibilities ot inter-fuel substitution require thai the policy and plans for individual energy producing sectors should be part of an overall energy strategy. Energy is an essential input to all productive economic activity and the process of economic development inevitably demands increasingly higher 'evels of energy consumption.


15.1 The present per capita commercial energy consumption in India is only about a tenth of the global average reflecting the country's low level of income. While India, in common with many developing countries, consumes energy in a variety of forms ranging from electricity obtained from nuclear ifuels to agricultural waste and animal dung, the pattern of commercial energy consumption is characterised by a high degree of oil dependency, the share of oil products (measured in coal replacement terms) being close to fifty per cent. Just when the Indian economy had managed to adjust itself to the oil price increases of 1973-74, there has been a three-fold increase in oil prices in the last two years. Apart from the heavy strain this will cast on the country's balance of payments, even the physical availability uf oil in the international markets will pose a problem in the years to come. This means be hampered by inadequacies of energy supply, rethat if India's plans of economic growth are not to duced dependence on imported oil has to be a key element in our development strategy. The main elements of such a strategy are as follows:

  1. accelerated exploitation of domestic conventional energy resources of, coal, hydro and nuclear power',
  2. management of oil demand;
  3. energy conservation;
  4. exploitation of renewable sources of energy like energy forestry and bio-eas. specially to meet the energy requirements ol rural communities; and
  5. intensification of research and development in emerging energy technologies.

The Energy sector of the Plan is geared to implement this basic strategy.

Pattern of Energy Consumption

15.2 The total commercial energy consumed increased five-fold during the last twenty-five years. Between 1953-54 and 1975-76, the annual growth rate in commercial energy consumption was 6.78 per cent as against the GDP growth rate of 3.68 per cent, the GDP—energy elasticity co-efficient has remained stable at around 1.8 and is high compared to developed countries. Fire wood, agricultural waste and animal dung (which are commonly referred to as non-commercial forms of energy) continue to contribute a substantial proportion of the total energy consumed in the country, though reliable data on the extent and pattern of their use are not available. Rough estimates indicate that between 40 and 45 per cent of the total energy consumed is still accounted for by non-commercial fuels.

15.3 The household sector in India is the largest consumer of energy accounting for about 50 per cent of the total energy consumption. Most of the energy used in this sector is in the form of noncommercial energy. Of the total of 5.7 lakh villages, about 2.5 lakh villages have been electrified. but the percentage of households electrified is about 14 per cent only. Only an estimated 5 million households use kerosene for cooking. Firewood, animal and vegetable waste constitute the cooking fuel in over 90 per cent of total households in the country. The share of agriculture in commercial energy consumption is still small (10 to 11 per cent), though it has increased rapidly during the iast decade. With an estimated 80 million work animals and 44 million plough shares, animal power still provides the overwhelming share of draught energy in agriculture.

15.4 The industries sector has the largest consumption of commercial energy (about 38.5 per cent). What is more, the intensity of energy use in this swtor has been rising sharply mainly on account of higher electricity consumption. The electricity consumed per rupee of value added went up sharply from 0.54 kwh in 1960-61 to 1.02 kwh in 1975-76. The relatively high proportion in the industry mix of power-intensive primary metal industries in the initial stages of industrialisation and substitution of other energy forms by electricity appear to have contributed to the high electricity intensity. Road and rail transport dominate the transport scene, accounting for as much as 95 per cent of the fuel-using transport. Of the two, the road system has expanded faster than the rail system in the last three decades. Air transport has registered an increase in the last fifteen years with an annual growth rate of about 10-11 per cent. On the other hand, there has been no strikine development in water transport, including coastal shipping. As for bullock carts, their number is estimated to have increased slightly from 12 million to 13 million during the sixties.

15.5 Viewed overall, the energy consumption pattern in India shows a high commercial energy-GDP elasticity caused partly by a steady substitution of non-commercial by commercial fuels. The bulk of commercial energy consumption is in the industry and transport sectors, while the domestic and the agriculture sectors continue to rely mostly on the so-called non-commercial fuels.

Energy Resources

15.6 The most important source of commercial energy in India is coal. The reserves of coal in seam"upto a depth of 600 metres and of thickness of 1.2 metres and above are estimated at 85,444 million tonnes, of which 24604 million tonnes are categorised as 'proved' reserves. Of the balance, 37585 million tonnes are 'indicated' reserves and the rest 'inferred' reserves. The bulk of the coal reserves are cf the non-coking variety (67,533 million tonnes). In the context of the recent developments on the world energy scene, the possibilities of mining at greater depths and from thinner seams are coming up for consideration. A quick inventory shows that there could be possible additional reserves of 26,184 million tonnes of coal in seams between 600 and 1200 metres depth and thickness of 0.5 to 1.2 metres.

15.7 As on 1st January. 1980, the balance of net recoverable reserves of oil in the 'definite' category was about 360 million tonnes and of gas about 350 billion cu-metres. Prognostic studies indicate a bright picture regarding the balance potential. But such estimates, it should be remembered, are based on a multiolicitv of variables and imponderables and are, as such, subject to wide fluctuations.

15.8 A systematic survey of India's hydro-electric potential undertaken in the fifties bv the Central Water and Power Commission assessed the totnl firm hydro-potential to bs equivalent to an annual generation of 216 Twh C41155MW at 60 per ceni'Ioad factor) A fresh survey has been inititated in 1976 by the Central Electricity Authority. The tentative results of the reassessment exercise, which is still incomplete, indicate that the total hydro-electric potential is equivalent to 75400 MW at 60 per cent load factor. The potential which has already been developed till the end of 1978 is 39.4 Twh or about 10 per cent of the total available potential. Besides, it is estimated that an annual energy gec-eration of about 25 Twh could be obtained economically through mini and micro hydels, canal drops and other possible low head development.

15.9 The reasonably assured uranium resources in India are placed at about 34000 tonnes of Ug Og of which about 15000 tonnes are considered economically exploitable at current international prices. The established uranium resources are estimated to be capable of supporting a first stage nuclear power programme consisting of natural uranium reactors of about 8000 MW of installed capacity. When thorium fuelled breeder reactors are constructed in the subsequent stages of the nuclear programme, the country could draw on an estimated 363,000 tonnes of thorium deposits (ThOs).

15.10 Large as the commercial energy resources of India appear, the reserves are small in per capita terms compared to many other countries. While India has reserves of 176 tonnes of coal per person, USA has 13488 tonnes, USSR 22066 tonnes and China 1168 tonnes. The balance of our proven reserves of oil are also very limited being only 0.55 tonnes per capita as against 34.83 tonnes in USSR, 16.32 tonnes in USA and 2.86 tonnes in China. As exploration proceeds, more reserves may no doubt be found, but the overall picture is unlikely to show any marked change.

Future Energy Demand

15.11 In spite of the uncertainties which affect the factors that determine future energy demand, there is need to make long term forecasts of such demand, as the long gestation of energy supply projects necessitates decisions to be taken far ahead of the materialisation of demand. The Working Group on Energy Policy estimated that if no deliberate measures were initiated to manage the demand, the energy requirement would register a fourfold increase within the next twenty years, it the economic growth rates were to be in the range of 5.5-6 per cent during this period. Even if measures were taken to increase the efficiency of fuel utilisation, reduce energy consumption by adopting more energy-efficient technologies and achieve desirable inter-fuel substitution, the energy demand by the turn of the century would be ncariv three times what it is at present. According to these projections, the requirements of coal, oil and electricity generation would be of the order of 426 million tonnes, 69 million tonnes and 464 Twh respectively in the year 2000.

15.12 Maintaining a reasonable balance between energy requirement and energy availability will it is apparent, pose a serious challenge in the coming decades. As stated earlier, it calls for a -oherent energy strategy which takes into account the country's own resource endowments, the degree to which tlie energy demand could itself be managed through more efficient utilisation of energy and the extent to which renewable energy technologies appropriate to Indian conditions could be inducted. Accelerated Exploitation of domestic energy resources

15.13 A faster exploitation of our domestic energy resources has clearly to be a basic element in our energy strategy. While several measures have been initiated in the last few years to accelerate exploration for oil and gas, there are still large areas, both on shore and off-shore, where the exploratory effort needs to be intensified. As oil prices rise, exploration of even relatively less promising areas becomes economic despite a higher discovery cost of oil. Equally, attention would have to be paid to a rapid development of proven hydro carbon reserves. India has had a long history of coal exploration and though a considerable amount of exploratory drilling remains to be carried out to upgrade and extend the reserves in many areas, the major thrust in the coal sector will have to be on increasing production. Coal being the only fossil fuel in which India is relatively well endowed, it is generally agreed that this would have to be the main source of commercial energy in the next few decades. There are, without doubt, formidable problems which stand in the way of large and sustained increase in coal production, but these would have to be faced.

15.14 Among the non-fossil conventional sources of energy, we have so far exploited only a small fraction of our substantial potential for hydro electric generation. As hydro power is both renewable and non-polluting, we must develop our hydel resources with a sense of urgency. The task is by no means easy: a substantial proportion of the potential yet to be exploited lies in the sub-Himalayan regions of northern and north-eastern India where the sites are not easilv accessible, the working seasons are limited and the geological conditions are difficult. Exploitation of the hydro-potential in some of the river valleys is dependent on satisfactory agreements being reached between the different riverine States Further, on account of the long gestation and higher initial capital cost, hvdro development also involves the problem of finding additional investment funds. Nevertheless, this programme has to be given a major push forward.

15.15 While the contribution of nuclear power to the total power generation has remained modest, the need to pursue further development of nuclear power with greater vigour is clearly established. There are regions of the country located far from the coalfields where establishment of coal based power stations will cast a heavy burden on the railway system for transporting' coal. Moreover, if the country is to exploit its abundant thorium reserves in future breeder reactors, we must develop a high degree ot self-reliance in nuclear power technology and constantly upgrade our scientific and manufacturing capabilities by maintaining an adequate tempo of construction of conventional nuclear reactors.

Management of Oil Demand

15.16 Though India's domestic oil production has gone up in the last twenty years, about sixty per cent of the requirements of crude oil and petroleum products are still being met through imports. As it is, over two thirds of the country's earnings of foreign exchange through merchandise exports have to be utilised for oil import. Unless we are able to strike new oilfields, there is little prospect of decreasing the country's dependence on imports. The demand management of petroleum products therefore assumes vital importance; the object would be to minimise the consumption of oil without hindering the growth of various sectors of the economy. This will require two-pronged action, namely, ensuring adequate availability of alternate sources of energy viz. coal and power, and more economic use of petroleum products in sectors where use of oil is unavoidable.

15.17 Since the transport sector is the largest consumer of petroleum products, a major issue is the steady increase in the share of road transport, which is less efficient than railways from the point of view of energy use. The long term transport policy would therefore have to provide for optimal use of scarce fuels. Within the railway system, the electrification of high density traffic trunk routes would have to be accelerated, as this would be beneficial from the point of view of both energy efficiency and conservation of oil. The consumption of oil as industrial fuel, fortunately, is not large in India. Even then, a concerted effort would have to be made to encourage substitution of oil by coal wherever technically feasible. This process could be accelerated through provision of appropriate financial and fiscal incentives and pricing policies. A rapid extension of the electricity system to the rural areas will also help in curbing growth of oil consumption; the use of diesel pumps could be minimised, while house-hold electrification could reduce the demand for kerosene to some extent.

15.18 Apart from these long-term measures, considerable savings could be achieved through improvement in the efficiency of use of oil products. For instance, it has been estimated bv experts in glass making that the average norm in India is four ton-nes of glass drawing per ton of furnace oil, as against seven to nine tons in the developed countries. Studies by the Petroleum Conservation Research Association (PCRA) indicate a savings potential of 12—13 per cent of furnace oil in the industrial sector. Similar possibilities exist in other sectors: to illustrate diagnostic studies conducted bv PCRA in twentv-four denots of various State Transport Undertakings revealed potential of at least 6 per cent saving bv better driving practices and better maintenance of vehicles. In the domestic sector kerosene stoves with a thermal efficiency of 55 to 60 per cent against the average efficiency of 35 to 40 per cent of a large variety of stoves now sold in the country have already been introduced in the market; supplies of such improved devices need lo be vastly stepped up.

Energy Conservation

15.19 It is not as if energy conservation is needed only in the use of oil. The cheapest form of alternative energy is energy saved. More attention will therefore have to be paid to the efficiency of energy generation and energy utilisation. It is well known that the proportion of energy consumed in the production and distribution of electricity is abnormally high in our power system. While the transmission and distribution losses in a country like India with a low load density are bound to be higher than in the highly industrialised countries where the loads are more concentrated, it should be possible to bring down the losses well below the current level of twenty per cent. There can also be no question that improvement in the capacity utilisation of existing generation equipment can be more cost effective than addition of new capacity. While it is true that power system load factors in India are already quite high, there is still some scope for increasing them through demand management.

15.20 The industrial sector, which consumes the largest proportion of commercial energy, must pay special attention to energy conservation. In many industries in India, the energy consumption per unit of output is distinctly higher than in other countries. It is possible that uneconomic unit size and obsolete technology contribute to higher energy consumption in some industries. Besides, low price of power and sheltered markets have fostered a climate in which the need for energy economy is not sufficiently appreciated. Measures have to be initiated for drawing up energy consumption norms for various kinds of fuel using equipment. Training programmes would have to be launched on a wide scale for the operating personnel in order to inculcate procedures and methods of achieving energy economy. For the small scale sector, assistance would have to be rendered to improve their designs and by providing test facilities. In evaluating new technologies, energy efficiency would hereafter have to be treated as one of the criteria. Simultaneously with offer of incentives for capital investment needed for achieving higher energy efficiency and the desired inter-fuel substitution, one should begin to move towards a package of regulatory measures tor energy audit with a view to penalise wasteful energy use.

15.21 Combined generation of electricity and process heat or 'co-generation' has to be encouraged in all industries where it is technically feasible, as this optimises energy utilisation. This is already being practised for instance, in the sugar industry, but there is scope in several other industries such as fertilizer, paper, etc. While in new industries facilities for co-generation should be insisted upon wherever it is appropriate, the grant of incentives for the capital investment which may be needed for installing such facilities in existing industries needs to be examined.

15.22 The scope for energy conservation is not confined only to the industrial sector. Earlier, we have seen how savings in the use of oil could be achieved in the transport and domestic sectors. Such possibilities exist even in the agricultural sector, studies of electric pump sets indicate that even though the design efficiencies of the pumps and the motor are not- unsatisfactory, mis-match between their capacity (i.e. of the pump and the motor) and wrong choice of suction and delivery pipes among others, result in low overall efficiency of the pump set installations on the ground. Here again, mechanisms would have to be developed to provide technical guidance to farmers and to ensure proper choice of equipment.

Pricing of Energy

15.23 In parallel with action on the technological front, an appropriate energy pricing policy would have to be followed in order to induce economies in the use of energy in all sectors and encourage the desired forms of inter-fuel substitution. In the past, the pricing of energy has not always reflected either the true costs to the economy or helped to ensure the financial viability of the energy industries. This situation cannot be allowed to continue for long. It is wrong to think that an adjustment in the prices of a basic input like energy would aggravate the inflationary situation; the costs to the economy are not reduced by not reflecting them in proper pricing. Indeed, the continuance of wrong pricing policies has a far more deleterious effect on the health of the economy than is often realised. Given the pressure 01 international oil prices and rising domestic energy costs, a high priority will have to be given early in the Plan period to the evolution of a structure of energy prices which reflects true costs, encourages economy in energy use and promotes replacement of scarce fuels.

New Energy Sources

15.24 As mentioned earlier, India's endowments iof energy resources are by no means large. There are also obvious limitations to the extent to wliich savings in energy consumption could be achieved through conservation. It is apparent, therefore, that if the country's growing demand of energy are to be met, new and renewable sources of energy must be developed. The new energy technologies are particularly suited for the introduction of decentralised or small scale energy supply systems which fit in with India's rural agricultural economy. Remote communities which cannot be reached by an electricity grid except at prohibitive cost or do not have easy access to conventional commercial fuels could, through renewable energy technologies, be provided wirn energy sources ror domestic use as well as tor rural industry and agriculture. In general, these technologies have the additional merit of having less adverse impact on the environment than the conventional fossil fuel systems. Even though the immediate contribution of the new energy technologies to energy supply may be limited and many o'f them are not economically competitive at the moment, there is no doubt that they will play a predominent role in future.

Animal and human energy

15.25 The heavy dependence of the rural economy on inputs of animal and human energy has already been stated. This situation is bound to continue for several decades to come. The main effort would have to be to reduce the drudgery of life in villages by developing devices, e.g., pedal operated mechanisms, which are more productive aad less tiring than hand operated ones. Only some stray efforts have been made so far in t'-.is direction with little impact. The development of technologies which put human energy to more productive use and reduce drudgery needs to be set on a more organised basis with the requisite institutional support. Likewise, efforts should be made to raise the draught power of animals through improved breeds so that they become more efficient converters of fodder into energy.

The Programme

15.26 As mentioned eariier, conventional energy technologies are characterised by long gestation periods. It takes even longer to bring about significant changes in the pattern of energy consumption. Appropriate policy and investment decisions have there fore to be taken without loss of time if the country is to meet the challenge which the energy problem will pose in the coming decades. This concern is reflected in the increased allocation made in this Plan for accelerated exploitation of India's domestic resources of oil, coal, hydro and nuclear power. The scale of the energy forestry and bio-gas programmes is being expanded sharply. Funds have also been provided for a more intensified research, development and demonstration effort in the area of renewable energy technologies, as also for a more efficient harnessing of animal energy. The devils of the programmes and schemes are set out in the sections which follow. As for measures of energy conservation, the need is not so much for Plan investments as for appropriate fiscal policies and establishment of institutional mechanisms for regulation, extension and training. These will be pursued during the plan pehoa.



15.27 The total installed generating capacity which was only 2300 MW in 1950, increased to a little over 31000 MW by the end of March, 1980. The total generating capacity at the commencement of the Sixth Plan was as below:

Table 15.1 Installed capacity as on 31-3-1980 MW

Region Installed capasity
Hydro Thermal Nuclear Total
(1) (2) (3) (4) (5)
Northern 3945-28 4032-94 220 8248.22
Western 1790-30 5624-04 420 7834.34
Southern 4593-23 2613-88 7207-11
Eastern 906-48 3959-28 4865-76
North-Eastern 145-93 188-35 334-28
Total Utilities 11381-22 16468-49 640 28489-71
Total Non-Utilities (as on 31-3-1979.) 2-55 2532-44 2535-00
Total (All India) 11383-78 19000.93 640 31024-71

15.28 During the decade 1970—80, installed capacity has grown at an average annual rate oi 7.2 per cent. While over this period, thermal capacity increased at the rate of 8.0 per cent the capacity of hydro units registered a growth rate of 6.4 per cent. The share of nuclear capacity continues to be modest, accounting for a little over 2 per cent of the total capacity at the end of March, 1980.

15.29 In parallel with the increase in generation capacity, there has been a steady expansion of the transmission and distribution net-works. It is estimated that by March, 1980, the total length of 400 and 220 KV lines was of the order of 33000 ckt. kms., while that of 132 and 110 KV lines was about 58000 ckt. kms. Apart from the increase in number of lines, a significant step in the recent past has been the introduction of 400 KV transmission for bulk power transfer over long distances. Considerable progress has "also been made in the construction of inter-State and inter-Regional lines to facilitate grid operation and transfer of power from surplus to deficit areas.

15.30 As a result of the high priority extended to rural electrification, there has been a spectacular increase in the last three decades in the number ot villages electrified and irrigation pumps energised. This would be apparent from the table bdow:

Table 15.2 Progress of Rural Electrification

Year No. of villages electrified Number of pumps energised
1950-51 3061 21000
1960-61 21750 198704
1968-69 73732 1088804
1973-74 156729 24266133
1979-80 250112 3949120

With a coverage of 2.5 lakh out of the total 5.7 lakh villages in the country, the percentage of villages which have access to electricity has touched 43 per cent. Though, since the commencement of the Third Five Year Plan, the primary focus of the rural electrification programme has been on the stabilisation of agriculture through the exploitation of ground water resources, village electrification gained importance with the introduction of the Minimum Needs Programme in the Fifth Plan, which aimed among other things at providing basic ameni'ies to the rural areas. Since 1973, special schemes have also been introduced for accelerating electrification in the remote and backward areas.

15.31 Substantial as the growth of the 'power sector has been, power shortages have become almost endemic in various parts of the country. The rate of growth of power generation has not matched the growth of installed capacity, much less ihe growth of demand for electricity. There have been persistent delays in construction of projects, the commissioning of new capacity falling short of targets year after year. In the five year period 1974-79, the shortfall in the addition of new generating capacity compared with the target was as high as 40 per cent. Delays in equipment delivery by manufacturers, inadequacies in the organisational capabilities of State Electricity Boards in regard to investigation, project formulation, project implementatton and management, and in a few cases, mismatch between actual flow of funds to Elecetricity Boards and project requirements, have been the major factors responsible for the time and cost over-runs of power projects. The slippages in commissioning schedules Inve been aggravated by deterioration in the performance of thermal power stations, whose plant load factor came down to 45 per cent in 1979-80 as against the peak level of 56 per cent achieved in 1976-77. The abnormal time taken for stabilisation of new generating units, deficiencies in operation and maintenance and inadequacies in coal supply and deterioration of quality of coal, have been identified as the major factors responsible for the sub-optimal performance of thermal power units in the recent years.

15.32 The percentage of energy lost in the transmission and distribution systems continues to be high and has remained at about 20 per cent over the last several years. Non-availability of aluminium, steel, insulators, etc., have adversely affected the progress of construction of major transmission lines. In general, the growth of transmmission and distribution system has not fully matched the expansion of generation capacity thereby affecting both the quality and reliability of supply and posing problems in transfer of power between different electricity systems. While no doubt the growth of rural electrification has been phenomenal when viewed from an all-India angle, a disaggregated analysis discloses wide interstate and intra-State differences in coverage Even in villages to which the power supply lines have been drawn, the proportion of rural families using electricity continues to be quite low and the impact on rural industrialisation has also not been significant. These are all areas of concern which call for remedial action.

PLAN 1980—85 Generation

15-33 Considering the deleterious impact of power shortage on the productive sectors of the economy, the objective has to be to achieve a balance between supply and demand in as short a time as possible. The all-India consumption of electricity in 1984-85 is estimated at 148 Twh. This will require a generation of 191 Twh compared with the actual generation of 112 Twh in 1979-80, implying an average annual growth rate of 11.3 per cent during the Plan period. Taking into consideration the gestation lags in the construction of power projects, advance action had been taken to meet the power demand anticipated to arise during the Sixth Plan period. At the end of March 1980, generatinc cao'acity totalling 29,665 MW had been sanctioned and the project's were in different stages of construction. Of this, it is anticipated that 19666 MW would be commissioned during the period 1980-85 comprising 13.846 MW of thermal, 5130 MW of hydro and 690 MW of nuclear units. As would be apparent from these figures, the bulk of the addition wo-'ld be thermal: bv the end of the Sixth Plan, the proportion of thermal units in the total installed capacity would increase to 65 per cent. The commission-ino programme, while being realistic, is predicated on the maintenance of delivery schedules by the various manufacturers and timely availability of cement, steel, etc. Arrangements for monitoring the progress of the proiects and flow of materials have already been made.

15.34 In a sector like power, it is obvious that planning has to be based on a longer time horizon, specially as the construction period of hydro and nuclear power projects extends well beyond a plan period. The economic perspective indicates a generation requirement of 287 Twh in 1989-9Q and 380 to 400 Twh in 1994-95 which would call for an addition of 20,000 to 25.000 MW of capacity in the Seventh Plan period. Of this the schemes already under construction would contribute about 10,000 MW between 1985 and 1990. For the rest, action will be initiated during the next five years to take up construction of new projects to synchronise with the build-up of power demand. E"-^y effort will be made to give an impetus to hydro power generation since this is a replenishable form of energy. This will by no means be easy; in a situation of resource constraints, high initial costs and lo:^' gestation periods of hydro development can pruve to be formidable hurdles, apart from the fact that the balance of the unexploited potential is largely in remote and inaccessible areas, sometimes also posing major technical problems. In the choice of locations for thermal power stations, preference will be given to pit head sites, but given the rigidities inherent in the pattern of investment flows in the Central and the State Plans as well as technical considerations of system stability and the economics of power transmission, these would necessarily have to be supplemented by some load centre based power stations.

15.35 As explained earlier, it has become necessary to acelerate nuclear power development in the country. While the full benefits of the Rajasthan and Madras atomic power stations would become available during the Sixth Plan, the construction of the Narora Power Station will reach an advanced stage, the first unit at this station going on stream in 1985-86. The PI i makes provision in addition, for investments on phased starts on three more nuclear power stations, each of which would have two generating units of 235 MW capacity. While this would undoubtedly mean a sie-p -iip in the tempo of exploitation of nuclear power. it has to be recognised that in relation to the total capacity of the power systems in India and their rates of growth, the contribution of nuclear power will remain relatively modest in the coming two decades.

15.36 For historical and other reasons, the burden ^f power development has mostly been borne by the Sta»c Governments in the past. To begin with, the role Central Government in power generation was 'ined to the atomic power stations. Thereafter the e entered the area of hydro power development iimfted way, taking up construction of selected projects in the relatively remote areas of the North and the North-east. It was only during the Fifth Plan t^;)) a marked increase in the Central involvement iq power generation was visualised and a beginning made in the construction of super thermal power stations, wh""h would benefit more than one State. For construction, operation and maintenance of thermal and hvdro prniects in the Central Sector, the National Thermal Power Corporation and the National Hydroelectric Power Conroration were accordingly set up. Having regard to the special conditions of the North East-'rn rfgion, another agency, viz., North-Eastern R; ciric Power Corporation was also established to take no the construction of medium sized power projects in the region

15.37 The future approach to the demarcation of responsibilities between the Central and the State Governments in respect of power generation has become a crucial issue for the long-term power planning of the country. Power development has become increasingly capital intensive and the construction of big hydro power projects or large pit head thermal power stations involves investments of an order which is beyond the capacity of individual States. With increasing capital intensity, it has become more important than before that the country should derive optimal benefit by the integrated operation of powar stations, which confer the dual benefit of minimising costs and improving system reliability. Past experience indicates that multiple ownership of power stations and the tie lines leads to almost insuperable technical and commercial problems in the way of truly integrated operation of electricity grids. The Committee on Power (Rajadhyaksna Committee) has suggested that the majority of the new .power stations should be implemented in the Central sector in order that about 45 per cent of the total generating capacity in the country may be under Central ownership and control by the close of the century. The recommendations of the Committee are as yet under examination. Meanwhile, the new Plan seeks to continue the process of enlargement of the Central power sector, though not at the pace contemplated by the Committee on Power. At (present, the total installed capacity in the Central Sector stands at 3277 MW. With the completion of the various schemes already under execution, this will go up to about 7742 MW by 1984-85. Provision has been made in the Plan for taking up the super thermal power stations at Singrauli, Korba, Ramagundam, Farakka and Neyveli to their full capacity; a start has also to be made on a new set of similar stations at other pit head locations. Nuclear power capacity, as already stated, would be expanded. A few hydro electric projects are also slated for Central implementation.

15.38 Installation of captive power stations will be encouraged in industries where there is scope for combined heat and power generation. Captive units will be p trmitted in large power intensive industries such as steel and aluminum which require installation of power Stations of reasonable size and efficiency to cater exclusively for their requirements. Fertilizer and other plants, which have expensive eoaioment sensitive to power system flunctuations would also be allowed the facility of having their own power supply arrangcmeL/ts. In other cases, the present policy of discouragiitg captive units will continue.

15.39 Over the year's, the trend has been to install thermal generating units of increasingly larger capacity in order to take advantage of higher thermal efficiency and accelerate the rate of addition of new capacity. During the Sixth Plan, the overwhelming bulk of new thermal capacity will be accounted for by units of 210 MW each. This plan period will also witness a move to the' next of 500 MW. the first unit of which is being installed in the Trombay power station during 1982-83. Installation of similar units in the second phase of the Central super thermal stations is Programmed. The location of such large units and their phasing would naturally have to take into nccount considerations of system stability.

15.40 With the capacity addition projected in the next live years, there snould be an improvement m tbe power situation in the country by the close of the Jflan. The forecast is that in 1984-85, with the exception ot the Norttiem Region, the energy requirement and peak demand in other regions wuuid be either iuily met or the delicn would be marginal. There would, however, be shortages in the intervening periods in some parts of the country. In the Northern Region, the gap between requirement and availability will not be fully bridged within ihis Plan period. 10 the extent possible, the shortages will have to be met through inter-State transfer of power aad demand management by staggering holidays and working hours, rostering agricultural pump sets, etc.

15.41 The above forecast is predicated on a distinct improvement in the working of thermal power stations. The poor performance of these stations has been the subject of study by various committees and expert groups and the areas where action is needed for enacting improvement have been identified. A project renovation programme is already in progress. Roving teams of experts have been constituted to monitor tiie operation of certain identified thermal stations. The supply of coal and furnace oil is also being closely monitored. Training of engineers and technicians in the operation and maintenance of stations has been intensified. A central bank of critical imported spares is being operated to minimise delays in procurement of spares and thereby reduce the down-time for maintenance. Steps have also been taken for design improvements and greater attention to quality control in the process of manufacture. All these efforts, it is expected, would lead to higher availability of thermal power sets in the coming years.

Transmission and Distribution

15.42 Besides maintenance of the tempo of expansion of EHT, sub-transmission and distribution lines coHMnensurate with the growth of generation capacity, uk a»ost significant feature of the 1' and D programme hi the Sixth Plan will be the proliferation of the 400 KV system. Long term power system studies have been carried out and are being constantly up-dated to evolve the configuration of the major 400/220 KV tines needed for evacuating power from generating stations and to establish inter-grid and infra-grid linkages. Several of the State electricity Boards have already initiated steps to develop design, construction and erection capability required for 400 KV lines.

15.43 Considerable progress has besn made in the establishment and operation of the five regional electricity grids. While the Southern Region Load Despatch Caitie has become fully operational, interim RLDCs are functioning in the other regions. Construction of the permanent RLDCs and procurement and installation of equipment have reached an advanced stage. The permanent RLDCs are expected to attain operationality by 1983.

15.44 The regional grids have ultimately to be welded into a national grid, -which would enable the country to get maximum benefit from the complementarity of the electricity generating potential in different pans of ttie country and the diversities of system demands. The dinerent segments which would coiib-titute the national net-worK have been idenutied through the. long-term system studies reterred to earner. Some of me lines which fit into this net-^urk nave already eitner been completed or are under constructioi.. Some more would be added in ttie commg five years. Toere are, however, major operational and tecnnical problems involved m grid operation, whether a; the regional or the national level. One 01 me major recommendations of tha Rajadhyakiha Committee is that the ownership and operational cun-trol of the RLDCs and the key transmission hues should be with the Centre, with power to regulate me generation pattern, tie-line flows, etc. Involving as it does a major change in the structure of the elecincuy industry, tins recommendation needs to be examined m consultation with the States. Provision has been inaue in the new plan for the construction of some of tnese lines in the Central sector.

15.45 As mentioned earlier, the T and D loss in most of tne Slate electricity systems continues to be at a fairly high level. An increasing proportion of iiiduc-live coiineilt.d loads, over-extended distribution lines, inadequate transformer capacity and the inabiliy o transmission lines to cope with the increasing icwl have resulted in poor voltage conditions and imen'up tions of supply specially in the rural areas. Reduction ot system losses and improvement in the quality of supply call for systematic planning of the T and U system and a continuous programme of system. Im-provment which comprehends all the stages starting trom the power station busbars to the consumer outlet. The State Electricity Boards, it is expected, would give as much attention to the improvement of the T and U net-work as to addition of new generating capacity.

Rural Electrification

15.46 With the ground water potential available 'si the country, it is estimated that there is scope tor installation of 120 lakh pump sets spread over the dinerent parts of India. It is, therefore, proposed to energise 25 lakh pump sets during the Sixth Plan iu addition to nearly 40 lakh electrical pump sets isi operation at the commencement of the Plan period. Special attention would have to be paid to pump set energisation in the States of U.P., Bihar, West Bengal, Orissa and Madhya Pradesh which still have a large untapped ground water potential. While the Rural Electrification Corporation would step up its assistance to State Electricity Boards to take electricity to new rural areas, the programme of energising pumpsets is expected to receive a boost from a scheme initiated iwo years ago of pint financing of a special programme for agriculture by REC, ARDC and commercial banks.

15.47 The target for village electrification under ihfc Sixth Plan has been fixed at one lakh villages. A part of this target would be accounted (free under Minimum Needs Programme, which would1 cover( 46,000 vi Bages. A mujoc propoilion ot the MNI* target fies in U.P., M.P., eastern and north-eastern India. Having regard to the thin population density, difficult terrain, etc., in the north-eastern region and in other hill and tribal areas, the Rural Elecrification Corporation has liberalised its criteria for judging the viability of rural electrification schemes prepared for such areas in order to facilitate the extension of electrification to them. The Corporation is also operating a special programme for electrification of Harijan bastis all over the country. Schemes for extension of electric supply to small-scale and tiny industries in the rural and semi-urban areas have also been introduced.


15.48 Recognising the importance of training engineers and technicians at all levels for efficient operation and maintenance of power stations and the transmission and distribution lines, a fairly extensive training network has already come up in the country. A number of State Electricity Boards have set up their own training establishments, specially for the first and second level operating staff. In addition. Government of India set up some time ago four thermal power station personnel training institutes in the context of the induction of large sized thermal sets based on sophisticated technology. A power system training institute to cater for the training requirements of EHT systems and a hot line training centre for training personnel in the modern techniques of live line maintenance are already in operation. These facilities, however, have been found to be inadequate in terms of both quality of training and capacity to meet the increasing need for trained personnel. In order to bring .ill the Central training establishments under unified control and management and with a view to give concerted attention to their improvement and expansion, the Power Engineers Training Society has recently been constituted as an autonomous body. The Sixth Five year Plan makes provision for new schemes to be implemented by the Society, including the installation of simulators.

Research and Development

15.49 The major R and D activities in the power sector have so far been carried out by the Central Power Research Institute and the Central Board of Irrigation mid Power (OBIP) through the agency of the State Electricity Boards and research institutions, apart from equipment R and D carried out in-house by the major manufacturers, While the studies sponseored by the CBIP have mostly been on operational problems, the thrust of the work in the CPRI has been on material testing, such as of transformer oils and insulation materials. However, in relation to the massive investment being made on the power sector, the overall R and D effort has remained inadequate. There has also been insufficient involvement of existing research and academic institutions such as IITs and Regional Engineering Colleges in tackling R and D problems of the power sectors. Beside increasing the financial allocation for S and T programmes in this area, it is proposed to strengthen the institutional arrangements for carrying out an effective R and D programme.

Organisation and Management

15.50 Among the major recommendations of the Committee on Power arc those relating to the restructuring of the State Electricity Boards, which will continue to shoulder the major responsibility for implementing the ambitious 'ptower programme projected in the coming years. The Committee has made detailed suggestions regarding the composition of SEBs, manner of selection of the top personnel, improvement of management systems and procedures and information and control systems. It is important that measures for strengthening the organisation capabilities of the SEBs are implemented expediti-ously. Attention would have to be given to the improvement of systems and procedures for project formulation and implementation, monitoring and inventory control. Also, the formation of specialist cadres within the the staff of the Boards which has already been accepted by the States, needs to be pursued vigorously

Financial Performance

15.51 As is well-known, most SEBs are operating at loss and the losses have been on the increase from year to year. The total commercial loss of the SEBs which was about Rs. 103 crores in 1973-74 increased to about Rs. 450 crores in 1979-80. High capital costs caused by delay in completion of projects, high overheads caused by over-staffing, high operating costs on account of low capacity utilisation and a tariff structure which continuously lags behind the rise in incremental costs, have been mainly responsible for the increase in losses. Though the Electricity Supply Act was amended some time ago to make it mandatory for a SEB to earn a positive return, there is no noticeable sign of improvement as yet. The investments in the power sector are rising at a rapid rate which makes it imperative that the industry should meet a sizeable proportion of its investment requirements through generation of internal resources. The Committee on Power has recommended that the power utilities should aim at generating internally about 50 per cent of the resources required for their expansion. A carefully worked out package of measures to improve the financial condition of SEBs needs to be 'put into action by the State Governments without further loss of time.

Targets and outlays

15.52 The physical targets and financial outlays under the various categories are set out in the Table below:

Table 15.3 Sixth Plan Outlay On Power (Rs. crores)

Item States U.Ts. Centre Total
1 Generation 8002 59 3791 11852
2 Transmission and Distribution . 4548 159 705 5412
3 Rural Electrification 1559 17 1576*
4 Miscellaneous 184 12 229 425
Total : 14293 247 4725 19265

"Exclusive of the outlay included in Rs. 285 erores fur Special Project Agriculture (SPA) (rec' s share). Rural Cooperatives, System Improvement Schemes and Harijan Basties.

Table 15.4 Expected Generating Capacity by 1984-85 (MW)

Utilities Hydel Thermal Nuclear Total
Northern Region 5240 7743 440 13423
Western Region 2247 11104 420 13771
Southern Region 6798 4504 470 11772
Eastern Region 1409 6779 8188
N.E. Region 457 546 1003
All India (utilities) 16151 30676 1330 48157
Non-utilities 3 3032 3035
All India (including non-utilities) 16154 33708 1330 51192

Capacity additions planned during the period 1980— 85 from the projects which are in the implementation stage are shown in Annexure 15.1. me State-wise installed capacity by the end of 1980—85 is given in Annexure 15.2 and the State-wise outlays are set out under Annexure 15.3.



15.53 The need for systematic and scientific development of the coal industry has been recognised from the inception of the process of national economic planning in the country. Over the successive Plan periods, several measures were introduced to up-grade our knowledge of the coal resources, introduce scientific classification, promote conservation, imp'rove mining techniques, regulate distribution, optimise utilisation and stimulate research and development covering all the facets of the coal industry. These measures could not, however, achieve full impact 'since the coal industry was almost wholly under private ownership and management which tended to adopt a profit-oriented approach without always taking note of the long term interest of the industry. As the first major step towards achieving the objective o£ u sound development of the coal industry in India through the induction of the public sector, the National Coal Development Corporation was set 1956. But it was not until the nationalisation of coal mines in 1972 and of non-coking coul mines 1Q73 that a comprehensive programme of development of coal mines which covered introduction of newer production technologies, standardisation of equipment and development of infrastructure facilities, together with a significant step up in social security and welfare measures for the coal mines, could be initiated.

15.54 Coal production, which stood at 33 million tonnes at the beginning of the First Five Year Plan, rose to 78 million tonnes by 1973-74, the terminal year of the Fourth Plan. The production build up during the successive Plan periods was as follows:—

Table 15.5 (Million tonnes)

Plan period (Terminal year) Production Target Actual Production
Public Privata Total
1955-56 (First Plan). 39-0 4-6 33-7 38-3
1960-61 (Second Plan) 60-0 10-7 43-1 53-8
1965-66 (Third Plan) 97-3 13-7 54-1 67-8
1973-74 (Fourth Plan) 93-5 75-6 2-6 78-2

Following the dramatic increase in oil prices in 1973-74, the Fuel Policy Committee had underscored the imperative necessity of giving a major push to coal development in the country. It was against this background that, compared with the public sector outlay of Rs. 110 crores in the Fourth Plan, the outlay for the coal sector in the Fifth Plan was raised to Rs. 1025 crores. Through reorganisation and reconstruction of existing mines and the introduction of new methods and techniques in the development of mines, production was raised by as much as 22 million tonnes in the first two years of the Fifth Plan period, the hundred million tonnes level being touched in 1975-76. But, on account of recession in certain sectors of the economy, the production outpaced demand, with the result that pit-he-ad stocks accumulated to the extent of 14.6 million tonnes by the end of 1976-77. Considering the trends in the pattern of demand, the requirement of coal at the end of the Fifth Plan (1978-79) was reassessed at the mid-term review at 124 million tonnes as against 135 mt. visualised at the beginning of the Plan. The later half of the Fifth Plan period' witnessed a reversal of the situation; the demand for coal built up once again, but production failed to pick up and stagnated at around 101 million tonnes a year. The continuing coal shortage had a pervasive impact on the overall economic growth of the country. An analysis of the reasons for the non-materialisation of the production targets revealed that v/hile deficiencies in internal management at different levels was a contributory factor, the major factors which impeded increase in coal production were shortage of power, absenteeism and labour unrest, shortage of explosives and bottlenecks in the movement of coal. In 1978-79, the loss of production on account of these constraints which were external to the industry, is placed at 16 million tonnes.

15.55 The pattern of coal consumption has undergone a signiricant change during the past two' decades. Till the beginning of the Second Plan, Railways were the single largest consumer accounting fur a third of the total consumption. With increasing dieselisation and electrification, the consumption of coal by Railways has been declining steadily. On the other hand, the demand of coal by steel industry and for power generation has increased sharply, other major consumers being cement, fertilizers, textiles, paper and brick manufacturing industries.

PLAN 1980-85


15.56 By the end of ihe Sixth Plan (1984-85), the demand of coal is expected to be 173 million tonnes (Raw Coal: 168 million tonnes and washery middlings: 5 million tonnes), the sectoral break-up of which is as shown in Table 3.13 in Chapter 3.


15.57 From a consumption level of around 102.6 millioa tonnes in 1979-80, the demand is expected to rise to 168 million tonnes in 1984-85. A tentative estimate places the demand at the end of the

Table 15.6 (In'000 metres)

Company Drilling meterage
Eastern Coal fields Ltd. (E.C.L.) 380-5
Bharat Coking Coal Ltd. (B.C.C.L.) 357-5
Central Coal fields Ltd. (C.C.L.) 293-0
Western Coal fields Ltd. (W.C.L.) 447-0
Sub-total-Coal India Ltd. (C.I.L.) 1478-0
Singareni Collieries Co. Ud.(SCCL) 190-0
Total : 1668-0


15.58 Compared with the actual 'production of about 104 million tonnes of coal in 1979-80, the increase in production during the Sixth Five Year Plan would have to be about 64 million tonnes, if the anticipated demand of 168 million tonnes in the terminal year of the Plan period is .to be fully met. The gross increase in production would, in fact, have to be higher. This is because of the natural process of depletion in the existing mines, which accounted for almost 80 per cent ot the production in 1979-80. Although a large number of reconstruction and new projects, with a cumulative capacity of about 80 million tonnes, have been sanctioned between 1974-80, the contribution from these mines will not fully meet the gap between demand and availability on account of gestation lags. Experience has shown that the period required to achieve the targeted capacity ranges from 5 to 12 years, depending on the nature of the project. Further, it is considered unlikely that constraints such as shortage of power in some of the major coal producing areas in the country will totally disappear within the remaining 'years of the Plan period. There are also limitations to the extent to which the demand for the different grades of coal can be exactly matched with the production programme. Taking into account all these factors as also the current status of development of various categories of mines, it may not be prudent to expect more than 165 million tonnes of usable production in 1984-85. Even to achieve this level of production, the contribution from new projects which are yet to be approved, bat on which some amount of preliminary work has already been initiated, has to be around 21 million lonnes. The company-wise break-up of production in 1984-85 is projected as below:—

Table 15.7 (Million tonnes)

  Existing mine* Sanctioned projects Projects to be sanetion-ned Total
1 E.C.L. 17-58 9-50 4-50 31-58
2 B.C.C.L 15-44 7-60 3-71 26-75
3 C.C.L 11-40 24-30 7-30 43-00
4 W.C.L 14-16 24-03 3-52 41-68
5 N.E.C 0-03 0-97 1-00
Sub-total-C.I.L 58-61 66-37 19-02 144-00
6 S.C.C.L 8-32 6-50 2-17 17-00
7 TISCO/IISCO (Private sector) 4-00 4-03
Total : 70-93 72-87 21-20 165-03

This will leave a small gap of about 3 million tonnes between demand and availability, the entire gap being in respect of non-coking coal. As regards coking coal, indigenous production is to be supplemented by import ot superior quality prime coking coal. The Plan visualises that such imports will continue throughout the Plan period touching a level of 2 milion tonnes in 1984-85. These imports are intended not only to insulate the steel industry from the vagaries in coal production but to upgrade the quality of coke oven feed in the steel plants. Viewed overall, the small gap in coal availability would have to be bridged, to the extent possible, by timely adjustments in the production and consumption patterns.

15.59 The need for introducing new mining technologies in order to be able to secure rapid increases in production of the order visualised in the Plan has been recognised and provisions have been made in the Plan to "bring about an appropriate change in the production mix from different categories of mines. Thus, the production strategy in the new Plan visualises the opening of a large number of open cast mines-some of them of large capacity in the range of 6 to 10 m'llion tonnes which not only have the advantage of relatively low gestation periods but also of higher recoveries of coal. In these mines, equipment of higher capacity will be deployed to ensure speed and economy. In tlie underground mines, there is to be a phased mechanisation of the Bord and Pillar system of mining which currently contributes around 70 per cent of the total production, progressive expansion of long-wall methods of mining and adoption pf advanced methods of extraction of thick seams by caving. A start may also be made on hydraulic mining in selected areas. Assistance is being obtained from a number of countries for technological upgradation in selected aspects of Indian coal industry. The new technologies would also improve working conditions, raise safety standards, reduce human drudgery, enhance productivity and lead to .better conservation of coal. The Plan provides for strengthening the infrastructure of the industry as a whole. Apart from installation of about 50 MW of captive power generation in order to provide short-term relief to vital installations in the Eastern coal belt, important roads in the Jharia field are to be improved and new rail lines and sidings constructed wherever needed. For the first time, a fairly large programme for the control of fires in the Jharia field is being launched. A start is also to be made on the reconstruction of Jharia coal field, which is the main source of prime coking coal in the country and for which an ambitious master plan has been drawn up.

15.60 Special importance has been attached in the Plan to various measures to improve the working conditions, ensure safety and augment the existing facilities for promoting the welfare of the workers.


15.61 Consistent with the increased demand for coking coal for the steel industry, the washery capacity in the country is to be raised from 27.8 million tonnes to 36.5 m'llion tonnes by 1984-85. Approval has already been given to the construction of 5 new washeries with a through-put capacity of over 8.7 million tonnes of raw coal. Besides, a start will be made during the Plan period on new washery projects which will be needed for meeting the demand arising in the post Sixth Plan period.

15.62 Proposals are als3 under consideration to introduce simple methods of upgradation of non-coking coals to ensure supply of uniform grade and size of coal to selected power stations.

Research and Development

15.63 The plans for the rapid growth of the coal industry wiU be accompanied by an intensification of the research and development programme m the coal sector. There are already 92 research projects under implementation; besides, new projects will be initiated through CFRI, CMRS, CMPDI and other research and academic institutions. Introduction of new mining techniques, methane drainage, dry deshaling of non-coking coal. use of coal fines and fluidised bed combustion will be among the major areas of study.

Plan Implementation

15.64 The principal problems facing the coal industry in the short run are inability to meet demand, cost and time over runs, deterioration in financial performance and r'sine; capital costs. The long term issues certain to changes in technology, self-reliance in mining equipment and retraining of manpower. The Plan therefore lays emphasis on the need to strengthen the management structure of the companies to enable effective monitoring, systematic cost analysis and close financial control. Considering the massive investments being made in the coal industry, structural changes needed to strengthen and streamline the managerial pattern of the coal companies would also need to be carried out expeditiously.


15.65 The first phase of the integrated project of the Neyveli Lignite Corporation consisted of a mine with an ultimate capacity of 6.5 million tonnes per annum and downstream units comprising a 600 MW thermal station, a fertilizer plant with a rated capacity to produce 1.52 lakh tonnes of urea per annum, a briquetting and carbonising plant to produce 3.22 lakh tonnes of carbonised briquetts per annum and a clay washing plant with 6000 tonnes of washed clay per annum. Due to constraints in the capacity of the mining equipment as well as adverse overburden ratios etc., the output of lignite did not reach the anticipated levels of production. In order to augment the production and achieve the targeted capacity of 6.5 million tonnes, Government sanctioned schemes for procurement of additional specialised mining equipment.

15.66 The actual production of lignite as compared to the targets from the year 1975-76 to 1979-80 were as indicated below:—

Table 15.8 (Million tonnes)

Year Target Actuals
1975-76 3-00 3-03
1976-77 3-60 4-02
1977-78 3-75 3-58
1978-79 3-75 3-30
1979-80 4.03 2-90

The production in 1979-80 received a serious set back due to heavy rains which had thrown the mining operations completely out of gear. Nevertheless, with the commissioning of the three systems of equipment for augmentation of production, it is now expected that the production from the first mine will reach its full capacity of 6.5 million tonnes by 1982-83.

15.67 The Plan has also provided for the development of a second lignite mine with a capacity of 4.7 million tonnes per annum to meet the requirements of a new thermal power station of 630 MW. Orders have already been placed for specialised nrning equipment for the second mine cut. Similar action has been taken in.the case of the new thermal power station.

15.68 In the Sixth Five Year Plan, provision is made to initial e action for stepping up the capacity of the second mine from 4.7 to 10.5 million tonnes to enable doubling of the capacity of the new power station. The Plan also provides for exploration for proving reserves for a possible third mine and preparation of feasibility reports for the opening up of a third mine and construction of a fertilizer plant.

15.69 Provision has also been made in the State Plans for Gujarat and Rajasthan for the development of lignite mines to match the requirements of linked power stations. The total production of lignite at the end of the Plan period from the Central and the State undertakings is expected to be 8 million tonnes.

15.70 For the various programmes of development in the coal and lignite sectors, a provision of Rs. 2870 crores has been made in the Plan, the details of which are set out in Annexure 15.4.



15.71 The spurt in industrialisation and the general intensification of the country's economic activities which followed Independence led to a rapid growth in the consumption of petroleum products. To match the demand and yet reduce the dependence on imports, it was felt necessary to explore for oil and establish adequate indigenous resources. The Oil and Natural Gas Commission (ONGC) and the Oil India Ltd. (OIL) were formed" in 1956 and 1959 respectively to accomplish this task. While OIL was given the responsibility for intensive exploration in a part of Upper Assam which held promise of high potential, ONGC was given a much wider charter, with its area of operation covering the rest of the country. Both these organisations soon met with success and a number of oil and gas accumulations were discovered in the years that followed, mainly in the Cambay area of Gujarat and in Upper Assam. By the end of the Third Plan, about 172 million tonnes of initial recoverable reserves had been established. While this went upto 195 million tonnes in the period 1969-74, the exoloration in the Fourth Plan was marked by ONGC going out-for offshore drilling, first at Aliabet and ihen i'n the Bombay offshore area—the latter resulting in the discovery of the large Bombay High oilfield. Encouraged by these developments and with a view to intensifying exploration of oil. outlav for it was significantly enhanced in the Fif'h Plan. Further exploration in the Bombay offshore region resulted in the discovery of a number of oil and gas fields like North Bassein, South Bassein, South Tapti, B-37, B-38, etc. On land. sig^ficant additions to oil reserves were made both in the Cambay and the Assam—Arakan basins. Oil was discovered at Kharasin? in Arunachal Pradesh by Oil India. By 1-1-1978, the total initial recoverable reserves had increased to about 452 million tonnes.

15.72 During the period 1978-80, oil exoloration continued to receive high priority. On land, exploratory activities in the prospective Assam-Arakan region were considerably stepped up until the widespread disturbances in the region towards the end of the year 1979 impeded the progress. While a brisk pace of exploration was maintained in the. western region, a cautious approach was adopted in other areas on account of the high risk to reward ratio. Offshore, detailed seismic surveys were conducted over a large part of the continental shelf. Exploratory drilling was done by ONGC in the Bombay offshore area and off the Godavari basin, Kerala coast; and Managalore coast. The outstanding discoveries made during the period were of oil and gas in the Godavari basin and of oil, at Ratnagiri-9 and Ratnagiri-12 structures. Oil India also began offshore exploration in the Mahanadi delta. As a result of the efforts of the two organisations which by the end of the year 1979-80 had together drilled over 3100 wells totalling about 4.9 million meters, the inventory of geological reserves of oil reached over 2.3 billion tonnes, of which 478 million tonnes were considered recoverable. The balance of recoverable reserves of oil, as on 1-1-1980, stood at about 360 million tonnes.

15.73 The establishment of additional oil reserves enabled augmentation of indigenous production. Starting from a meagre 0.45 million tonnes in 1960, domestic crude production went up to 5.6 million tonnes by the end of the Third Plan, 7.2 million tonnes by the end of the Fourth Plan and 11.77 million tonnes by 1979-80. Upto 1975-76, the production of oil was exclusively from the on-land fields of Cambay and Assam-Arakan basins. Thereafter,' an increasing contribution has been made by the Bombay High offshore field which attained a production potential of 5.0 million tonnes of oil per year after the completion of the Phase III-A of the development in December, 1978. Oil and associated gas from Bombay High are being pumped through submarine pipelines to Uran on the mainland, where facilities for crude stabilisation, ^as fractionation, etc. are being established.

15.74 The consumption of petroleum products, which was 5.2 million tonnes in 1956, registered a more than four-fold increase by 1973 when it touched 23.7 million tonnes. After a brief respite—due to price increase—when it remained static around 23 million tonnes, the growth in consumption has been quite perceptible being 25.4 million tonnes in 1976-77, 27 million tonnes in 1977-78, 28.0 million tonnes in 1978-79 and 29.65 million tonnes in 1979-80.

15.75 The total refining capacity in the early fifties stood at 0.25 million tonnes per annum. During the Second Plan, three coastal refineries were set up in the private sector adding about 6.2 million tonnes per year (mtpa) to the crude throughput capacity. In the Third Plan, three inland refineries were set up at Gauhati, Barauni and Koyali in the public sector raising the crude throughput capacity to 10.2 mtpa. In the Fourth Plan, with the expansion of existing refineries and establishment of two coastal refineries at Cochin and Madras, the total refining capacity reached 24 mtpa. Under the Fifth Plan, another refinery in th@ public sector was set up at Haldia and some marginal expansions were efiected at Barauni and Koyali taking the total refining capacity to 27.8 mtpa by 1977-78. A 3.0 mtpa expansion at Koyali was completed in October, 1978, but the Bongaigaon refinery^ which was also to be completed during this Plan, got delayed. The Crude Distilla;iun Unit of this refinery was iater completed and commissioned in February, 1979. Although this has raised the nominal installed capacity to 31.8 mtpa, ihc refinery cannot run at full capacity unless the Delayed Coker Unit is also completed. The Mathura Refinery with 6 million tonnes of installed refinery capacity, which was to be completed by the end of 1979, slipped due to power shortage and other problems, The effective refining capacity at end of the year 1979-80 was 27.5 million tonnes in terms of crude throughput and 25.8 million tonnes in terms of product yield. During 1979-80, due to agitation in Assam, the Bongaigaon Refinery closed down in December, 1979 and the Barauni Refinery had also to be shut down in January, 1980. Refineries at Digboi and Gauhati worked only intermittently.

15.76 With a view to meet the increasing demand of middle distillates, a number of schemes for installing secondary processing facilities with expansion in capacity at low cost have been identified. Some of these have already been approved and are in various stages of implementation. It is expected that on completion of all these schemes, another 12 milio -tonnes will get added to the capacity and the yield o^. middle distillates will also be significantly augmented.

PLAN 1980-85


15.77 It is estimated that the demand for petroleum products may reach a level of 45.50 million tonnes by 1984-85. Projections of demand for petroleum products in the post Sixth Plan period indicate a requirement of 62 million tonnes by 1989-90 if the present trends were to continue. That a demand of this orc:;r cannot be met is obvious. It would call for import of crude oil and petroleum products of an order which would not be available in the international market and even if it were, the cost would be well beyond what the country can afford. The need to control the demand by a combination of steps to improve the efficiency of energy use, replacing of oil by other fu "Is where feasible and by the use of the price mechar's:n has been set out earlier in this chapter. But, gnca the stage of development of the country and the limited technological options specially in the transport sector, holding the demand for petroleum products to a manageable level will pose a formidable challenge.


15.78 The imperative need to develop indigences resources of oil and gas in the context of the rising domestic demand for petroleum products, the cscalat-'ing price of oil in the international market and depleting global supplies, have. already been referred to. In the next five years, therefore, efforts for both exploration and development will have to be greatly intensified and for this the capabilities of ONGC and Oil Indi;' will have to be stretched to the full. ONGC and Oil India have drawn up ambitious programmes for en-ploration both on-shore and off-shore. On-shore, a concerted effort wii! be made in the Assam-Arakan basin by Increasing the numbers of seismic parties and drilling rigs. The exploratory drilling of 97 wells comprising 3UO,000 metres by ONGC and 34 wells comprising 113,500 metres by Oil India has been envisaged during the Plan period. The pace of exploration in the Cambay basin will be maintained. Some of the promising areas, like shoais and estuaries, which could not 'be taken up hitherto due to logistic problems. will also be explored by engaging, where necessary, specialised contracting agencies equipped with facilities to do so. Exploratory activities in the Krishna-Godavari and Cauvery basins, where the presence of hydro-carbons in significant quantities has been established, will be enhanced to assess the extent and commerciabihty of these deposits. Exploration in West Bengal, Ganga valley, Himalayan foot-hills, Rajasthan, Orissa coast and other areas will be suitably stepped up. The total exploratory drilling envisaged by the two organisations i.n the on-land basins is of the order of 300 wells comprising 882.700 metres.

15.79 Oil-shore Oil India will continue with their exploratory programme in the Mahanadi delta area. Further programme in this area will depend upon the results of this drilling. ONGC will continue exploring the Bombay off-shore basin, extending the limits beyond 300 metres water depth. They will also be exploring the structures off-snore of Saurashtra and in the Gulf of Kutch, Andaman and Nicobar shelf, as well as in the east coast basins like Palk Bay and Krishna-Godavari basins. Within this Plan period, all the detailed work required in the Continental shelf and beyond upto 500 metres water depth will be completed, besides 'some regional surveys in still deeper waters. ONGC will increase the number 'of off-shore rigs deployed so as to drill about 95 wells in different off-shore areas during this period.

15.80 In order to supplement the efforts of ONGC and OIL, selected 'blocks are proposed to be leased out to reputed foreign oil companies in participation contracts or joint ventures.

Development and Production

15.81 On-shore, the prodiiciiun from Nahorkatiya and Moran oilfields of Oil India is declining. A production rate of 2.83 million tonnes per annum will, however, be maintained by further development of the Jorajan field. The balance requirement of the refineries in the eastern sector will be met by expansion of production from ONGC's fields in that region, for which additional developmental wells and other production facilities will be installed. The production from the Ankleshwar field will be reduced from 2.0 infpa to 1.4 mtpa during this period, with a view to conserve the crude for the WCUs detergent alkylate plant. Production from North Gujarat oil fields will, however, be maintained at 1.4 mtpa level. A number of structures /fields in the Cambay basin will be developed in this period. Suitable enhanced recovery methods will also be introduced in a few fields.

15.82 The Bombay High off-shore field is being developed in phases. Phases I, II and 1II-A have already been implemented creating a production potential ot 5 m-ipa. Phase 11I-B is under implementation; it comprises installation of 6 well platforms and a major process platform (BHN), drilling of 24 development wells and establishment of terminal facilities for crude stabilisation, gas fractionation etc. With the completion of this Phase by December, 198U, a production potential of 7 mlpa would be 'achieved. Phase IV envisages installation of 10 well platforms and another major process platform (,BHS), drilling of 44 developmental wells and creating other matching facilities. With its completion, a production potential "of 12 mtpa would be established by mid-I9y2 with nearly equal contributions from the northern part and the central/southern part of the field. As a part of Phase V of Bombay High Development, which is designed primarily for sustaining production, certain facilities for water injection in the central/southern part are being established. The advance action on Phase V comprises installation of one water injection platform, laying of water injection lines to well platforms, conversion of production welis to water injection wells, installation of additional well platforms and drilling of 20 developmental wells. The balance activities of Phase V would include provision for water injection in the remaining part of the field.

15.83 Besides the full development of Bombay High field, development of other structures, namely R-12, South Bassien and North Bassien fields, B-37 and B-38 structures, would also be carried out during the Plan period. ONGC have also indicated the need for acquiring certain other capital items as back-up facilities for their off-shore programmes. These include additional jack-up rigs, helicopters, supply boats, multi-purpose vessels, etc.

15.84 The targets of, production and its break-up area-wise and year-wise are given at Annexure 15.5.


15.85 By the beginning of 1982-83, with Mathura Refinery going on full stream, the crude throughput will go upto 34 million tonnes, while the indigenous availabililty of petroleum products will increase to about 32 million tonnes. The demand is, however, expected to reach a level of 39 million tonnes by then. Given the scenario of an inevitable growth in the requirement, additional refining capacity will need to be established especially if the dependence on import of products is to be reduced effectively. Having regard to this and the need to maximise the yield of middle distillates, a number of schemes for expanding the capacity of existing refineries and providing them with secondary processing facilities have already been taken up. These would start materialising towards the end of 1983-84 taking the crude throughput to 38 million tonnes by the end of the Sixth Plan, Nevertheless, even after the completion of these schemes by 1985-86, the availability of petroleum products will increase to only about 41 million tonnes against a demand of 49 million tonnes. It will be necessary to instal additional refining capacity ot 9 million tonnes by 1985-86 to keep the need for import of products at a manageable level.

Lube Oils

15.86 Presently, Lube base-stocks are manufactured in three refineries namely, Haldia, Madras and Bombay (HPCL), and the total capacity is about 0.5 million tonnes per annum. It is estimated that the demand for these would reach 0.57 million tonnes by 1981-82 and would rise to 0.7 million tonnes by 1984-85. To meet this growing requirement, the capacity of these lube refineries will be suitably expanded during the Plan period.

Optimal Utilisation of Gas

15.87 With the availability of fairly large quantities of 'associated gas' and much larger quantities of 'free gas' from the Bombay and South Bassien fields respectively, the manner of their optimal utilisation has been studied in detail. A similar study has also been carried out in respect of gas available in the Assam area. These studies indicate that the most economic use of gas wonkl be as feed-stock tor manufacture of nitrogenous fertilizers, after extracting the propane and butane fractions for manufacture of LPG and ethane and propuii^ fractions for feedstock for petrochemicals. Keeping this in view, programmes have been drawn for setting up large size gas based fertilizer plants on the west coast at Thal-Vaishet and Hazira. A scheme for transporting gas through pipeline further north with a view to set up similar fertilizer plants in Rajasthan, Madhya Pra-desh and Uttar Pradesh is under consideration. An examination is also being made for setting up LPG extraction facilities and gas crackers. The expansion of the fertilizer plant at Namrup, based on gas available in Assam, has also been accepted and Oil India is setting up an LPG extraction plant at Duliajan.


15.88 The need to augment the inventory capacity both for crude oil and petroleum product's has been felt for long. The refineries using imported oil have, in the past, faced considerable difficulties due to irregularities and uncertainties in the supply of crude oil. Recently developments in the Middle East have imparted an added urgency to the need for establishing adequate tankage for storing crude oil and petroleum products. The storage capacity would therefore be increased with a view to reduce the vulnerability to fluctuations in the international supplies.

Product Pipelines

15.89 With the growth in the requirements, progressively larger quantities of petroleum products will have to be moved to various areas. However, difficulties are already being faced in certain areas in meeting the requirements due to transport bottlenecks. 'When the quantities involved are sufficiently large, pipelines are known to be the best mode for transporting liquid petroleum products as these not only ensure regular supply but also prevent loss oS, products and are most economi'; from the point of view of cost as well as the total energy consumption. With this in view, four product pipelines vi2., Bom-bay-Pune, Bombay-Manmad, Cochm-Coimbaiore-Erode and Madras-Bangalore are being


15.90 With the installation of additional refining capacity and new cracking units, the production of liquilied petroleum gas (LPG.) will go up significantly by 19^5-86. Apart from refineries, fairly large quantities of 'LPG' will also be extracted from natural gas, 'LPG' is largely consumed as cooking gas and replaces kerosene. S>cn and mes lor marketing this added quantity of 'LI'G' have already been introduced, but will need to be expanded during the Plan period.

Other Marketing Schemes

15.91 The marketing companies will have to create necessary infrastructural facilities to handle future marketing volumes. The more important of these are developing additional facilities at major installations and bulk depots and opening of retail outlets, consumer depots, consumer pumps and kerosene depots in hilly and far-nung areas.

Research and Development Programmes

15.92 Oil and Natural Gas Commission have set vp Institute of Petroleum Exploration (IPE) and Institute of Reservoir Studies (1RS), the former for carrying out research in the field ot exploration and production while the latter is for studies connected with production and reservoir development. They are also setting up another institute, the Institute of Drilling Technology (IDT) where research and development work connected with drilling technology is being taken up. IPE propose to conduct a large number of studies which aim at adopting- an integrated, mult--disciplmarv approach to study basic issues connected with petroleum genesis and accumulation. 1RS, while handling problems connected with reservoir development, will concentrate on their programmes of developing enhanced recovery techniques for different oil fields. The main feature of the programme of the IDT will be to study the problems of drilling deep weiis. Developmental activities envisaged in the three institutes also include import substitution and development of indigenous equipment. In the field of oil refining, the Indian Institute of Petroleum (IIP) will be the prime organisation to conduct research and development activities though some work will also be carried out by 10C (R and D Centre), Engineers India Ltd. and other organisations. The main areas of research would be thermal and flrid catalytic cracking catalytic reforming, solvent de-waxing/de-oiling, hydio treating and sweetening of various petroleum products. To carry out the above studies IIP will set up semi-commercial pilot plants next to Koyali Refinery, Concerted effort will also be made to develop caialysts required for various processes. It is sug-g"?'-ed to set up a special cell in the Ministry of Peiioieum to coordinate and oversee the R and D programmes being carried out by the various agencies, both in the field of exploration and production and in o'! refining.

15.93 There is a total provision of Rs. 4300 crores for the petroleum sector in the Sixth Plan. Details are at Annexure 15.6.


15.94 The broad approach for the development of new and renewable sources of energy in the Plan will be:—

(a) to implement on a large scale programmes such as those of energy forestry and biogas where technology development has already reached a stage which permits field application;

(b) to carry out field testing and demonstration on a country-Avide basis of technologies, which have the potential to become commercially viable in the next five to seven years; and

(c) to intensify research and development of other technologies where the potential is likely to be available over a longer time horizon.

The programme will cover all important new and renewable sources of energy such as solar, wind, bio-mass, chemical and geothermal energy and their application in agriculture, transportation and other sectors. In order to give an impetus to the development of renewable sources of energy, an Alternative Energies Coasmission is being set up.

Energy Forestry

15.95 In the emerging energy situation, as stated earlier, the role of non-commercial fuels-acquires a new significance. Rather than proceed on the assumption that substitution of non-commercial by commercial fuels is inescapable, a systematic effort has now to be made to sustain the supplies of such fuels and to improve the efficiency with which they are utilised. Fire wood, it is well-known, is the most im-por: .nt among the traditional fuels, accounting for almost two-thirds of the total energy contribution from non-commercial sources. It is becoming increasingly scarce and in many parts of the country, it has already ceased to be non-commercial in the strict sense. The ecological damage caused by extensive denudation of fore: for fuel and other requirements is too well known need any elaboration here. There is, no doui..!, the problem of pressure on land and the competition for land use for agriculture, industrial and housing activity. Recent experience, however, shows that even in the thickly populated areas of the country, sufficient land is available along roads, railway lines and canals and in the degraded forests and community lands for developing wood lots to provide fuel to the local communities. Energy forestry would have to be regarded as an Important component of our energy strategy, as the rural communities will continue to depend heavily on firewood for several decades to come. A large programme of fuel and farm forestry is therefore being taken up in the Sixth Plan, the traget being set at 13 lakh hectares of plantation. The details have been set out in the section on 'Forestry' in the chapter on Agriculture.


15.96 The technology for conversion of animal wastes into biogas is well-established and a fairly large number of bio-gas plants are alieady in operation. While the pioneering work in this field has already been carried out by the Khadi and Village Industries Commisison, a number of agencies are currently involved in a national coordinated programme with (he research effort aimed at raising the efficiency of gas generation and bringing down tlie capital cost of the biogas units. Some new designs have already become available; for instance, 'Janata' biogas plants, which do not require steel for construction and are built of bricks, are proving popular in Uttar Pradesh. Ferro-con cre?e is another material which holds out possibilities of displacing steel and reducing cost in the construction of biogas plants. Some innovative solutipns to the problem of poor gas generation under conditions of low ambient temperature also appear to be in sight. Further research efforts will be directed at cost reduction through improvement in design and use of materials, as also fermentation and the use of crop residues and water hyacinth in biogas production. Problems relating to the use of biogas for providing motive power and electricity will also be taken up.

15.97 The biogas programme, as is well known, not only provides much needed energy to the rural families reducing the pressure on fire wood supplies, but yields valuable organic manure, improves the environmental health in the rural areas and reduces the drudgery of women. Having regard to the large pontentia! which this programme offers of developing local sources of energy supply, an ambitious programme of installation of biogas plants is being launched. About one million family size plants and 100 community plants are proposed to be set up during the Sixth Plan. While financial provision will be made in the Plan for paying appropriate subsidies to those who install the biogas units, institutional funds will have to be harnessed for the prospective owners to meet the initial capital cost. It will also be necessary to strengthen the machinery for providing technical guidance, assistance in installation and post-commissioning services in the rural areas and to initiate a programme for dissemination of information relating to biogas and its applications.

Solar Energy

15.98 For a tropical country like India, solar energy could be an abundant source of renewable energy. The major problem in harnessing solar energy is the fact that it is diffuse and variable. While solar energy can be utilised successfully for low heat applications in which large variations in energy output are not critical, the technologies for concentrating solar energy for high heat applications or where energy storage is needed in order to provide a steady output, are still rather expensive. During the last few years, a broad-based coordinated solar energy research programme has emergd with an integrated approach of research, design and development. The R and D has concentrated on solar radiation and photo voltaic devices and systems for direct conversion of solar energy into electricity. In the solar thermal area, considerable progress has been made in the development of collectors aimed at improving efficiency and cost effectiveness for different specific applications. Work on selective coatings, concentrator collectors and tracking systems is in progress at various research centres. Among the devices which are in an advanced stage of development are solar water heaters for both residential and industrial applications, solar grain drying systems and space heating systems. Research programmes on solar pumps, cold storages and small sized thermal power plants are in progress. The main effort in the development of photo voltaic cells is to bring down the cost per peak watt of electricity to a reasonable level. This is sought to be achieved by developing low cost solar grade silicon material and by improving the efficiency of solar cells and panels.

15.99 A wide ranging programme encompassing both technology development and technology application is contemplated in the Sixth Plan. The development of both non-tracking and tracking collectors will continue. So also, materials development such as those relating to sealants, glazing, selective surfaces etc.. will receive attention. Among solar applications, heating and cooling systems, power plants and desalination will receive priority. A product development and analysis centre is to be set up to take up design, development and precommercial testing of solar thermal devices and systems, with a view to expanding their commercial utilisation. The future programme in the area of photo voltaic technology envisages a scaling up of the facilities for fabrication of solar panels, use of materials like cadmium sulphide and amorphous silicon in solar cells and development of modules for applications such as pumping of drinking water, minor irrigation, community lighting, educational radio and T.V. sets and communication equipment in remo^ areas.

15.100 As mentioned above, some applications of solar energy are ready for field application while certain others are in an advanced stage of development. Therefore, in the Sixth Plan. a national demonstration programme will be mounted on low and medium temperature heating systems, cooling and refrigeration system,;, and photo-voltaic pumps and other dences. These systems will be introduced for large scale utilisation as and when they become commercially viable.

Biomass Conversion Technologies

15.101 The R and D effort in the biomass area, covering all its facets is being intensified. It will cover identification of fast growing species and methods of increasing the efficiency of photo-synthesis. Two centres for research in biomass are to be established in the Plan period. Having regard to the possibility of producing a variety of liquid fuels and feed stocks by conversion of biodegradable materials, the R and D effort in this area is to be expanded in the coming years. Work will also be carried out on the study and cultivation of plants whose liquid sap contains hydro-carbons, which might eventually produce substitutes for petroleum based liquid fuels.

Wind Energy

15.102 Following a better understanding of the aerodynamics of rotating aerofoils and development of cheaper and stronger materials, there is a revival of interest the world over in the harnessing of wind energy. Some recent investigations have disclosed that in several parts of India, even though the average wind speeds over an year may be too low to permit running of wind operated devices, wind speeds are relatively high in those months of the year when supplementary irrigation is needed. This opens up considerable potential for utilisation of wind energy in our country. Some headway has been made in the development of different types of wind mills, a few of them based on locally available materials. The development of economic designs suitable specially for pumping nnnlications under different conditions, will be given attention in the coming years. Studies are also planned for a better assessment of the available wind data and the country's wind energy potential. Demonstration protects for wind energy applications under various field conditions will be launched in the Sixth Plan. Two centres for conducting R and D in problems relating to wind energy utilisation are to be set up in the Sixth Plan.

Other New Technologies

15.103 While for an agricultural country like India located in the tropical belt, solar energy and biomass would hold out maximum potential as energy sources. other possible sources would also have to be tapped. The potential of geo-thermal energy in India, however, appears to be very limited and onlv two locations .vith some potential have been established. While exnio-ratorv work is being carried out in Puga valley in Ladakh, the feasibility of tapping geo-thermal energy in the Manikaran area of Himachal Pradesb for run-nincr a cold storage is bein? examined. Plans are on hand to assess the possibility of harnessing tidal energy at one or two locations on the west coast of India. Though tTie basic technology for hvdro power generation is well established, micro hvijel stations which take advantage of the head available in mountain streams, canal drops etc., have yet to become popular; their high construction and equipment cost has been a major inhibiting factor. Attention will be paid to methods of simplifying the designs and using local materials, so that water power could be tapped for providing motive power as well as for small scale electricity generation.

15.104 It is also necessary to make serious efforts to develop new technologies for energy storage. Projects for the development of battery powered vehicles will be expanded so that vehicles suited to our conditions and requirements can be produced. This has the potential of reducing the demand for petroleum products in the transportation sector. Research projects relating to the production, storage and use of hydrogen as well as the development of fuel cells will also be intensified.

Integrated Rural Energy Systems

15.105 The possibility of decentralised energy production and distribution deserves serious consideration particulary for meeting the energy needs of


15.106 For the schemes of fuel and farm forestry, Rs. 50 crores have been provided in the Agriculture Sector of the Central Plan. Under the Energy sector, Rs. 50 crores have been earmarked for the biogas programme for payment of subsidies and some supporting facilities; the bulk of the investment will be in the private sector, the funds being drawn mostly from institutional sources. For the S and T programme relating to new energy 'sources, the Plan makes a provision of Rs. 50 crores.

Annexure15.1 Benefits from Generation Schemes during Sixth Five Year Plan: 1980—85

Sl.No. Region /Scheme Benefits (MW)
(1) (2)
1 Beas H.E. Scheme extension Unit I (Debar) (Punjab, Haryana, Rajasthan) 330
2 Beas H.E. Scheme Extension Unit II (Pong) (Punjab, Haryana, Rajasthan) 120
3 Panipat Thermal Station Extn. I (Haryana) 220
4 Faridabad Thermal Station Extension Unit III (Haryana) 60
5 Western Yamuna Canal H.E. Schane (Haryana) 48
6 Shanon H.E. Scheme Extn. (Punjab) 50
7 Ropar Thermal Station (Punjab) 210
8 New H.E. Schemes (Punjab) 224
9 Bassi H.E. Scheme Augmentation (Himachal Pradesh) 15
10 Binwa H.E. Scheme (Himachal Pradesh) 6
11 Andhra H.E. Scheme (Himachal Pradesh) 15
12 Rontong H.E. Scheme (Himachal Pradesh) 1
13 Kota Thermal Station (Rajasthan) 220
14 Mahi Bajajsagar H.E. Scheme (Rajasthan) 140
15 Obra Thermal Station Extens on II and III (Uttar Pradesh) 400
16 Paricha Thermal Station (Uttar Pradesh) 230
17 Garhwal-Rishikesh H.E. Scheme (Uttar Pradesh) 72
I8 Khodri H.E. Scheme (Uttar Pradesh) 120
19 ManeriBhali H.E. Scheme (Uttar Pradesh) 90
20 Tanda Thermal Station (Uttar Pradesh) 440
21 .Anpara Thermal Station (Uttar Pradesh) 630
22 Badarpur Thermal Station Unit V (Central) 210
23 BairaSiul H.E. Scheme (Central) 60
24 Singrauli Super Thermal Station Phase I (Central) 630
25 Singrauli Super Thermal Station Phase II (Central) 420
26 Rajasthan Atomic Power Project Unit II (Central) 220
27 Wanakbori Thermal Station (Gujarat) 630
28 Ukai Left Bank Canal H.E. Power House (Gujarat) 5
29 Ukai Thermal Station Extension Unit V (Gujarat) . 210
30 Kadana H.E. Scheme (Gujarat) 120
31 Wanakbori Thermal Station Extension (Gujarat) 210
32 Korba Eist TIiarnnl Station Extension (Madhya Pradesh) 120
33 Korba Wsst Tilsrmil Station (Madhya Pradesh) 420
34 Korba West Thsnml Station Extension (Madhya Pradssh) 420
35 Satpura Thermal Station Extension II (Madhya Pradesh) 420
36 Peach H.E. Scheme (Madhya Pradesh and Maharashtra) 160
37 Koradi Thermal Station Stage III (Mah irashtra) 420
33 B'r-mw.il Thsrnnl Station Extension (Maharashtra) 210
39 NisikThhermal Station Extension (Malurashtra) 210
40 ParliThernal Station Extension (Malurashtra) 210
41 Chindrapur Thermal Station (Maharashtra) 420
42 Trombay Thermal Station (Maharashtra) 500
43 Gas Turbine Plant (Maharashtra) 240
44 Koyna Dam H.E. Power House (Maharashtra) 20
45 Tillari H.E. Scheme (Maharashtra) 60
46 Paithon H.E. Schsma (Maharashtra) 13
47 Bhira Tail Race H.E. Scheme (Maharashtra) 80
48 Chandapur Tehermal Station Extions (Maharashtra) 210
49 Korba Super Thsrnnl Station (Central) 630
50 Vijayawada Thernnl Station (Andhra Pradesh) 210
51 Nagarjunasagar Pumped Storage Schems (Andhra Pradesh) 300
52 Nagrjunasagar Right Canal H.E. Scheme (Andhra Pradesh) 60
53 Donkarayi Canal H.E. Scheme (Andhra Pradesh) 25
54 Balimila Dam H.E. Power House (Andhra Pradesh) 60
55 Srisailam H.E. Project (Andhra Pradesh) . 440
56 Kalinadi H.E. Scheme (Kamataka) 775
57 Raichur Thermal Station (Karnataka) 420
58 Idamalayar H.E. Scheme (Kerala). 75
59 KakkadH.E. Scheme (Kerala) 50
60 Tuticorin Thermal Station (Tamilnadu) 210
61 Sarvalar H.E. Scheme (Tamilnadu) 20
62 Kadamparai Pumped Storage Schems (Tamilnadu) 400
63 Ramagundam Super Thenml Station (Central) 630
64 Neyveli Thermal Station (Central) 420
65 Madras Atomic Power Project (Central) 470
66 SubernarekhaH.E. Scheme (Bihar) 65
67 Patratu Thermal Station Extn. IV (Bihar) 220
68 Barauni Thenml Station Extension Units VI and VII (Bihar) 220
69 Muzzaffarpur Thermal Station (Bihar) 220
70 Talcher Thermal Station Extension (Orissa) 220
71 Rengali H.E. Scheme (Orissa) . 100
72 Upper KolabH.E. Schema (Orissa) 240
73 Santaldih Thermal Station Unit IV (West Bengal) 120
74 JaldhakaH.E. Scheme Stage II (.West Bengal) 8
75 Bandel Thermal Station Extension (West Beiigel) 210
76 Kolaghat Thermal Station (West Bengal) 630
77 RammanH.E. Scheme (West Bengal) 50
78 Dargipor Projects Ltd. Tri3r.ii.il Station Extension (West Bengal) 110
79 C.E.S.C. Ther.ml Station (West Bengal) 240
80 Dargapur Thermal Station Unit IV (D.V.C.) 210
81 Bokaro 'B' Thermal Station (D.V.C.) 210
82 Panchet Hill H.E. Scheme (D.V.C.) 40
83 Parakka Super Thermal Station (Ce.itral) 210
84 Bongaigaon Thermal Station (Assam) 120
85 Lakwa Gas Turbine Project (Assam) 45
86 Waste Heat Recovery Plant at Namr up (Assam) 22
87 Lower Borpani H.E. Scheme (Assam) 50
88 Bongaigaon Thermal Station Extension (Assam) 120
89 Chandrapura Thermal Station Extn. (Assam) 30
90 Mobile Gas Turbine Units (Assam) 21
91 Dikhu H.E. Scheme (Nagaland) 1
92 Gumti H.E. Scheme Unit III (Tripura) 5
93 Loktak H.E. Scheme (Central) 105
94 Kopili H.E. Scheme (North Eastern Council) 150
Total (Utilities) 19666

Annexure 15.2 Cumulative Installed Capacity by the End of Sixth Five Year Pian 1980-85 As on 31.3.1985

Sl. States No.

Installed Capacity (MW)

(0) (1) (2)
I- Utilities  
1. Andhra Pradesh 3025.43
2. Assam 569.78
3. Bihar 1615.27
4. Gujarat 3396.02
5. Haryana 1541.21
6. Himachal Pradesh 270.83
7. Jammu and Kashmir 206.18
8. Karnataka 2529.80
9. Kerala 1136.50
10. Madhya Pradesh 3033.02
11. Maharashtra 6196.30
12. Manipur 10.41
13. Meghalaya 131.11
14. Nagaland 4.68
15. Orissa 1483.12
16. Punjab 2216.84
17. Rajasthan 1315.60
18. Sikkim 15.04
19. Tamil Nadu 2959.00
20. Tripura 19.06
21. Uttar Pradesh 5311.76
22. West Bengal 2978.54
Sub Total : 39965.50
23. North Eastewrn Council 150.00
24. Delhi 275.80
25. Other Union Territories 22.91
26. Central Plan Including DVC 7742.50
Total (Utilities) : 48156.71
Say 48157
II. Non-Utilities 3035
All India 51192


Annesure 15.3 Sixth Plan Outlay-Power Sector

Sl.No States/ U.T.'s/Centre Outlays (Rs. lakhs)
(0) (1) (2)
I States
1 Andhra Pradesh 78970
2 Assam 37030
3 Bihar 80000
4 Gujarat 94150
5 Haryana 54500
6 Hinuchal Pradesh 13973
7 Janimu and Kashmir 17000
8 Karnataka 60140
9 Kerala 31273
10 Madhya Pradesh 150000
11 Maharashtra 215700
12 Manipur 1865
13 Meghalaya 4599
14 Nagaland 1525
15 Orissa 4l0'3
16 Punjab 73294
17 Rajasthan 67500
18 Sikkim 1200
19 Tamil Nadu 1022S3
20 Tripura 2211
21 Uttar Pradesh 212590*
22 West Bengal 85655
  Sub-Total—States 1429356
II Union Territories
1 A and NIslands 1200
2 Arunachal Pradesh 2418
3 Chandigarh 1150
4 Dadra and Nagar Haveli 150
5 Delhi 15294
6 Goa, Danmn and Diu 1800
7 Lakshadweep 150
8 Mizoram 1800
9 Pondicherry 726
Sub-Total—(U.Ts.) 24688
III Central Plan
1 Deptt. of Power (including Centrally Sponsored Programmes) 360000
2 Deptt. of Atomic Energy 45000
3 D.V.C. 30000
4 Neyveli 37500

Sub-Total—Central Plan (1—4) (including Cintrally Sponsored Programme) 472500
  Total (All India) 1926544.0

*0utlays are tentative. £Exclusive of the outlays included in Rs. 285 crores for Special Projects Agriculture (SPA) Programme (REC's share), Rural Cooperatives, System Improvement Schemes and Harijan Bastis.

Annexure 15.4 Sixth Plan Outlay : Coal and Lignite

Sl.No. Schemes Plan Outlay 1980—85 (Rs. crores)
(0) (1) (2)
A. Coal India Ltd.  
1 Continuing Schemes and existing mines 456.32
2 Sanctioned reconstruction/new mines 859.20
3 Mines yet to bs sanctioned 550.00
4 New Mines to be formulated/sanctioned 147.18
5 Total Investment on Mines 2012.70
6 Waoheries 78.04
7 Exploration and CMPDI 69.33
8 Coal utilisation 47.88
9 Others (Development of new methods, mining education and training. Damodar river 145.00
Total—Coal India Ltd. 2352.95
B. Singarsni Colliery Co. Ltd.  
10 Investment on mines 212.82
11 Exploration and Coal utilisation Total—Singareni ColleriesCo. Ltd. 7.02 219.84
Total Coal (A+B) 2572.79
C. Lignite  
12 Neyveli Lignite Corporation 13 Science and Technology 272.21 25.00

Annexure 15.5 Target of Domestic Crude Production
(In million tonnes)

  1980-81 1981-82 1982-83 1983-84 1984-85
Western Region Ankleshwar 3.0 1.8 1.7 1.6 1.4
North Gujarat 1.4 1.1 1.4 1.4 1.4
  3.4 3.2 3.1 3.0 2.8
EastmRegton 0 N G C 1.7 2.1 2.6 2.8 3.0
0 I L 2.8 3.2 3.0 2.8 2.6
  4.5 5.3 5.6 5.6 5.6
ONLAND 7.9 8.5 8.7 8.6 8.4
OFFSHORE 5.2 8.4 11.8 12.7 13.2
TOTAL 13.1 16.9 20.5 21.3 21.6

Annexure 15.6 Sixth Plan Ontley : Petroleum Sector

  (Rs. crores)
Organisation Programmes/Projects Outlays
(1) (2)
I. Oil and Natural Gas Commission and Oil India Ltd. Operations 2853.58
II. Oil and Natural Gas Commission—R and D 20.00
(i) Operations 1408.89
(ii) R and D . 17.53
III. Indain Oil Corporation (IOC):  
(a) refineries and Pipelines Division  
A. Continuing Schemes  
1 Mathura Refinery Project 63.19
2 Gujarat Refinery Expansion Project 0.40
3 Gujarat Refinery Secondary Processing Project 36.95
4 Salaya-Viramgam-Koyali-Mathura Pipeline (SVKM) 46.00
5 U.H.F. Telecommunication System 0. 27
6 Mathura-D.slhi-Ambala-Jullundur Pipeline 49.80
7 Additional Coker at Barauni Refinery 38.38
8 Gauhati-Siliguri Pipeline Expansion 2.63
9 Effluent disposal line and Coaling Towers at Gauhati Refinery 3.35
10 Office AccommoJation at New Delhi 2.56
11 Haldia Refinery Project 0.21
12 Lube-expansion atHaldia Refinery 2.90
13 Additional Radial welIatGujarat Refinery 1.70
14 Naplitha-Splitter facility at Gauhati Refinery . 3.15
15 Additional 8 MW T-G set at Gauhati Refinery 3.32
16 Additional facilities 27.00
Sub-Total (A) 281.81
B. New Schemes  
1 Haldia Refinery Expansion with lube-unit and F.C.C. 80.10
2 L.P.G. Bottling and bulk-loading facilities at GiiJ'arat Refinery 4.67
3 Additional 12.5 MW T-G set with boiler at Barauni Refinery 15.00
4 Micro-crystal line wax production facilities at Haldia Refinery 1.00
5 Replacement of 3 furnacesin distillation units of Gujarat Refinery 7.25
6 Replacement of 3 furnacssin distillation unitsof Barauni Refinery 7.25
7 Mandatory Crude Tanks  
(i) Phase-1 13.83
(ii) Phase-11 12.00
8 Rajkot Pump Station (SVK expansion) 4.55
9 Additional tanks at Viramgam 4.90
10 Barauni-Kanpur Pipeline Modernization 1.50
11 Spare SBM at Salaya 25.03
Sub-Total (B) 177.05
Total (A+B)—R and P Division 458.86
Marketing Division  
A. Continuing Schemes :  
1 Fuel Hydrant facilities at Bombay : Phase I 5.79
2 L.P.G. Marketing facilities : Phase I 32.42
3 Installations at D3lhi,Ambala and Jullundur 15.86
4 Office accommodation at Madras, Bombay and Calcutta 8.39
5 Residential accommodation 3.74
6 Other Minor schemes such as provision of rotuil-outlets, consumer depots, consumer pumps and kerosene depots in hilly and far-flung areas, development of infrastructures, residential accomiTiodation (other than at Bombay) and office accommodation (other than at Bombay, Madras and Calcutta) etc. 80.00
Sub-Total (A) 146.20
B. New Schemes  
1 L.P.G. Marketing facilities—Phase 11 8- 50
2 Facilities for marketing oil's LPG 22-90
3 Fuel hydrant at Bombay—Phase II and III . 3-15
4 Pipeline co nneeting Bijwasan and AFS Delhi. 1.58
5 Marketing facilities for L.P.G. from additional B.H. gas 32-25
6 Mandatory tankage at (i) Iiut.illationi 13-02
(ii) Depots 8-16
sub total (B) 89-56
total (A+B): Marketing Division 235-76
(c) R and D Centre  
A. Continuing Schemes
1 R and D Centra Project 1-04
B. New Schemes
1 Additional facilities 5-85
total (A+B)—R and D Centre 6-89
(d) Indian Oil Blending Limited (IOBL)
1 Expansion of blending facilities 4.20
2 Additional Facilities 1-23
total (d)—IOBL 5-43
grand To tal (a + i+c+ d): IOC 706-94
IV. Bharat Petroleum Corporation Ltd. {BPCL)
A. Continuing Schemes
1 Installaion of facilities for processing neat BH crude at a level of 4- 6 mtpa. 0-86
2 Installation of facilities batween HPCL and BPCL for Intar-Refinery Optimisation of yields and usage of capacity (BPCL's share only) 0-08
3 Debottlenecking of Distiller and Installation of Additional Secondary Processing facilities 35-44
4 Marketing of Incremantal LPG—Phase I 8-57
5 R and D Project for Lubricants, Greases and Specialities 0-40
6 Construction of Staff Quarters (Marketing Division) at Bombay 0-59
7 Construction of Staff Quarters at Upcountry locations and Bombay . 0-83
8 Installation of Sulphur Recovery Plant at BPCL 3-19
9 Other Renewals, Replacements and Minor Additions . 47-30
sub-total (A) 97-26
B. New Schemes
1 Marketing of Incremental LPG—Phase II 22-20
2 Construction of Staff Quarters 3-00
3 Crude Tankage—Three Tanks of 75000 tonnas capacity each 7-10
4 Product Tankage for a total storage capacity of 662000 tonnes 17-00
5 New computer system and auxiliaries 1-30
Sub-ToTAL (B) 50-60
total (A+B):BPCL 147.86
V. Hindustan Petroleum Corporation Ltd. (HPCL)
A. Continuing Schemes
1 Marketing of LPG from BH Gas—Phase I 12 -25
2 Lube Refinery Expansion 12-07
3 Computer 0-85
4 Lube Oil Pipeline 1-80
5 ATF Pipeline . 1-04
6 Visakh Refinery Expansion 65-85
7 Crude Oil Discharge Pipeline 6-85
8 Residential Units 0-73
9 Crude Desalting facilities, Bombay 0-85
10 Waste Heat Boiler, Visakh 0-65
11 Additional Tank-Trucks 0-54
12 Bulk Asphalt 0-99
13 Crude Furnace, Bombay 2-20
14 Hexane Maximisation 1-80
15 Replacements and Minor Additions 7-00
Sub-ToTAL(A) 115-47
B. New Schemes
1 Sulphur Recovery Project 2-70
2 Bombay-Pune Product Pipeline 21-17
3 Marketing of LPG from BH Gas—Phase II 13-61
4 Tank Trucks 0-60
5 R and D facilities 0-50
6 Residential Units 2-00
7 Aviation facilities 1-00
8 Product Tankage and Associated facilities 7-00
9 Mandatory Crude Tankage, Bombay 3-00
10 Second Mandatory Crude Tankage—Visakh 2-50
11 Tap-off Terminal at Vashi 3-25
12 Black Oil Pipeline from Refinery to Vashi and Tenninal at Vashi 1-00
13 Manufacture of Brght Stock/Cylinder Oils . 5-10
14 Replacement of Boiler at Visakh 3-00
15 Lube Refinery Expansion 10-00
16 Replacement/ Minor Additions 16-90
sub-total (B) . 93-33
totai.(a+b):hpcl 208-80
VI. MflAw Refineries Ltd. (MRL)
A. 1 Continuing Schemes
1 Paraffin Wax Project 13-48
2 Additional Cttide Tanks (105) 0-96
3 Expansion of the Refinery from 2-8 to 5-6 mtpa 54-78
4 LPG Sphere 0-60
sub-total (A) 69-82
B. New Schemes
1 Additional Mandatory Crude Tanks (106 and 107). 6-00
2 Lube Plant (50000 tonnes HVI) 10-00
sub-total(b) 16 00
total (A+B): MRL 85-82
VII. Cochin Refineries Ltd. (CRL)
A. Continuing Schemes
1 RC-1 Compressor 0-20
2 Stripper 0-24
3 Secondary Processing facilities 48-70
4 Replacements and Additions 2-50
sub-total (A) 51-64
1 Strategic Crude Tanks 5-60
2 Expansion of Refining Capacity to 4.5 mtpa 4-90
sub-total (B) 10-50
total (A+B): CRL 62-14
VIII. Bongaigmn Refinery and Petrochemicals Ltd. (BRPL)
A. Continuing Schemes
1 Crude Distillation Unit (CDU) 0-29
2 Kerosene Treating Unit (KTU) 0-37
3 Delayed Cokcr Unit (DCU) 2-39
4 Coke Calcination Unit (CCU) 1-64
5 Captiva Power Plant (CPP) 7-88
6 Offsitas—Phasw I 2-02
total : BRPL 14-59
IX. Lulrizol India Ltd. (LIL)
A. Continuing Schemes
1 Continuing Schemes 1-25
2 R and D Schemes 1-55
sub-total (A) 2-80
B. H'M Schfme3
1 Su I phonic Acid Manufacture 1-t0
2 Calcium Phenale Unit. 0-30
3 Cold flow and Viscosity Index Improver 3-32
sub-total (B) 4-72
total (A+B); LIL 7- 52~
I.. Enginews India Ltd, (E1L)
A. Continuing Schemes
1 ElL'S own office Building 3-56
B. R and D Schemes 3-64
total (A+B): E1L 7-20
XI. Indian Institute of Petroleum (IIP)
A. Continuing Schemes 2-50
B. New Schemes
1 Modernisation of Equipment 0-50
2 Establishment of Pilot Plant Centre for Refinery Processes and Catalyst Development (to be set up at Baroda) 4-00
sub-total (B) 4-50
totai(a+b):iip 7-00
I.Department of Petroleum
1 Fuel Hy'ir.mt System at Palam 17-85
2 Lube Blending facilities at Shakurbasti 0-70
3 New Refineries 150-00
4 Manufacturing facilities for Aviation Gas 10-00
total : Department of Petroleum 178-55
GRAND total: (I to XII): Petroleum Sector 4300-00
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