Dialogue  July-September  2007, Volume 9  No. 1

Power and Energy Scenario of the Northeast

Pallabi Borah*

The power-starved North-Eastern (N-E) Region, comprising Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura, is blessed with a huge hydro potential. The region also has abundant resource of coal, oil and gas for thermal power generation. According to the estimates of the North Eastern Electric Power Corporation (NEEPCO), the north-eastern region has the potential of about 58971 MW hydro power i.e. almost 40% of the country’s total hydro potential; but out of this only less than 2% (1095MW) has so far been harnessed. As per the report status of hydro electric power potential listed by Central Electricity Authority (CEA) out of the total capacity of 58971MW, only 4029 MW has been tapped, which amounts to less than 7%. The region has a reserve of 151.68 billion cubic feet natural gas, which is capable of generating 7500 MW for 10 years. The region is also blessed with 864.78 million tones of coal against 186 billion tones of reserves in the country. With this reserve in the NE Region, approximately 240 MW/day can be generated for a period of 100 years.

But, in spite of such huge potential, the region ranks lowest in the country in terms of power generation and per capita energy consumption mainly due to lack of proper planning, inhospitable climatic conditions, remote location and inaccessibility. However, with continual improvement of infrastructure and communication facilities, the Northeast stands to become the power house of India by utilizing its surplus power potential, especially in hydel sector. The region offers a large potential in renewable energy, which is also yet to be exploited. There is also an imbalance between hydel and thermal power, both in terms of generation and availability. The transmission and distribution sector is the weakest link of the electricity industry in the NE region. Huge transmission and distribution losses, estimated to be at over 40 per cent, lower tariffs as compared to costs of generation and transmission and mounting losses of the state electricity boards, are crippling the electricity sector of the region.

Among the NE states Arunachal Pradesh is the richest in hydroelectric power potential. In fact with an estimate of 27000 MW the state ranks first in the country in terms of hydroelectric power potential. The state also has the highest number of high head mini and micro hydel projects in India. The state has 37 power plants ranging from 5KW to 4500 KW with a total installed capacity of 23.8 MW and firm power of 16.5 MW. In the state, 94 diesel generating stations, ranging from 10 KW to 500 KW capacities, are functioning with a total capacity of 18.5 MW. Another 21 projects with total installed capacity of 76.25 MW are in different stages of implementation. Ranganadi Hydel Power project with a total installed capacity of 405 MW, Kameng Hydro Electric Power Project (600MW), Subansiri Hydro Electric Power Project (4500 MW), Siang Hydro Electric Power Project (2000MW) and Damwe Hydro Electric Power Project (600MW), are the important projects in the state under NEEPCO, Brahmaputra Board and Central Water Commission. As per Power Ministry data for 2004, the share of Arunachal Pradesh in Central sector stations was 117 MW and installed capacity in the State sector was 45.43 MW. The total installed capacity was 162.43 MW. The percentage of villages electrified was 60.46% as on March 31, 2005, while the percentage of rural household having electricity was 44.53%, as on March 31, 2004. Per capita consumption of electricity is 68.61 KWh in 2000-01.

 Assam also possesses immense potential for development of the power sector based on hydel power. However, despite being a storehouse of power, ranging from hydel to natural gas including oil and coal resources, the progress of this sector in Assam has not taken place on a scale commensurate with the possibilities. As a result, there exists a big gap between availability and demand for power in the state. Assam accounted for only a small fraction i.e. 0.16 per cent of the total generation of electricity in the country during 2000-2001. On the contrary, consumption of power in the state has been increasing in the recent years. The average per capita consumption of electricity in the state was 120 Kwh in 2000-2001 and 140 Kwh in 2001-2002 as reported by the Assam State Electricity Board (ASEB). The installed capacity of power has remained the same at 574.4 MW since 1997-98 till date. The power generation in the state has gradually declined from the year 1996-97 and this downward trend continued till 2002-2003. During the year 2001-2002, the generation of power has decreased by 10.1 per cent as compared to the previous year and it further declined by 11.2 per cent during the year 2002-2003. In order to meet the domestic demand, the state has been purchasing power from other sources. The total number of villages electrified in Assam was 19039 as on March 2003, out of the 24685 inhabited villages of the State as per 1991 Census. The ASEB has six installed projects with the total installed capacity of 574 MW against the peak demand of 621 MW. The power supply position in the state is expected to improve considerably in the coming years with the materialization of projects under the state sector like Borgolai Thermal Power project (120 MW), Karbi Langpi Project (100 MW) and Amguri Combined Cycle Gas Based project (90 MW). In the Central sector, NEEPCO has installed and commissioned Kopili HEP (250 MW) and Kathalguri Gas Based Power Project (291 MW). NEEPCO is currently taking up construction of Kopili 2nd stage (25 MW) and it plans to take up the Lower Kopili (150 MW).

 The state of Manipur is endowed with plenty of hydropower potential (about 2000 MW) in its hilly streams and rivers. Still, Manipur is a power deficit state and majority of the power requirement is imported from external sources. The power supply in the state depends entirely on the share of power allocated from the central sector plants. The present requirement of the State is 120 MW at peak hours, whereas the availability of power from the central sector plants is 70 MW and the state’s own generation is only 13 MW. Manipur, at present has two small hydro projects and twenty-two diesel projects with a total installed capacity of about 10 MW and the total power availability, including share of power from central sector, is about 48 MW only. Against this, the peak demand is estimated to be approximately 129 MW; there is shortage of more than 50 per cent of the total requirement. So to meet the power requirement during critical period, the state has to purchase power from sources like Eastern Regional Electricity Authority and Meghalaya State Electricity Board. Under the central sector, there is one hydel project – Loktak HEP with installed capacity of 105 MW. The Loktak Down Stream (90 MW) and some more projects are in the pipe line under the state sector like Leimakhong H.E. Power Project (1MW) and heavy fuel based power projects (36MW).

 Meghalaya, with its vast coal reserve, is extremely rich in thermal power potential too. This coal has high calorific value with low ash content but high sulphur content, which is suitable for setting up thermal power projects. At present, Meghalaya has a total of five installed projects (hydel) with total installed capacity of 185.20 MW. Against the total installed capacity, the peak requirement is 94 MW Thus, at present, there is no shortage of power in Meghalaya. But, in view of the proposed industrialization of the state and also for the industrial development of the northeastern region, Govt. of Meghalaya and North Eastern Council have taken several steps to develop thermal as well as hydro power generating stations in the state. Accordingly, to meet the requirement of the state as well as for selling to other states, Laiska Hydro Electric Power project of 54 MW has been proposed under the state plan.

Despite having a rich potential in hydro, Mizoram is also not having its own power generation worth mentioning. At present, there are 22 isolated diesel power stations scattered at various places and 9 mini/micro hydel stations in operation with an installed capacity of 26.14MW (diesel power station) and 8.25MW (mini/micro hydel station) respectively. As per 16th Electric Power Survey of India under CEA, the restricted peak load demand of the State during the year 2002-2003 is 102 MW. Against this, an effective capacity of about 16MW from diesel power stations and 6MW from hydel stations is available from local generation. The requirement of power is mostly made up by importing energy from central sector generating stations and the state’s own share of 8MW from Rokhia-II in Tripura through the North Eastern Grid looked after by the Power Grid. In all, total availability of imported power rarely exceeds 45 MW during peak hour. Thus, there is a big gap between demand and availability of power. The daily peek short fall at normal condition accounts for about 34% to 40%. While the installed generating capacity appears adequate, in reality many of the units in the state sector are closed and those, which are running, are at very low plant load factors. The state is bestowed with large areas of bamboo plantation. Mizoram produces annually 3.2 million tonnes of bamboo, which had never been tapped to generate electricity. But a bamboo-fuelled eco-friendly power station is to come up very soon in Mizoram to help meet the energy needs of the north-eastern region. The power station will be set up in Sairang village at an estimated cost of Rs.28.50 million. An estimated 9,000 sq km area is under bamboo cultivation in Mizoram.  India, the world’s largest producer of bamboo after China, grows about 80 million tonnes each year, more than half of it in the northeast.

In Nagaland, out of requirement of 42 MW of power, Micro hydel stations and diesel stations generate 4.26 MW. Therefore the whole requirement of power is purchased from central sector projects like NHPC and NEEPCO. The allocation from NHPC and NEEPCO for Nagaland is only 25 MW and therefore the department has arranged with Meghalaya state electricity board and Assam State Electricity Board to meet the shortfall. Department of power, Nagaland, responsible for generation, transmission and distribution of power in the state, has taken up a 24 MW heavy fuel based Thermal Power station at Dimapur besides preparing for a 120MW multi purpose hydel power project at Dikhu and a mega HEP (around 300MW) at Tizu-Zingki.

 Sikkim, with its picturesque landscape and amazing terrain and some of the swiftest rivulet system, has a huge hydro power potential. With the liberalized power policy Sikkim is poised to gain in a big way. With the opening of this sector for private developers, Sikkim can look forward for developing and exploiting its huge hydro power potential, which has been assessed to 8000 MW peak with a firm base of 3000 MW. At present the total installed capacity under Energy and Power Department is 35.70 MW generated from 12 micro, mini and small power houses. Shyam Saran, special representative of Prime Minister Manmohan Singh stated on July 25 this year at Gangtok that Sikkim could play a key role in cross-border energy trading with bordering countries like Nepal, Bhutan and Bangladesh by harnessing its hydel power prospective to the full. In his speech on the ‘Role of Border States in India’s Foreign Relations and Regional Economic Cooperation’, Saran said, “By tapping its huge hydro-electricity potential, Sikkim can become a major supplier of power to the neighbouring countries.” Saran begrudged the reality that the development in this segment in the state had not been as quick as anticipated. “Being a border state, Sikkim needed better roads, rail and air connectivity to play a key role in developing closer ties with our neighbours,” he added.

 The power and energy scenario in Tripura is not satisfactory. At present, the state has a total of five installed projects under the state sector (two hydel, two thermal and a diesel) with total installed capacity of 85.35 MW. Under the Central Sector, NEEPCO has commissioned the 84 MW Agartala Gas Turbine Project. There are some more projects under the state sector in the pipeline like Baramura Gas Thermal Extension Project (24 MW), Rokhia Gas Thermal Project, Phase-1 (21 MW), Rokhia Gas Thermal Project, Phase-2(21 MW) and micro hydel project with a capacity of 1MW. The proposed Loktak Down Stream Hydro Electric Project in Manipur and Turial H.E. project in Mizoram will be a great help for Tripura.

 The North Eastern Council (NEC), established by the Government of India in 1972 as a regional cooperation for removal of the basic constraints and development of the region, has laid emphasis on the development of power and energy in the region. Over the last three decades, NEC has sanctioned projects having total generation capacity of 673.5 MW. The installed capacity of the region increased from 211.99 MW in 1974 to 2202.19 MW in 2002 in which NEC’s share is 33.84% of the total capacity addition. The Council has also intervened in streamlining of the power transmission system and connection of the region to the national grid. However, most of the power projects took exceptionally long period of time in implementation and the consequent high cost overrun has delayed the expected benefit.

Union Power Secretary Anil Razdan had said recently that the northeastern states should beef up their hydroelectric power potential and use the untapped gas and oil reservoirs in the region. “We have set a target of adding 5,600 MW of power in the Northeast. If bottlenecks can be removed satisfactorily, over 30,000 MW of power can be added to the region through hydro and other resources,” he said addressing the ‘North East Powermart 2007’, organized by the Confederation of Indian Industries (CII) in Kolkata in July 2007. He said that the power sector in the northeastern States is likely to witness a capacity addition of at least 5,600 MW in the XI Plan.

 Looking after the Northeast for the Look East Policy:

 Development of the Northeast is receiving priority attention of the Government of India as a vital link in the development of economic relations with neighboring countries, especially in the context of the ‘Look East Policy’. The Union Minister for Development of the North Eastern Region Mr Mani Shankar Aiyar has rightly commented that South-East Asia begins in Northeast India. But, as the Minister of State for Commerce, Mr Jairam Ramesh says, India’s Look East Policy has to look Northeast first. Today, one-third of India’s trade volume is with South-East Asia,  which has emerged the largest trading partner with India but it has had no impact on the country’s Northeast. But India’s Look East Policy is meaningless if it does not have any impact on this border region. 

 The possibility of energy trading among the countries of the East and South East Asia has opened new vistas of cooperation. Cross border energy trade could lead to: i) effective utilization of natural resources, ii) increase in reliability of power supply, iii) economy in operation and mutual support during contingencies, iv) bring about large scale transformation in the sectors contributing to economic growth, v) act as the single most effective confidence building measure (CBM) through the participation of multiple stakeholders and vi) substantially promote market integration in energy related goods and services.

 The river systems of Northeast region have linkages with its neighboring countries – Tibet (China), Bhutan, Bangladesh and Myanmar – as trans-boundary or in some stretches as border rivers. The Brahmaputra originates in Tibet as the Tsangpo and flows into India as the Siang (the Dihang) and empties into Bay of Bengal after traversing through Bangladesh. Some of the tributaries of the Brahmaputra also have catchment areas in Tibet/China. There are possibilities of utilizing the U Bend (called the “Big Bend”) in the Tsangpo River (Brahmaputra) between Tibet (China) and Arunachal Pradesh in India for mega scale hydropower development. A drop of about 3,000 m is available as Tsanpgo flows at an altitude of 3,600 m and descends to Gelling in Arunchal Pradesh which could be utilized for generation of a very large amount of power. The river systems – Pagladia, Manas, Sankosh and Rydak and Torsa of Bhutan – join the Brahmaputra from the north in Indian territory. There is an excellent ongoing cooperation between the two countries on the water resource development for hydropower generation. The Kolodyne River in Mizoram/Manipur flows into Myanmar. Under an MoU signed between India and Myanmar, NHPC completed the investigations on the 800 MW Thamanthi Hydro Project in Myanmar. Beginning of this cooperation would auger well for development of the potential on the border and trans-boundary rivers between the two countries. On the other hand, the Tipaimukh multipurpose project on the Barak, proposed at tri-junction of Manipur, Mizoram and Assam, seems to have raised ill-founded apprehension in Bangladesh; that the project would dry up the Barak River and cause summer flooding in the Sylhet bowl. But this project, with specific flood cushion, would provide substantial flood relief to flood-affected areas in the Cachar Valley in Assam and Sylhet Region in Bangladesh. Development of NER’s hydro power would also provide an opportunity to Bangladesh to avail hydro electricity to support its grid and facilitate linking power grids of Bangladesh and India.

In a significant development, the proposed 900 km gas pipeline from Myanmar via Bangladesh, has hit a road block, with Myanmar selling off the huge Shwe gasfield to a Chinese consortium. Earlier, India, Bangladesh and Myanmar had agreed to construct the pipeline from Myanmarese gas-field to Kolkata, passing through the Indian states of Mizoram and Tripura, and Bangladesh. As part of the deal, Bangladesh was to get access to the gas as well as $125 million in transit fees from India. In exchange for agreeing to the project, Bangladesh was also pushing for a trade and transport corridor linking Nepal and Bangladesh through Indian territory, as well as access to hydroelectric power generated in Bhutan and Bangladesh using India’s power grid. However, the resurgence of violence in India’s Northeast, sporadic attacks on pipelines, and India’s poor relations with gas-rich Bangladesh and China-friendly Myanmar have prevented it from fully exploiting its proximity to a region rich in energy resources.

It is noteworthy that cross border power trade on a bilateral basis have already taken place widely between India and Bhutan and to a certain extent between India and Nepal.

 Economic growth in East and South East Asia has increased energy needs, as the regions’ countries increasingly depend on hydrocarbon resources. Oil production in China and India has peaked or is about to peak. This will lead to increased reliance on imported oil and gas from a limited number of politically and economically unstable countries and regions.

The recent visit (June 21-25, 2007) by the Minister of Commerce of Thailand, Mr Krirk-krai Jirapaet, along with a high-level business delegation to Agartala, Guwahati and Shillong, has sparked a lot of interest for mutual cooperation between Thailand and some of the north-eastern States. While the opportunities abound for sharing experience and expertise of Thailand, cooperation in hydro power development was identified as one of the major areas for initiating a plan of action.

New opportunities for energy integration:

 Regional energy integration has long been a major thrust in the context of South East Asian regional cooperation. It has been based on the premise that the very existence of energy resources in each of the East and South East Asian countries provides adequate incentives for trading. All of South East Asia’s countries would benefit by combining their much-needed energy imports and distributing power through a common grid. Luckily, the new economic and political landscape of the subcontinent today makes this a real possibility.

 South Asian countries have some of the lowest per capita commercial energy consumptions in the world, reflecting both limited energy commercialization and low levels of electrification. Almost all of the region’s countries currently have an explicit policy of improving access to electricity. Both India and Bhutan have ambitious goals of electricity for all by 2020. Bangladesh’s poverty-reduction strategy seeks to extend transmission lines to all villages. Pakistan intends to reach another 40,000 households within the next year. And Sri Lanka intends to electrify 75 per cent of its households by 2010. Now, the rising cost of energy, the vulnerability of supply links and the increasing scarcity of energy resources call for an integrated effort for regional development in energy sector. The trade-off between energy-for-growth and energy-for-access has now become visible. Energy shortages are seen as the key impediment to sustaining today’s high levels of economic growth – particularly in services and manufacturing sectors that require uninterrupted energy supply. The emergence of energy security as a national objective in South Asian countries has thus reshaped the demand for energy away from the focus on domestic supply infrastructure for improved access, and towards an increased security of supply. The environmental impacts associated with building large storage dams make them difficult to build and practically impossible to finance. The absence of a transmission grid with enough capacity to bring hydropower from Nepal and Bhutan makes cross border electricity trading even more challenging.

With limited fossil-fuel reserves and constraints on integrating hydro potential, South Asian countries are likely to remain significantly import-dependent. Energy demand has been growing steadily, at over five per cent for most fuel categories, in line with economic growth. Dependence on imported oil is likely to worsen, thereby decreasing the cost-competitiveness of many industries. The good thing is that, for the first time, these countries appear to have conceded that energy-import dependence is here to stay. The challenge that remains is to figure out how to manage supply vulnerability and price volatility. This is precisely where the new opportunity for energy integration emerges.

 India holds the key to the strategy of regional energy integration. The Northeast, as the vital link to the South East Asian countries, could well be the most significant region of the country in this regard. And hence, development of power and energy through proper utilization of the resources is the need of the hour.  India’s pivotal role in regional energy integration is consistent with its growing aspiration to be a global energy processing hub. An integrated South Asian energy market, with India as the hub, could afford member countries the opportunity to be more ambitious in their energy planning. Today, the new geopolitics makes it likely that India’s status as the forerunner will make it easier for other countries to connect with it during the process of regional energy integration.

References:

     1.   Bajpayee, Chietigj, Global economy: India, China locked in energy game, Asia Times, March 17, 2005

     2.   Blij H j de and Muller, Peter O. (1997) (ed), Geography: Realms, Regions and Concepts, John Wiley & Sons Inc., New York

     3.   Kesseler, Carol, Energy Cooperation in NE Asia, PNWCGS Publication, 2007

     4.   Lees, Graham, Burma is Key to India’s ‘Look East’ Economic Strategy, World Politics Review, 19 July 2007

     5.   Macdonald-Smith, Angela, China and India trying to harness the power of wind, International Herald Tribune, September 19, 2006

     6.   Rao, V V Ramakrishnan, Hydropower in the Northeast: Potential and Harnessing Strategy Framework (Background Paper), 2006

     7.   Thapa, Bishal, Sharma, Amit and Gupta, Rashika, Prospect for Energy Integration, Himal Southasian, April, 2007

     8.   The Security of Energy Supply in China, India, Japan, South Korea and the European Union: Possibilities and Impediments, Paper Abstracts of Second Conference of the Energy Programme Asia (EPA) in cooperation with the Clingendael International Energy Programme (CIEP), Organized by EPA-IIAS & CIEP, May 20-21, 2005

     9.   BACKGROUND, ISSUES & CONCLUSIONS-  report of First Sectoral Summit of NEC to Review Power Sector Programmes in the North Eastern Region, Govt. of India Ministry of development North Eastern Region, held in Pasighat, Arunachal Pradesh (16 – 17 JANUARY, 2007)

   10.   Indian State Plugs Into Bamboo Power, Terra Daily, Dec 16, 2005

   11.   Look East Policy: Arunachal to have six trade points, Behind the News, February 26, 2006

   12.   Prospect for Energy Integration, Himal Southasian, 14 April 2007

   13.   Hydel schemes get boost from Dispur & UN-sponsored group, The Telegraph, July 31, 2007

   14.   Power capacity to go up in NE states, The Hindu, July 31, 2007

   15.   http// www.neepco.com

   16.  NER Databank, http//www.Nedfi.com INCLUDEPICTURE “http://imadworks.rediff.com/cgi-bin/AdWorks/adimage.cgi/1399600_1393116/creative_1399039.gif”\* MERGEFORMATINET —