Energy is an essential input for the economic development of a country in im-proving the quality of life of its people. For meeting the growing energy needs of the society at a reasonable cost, power development in India started at the end of the 19th century. To contribute significantly to the overall energy availability in the country, sustained attention is being given to develop and promote non-conventional, alternate and renewable sources of energy as also for the development of nuclear energy.

Today the installed power generation capacity in the country has increased from 1,400 MW in 1947 to 1,04,917.50 MW at the end of 2001-02 comprising 26,261.22 MW hydro, 74,428.82 MW thermal (including gas and diesel), 1,507.46 MW wind and 2720 MW nuclear. In spite of this increase in installed capacity, the energy shortage in India is of the order of approximately 9 per cent. The peak shortage of power averages almost 15 per cent.

The per capita consumption of the power in the country is only 350 units much below the consumption levels in development countries. In order to provide power to all by 2012, additional capacity of 100,000 MW will have to be set up in the next decade. Capacity addition plans for 41,110 MW have been finalized State-wise and project wise for the Tenth Plan period (2002-07). In the central sector, State sector and private sector the capacity addition would be 22,832 MW, 11,157 MW and 7,121 MW respectively. For the year 2002-03, a capacity addition programme of 4109.10 MW has been fixed. The power generation during 2001-02 was 515.271 BU’s comprising 422.001 BU’s thermal, 73.992 BU’s hydro and 19.278 BU’s nuclear. The target of power generation for 2002-03 has been fixed at 545.552 BU’s. The plant load factor has shown a steady improvement over the years and has improved from 52.8 per cent in 1990-91 to 69.9 percent in 2001-02.

To achieve the target of providing power to all by 2012, the Center has initiated a number of steps with the help of the States. These include a programme initiated by the power Ministry for accelerated and planned hydro development after an overall assessment and prioritization with a view to harness an unharnessed estimated hydro potential of more than 150,000 MW and attain the ideal hydro thermal mix ratio of 40:60 which is presently 25:70. In central sector, various hydro schemes with a capacity of over 28000 MW are under different stages of development.

The outlay for power sector during the Xth Plan period was enhanced to about Rs. 143,000 crore which is approximately 214 per cent higher than IX plan Outlay.
  

For a phased development of National Power Grid a number of schemes have been planned such as interconnections link to the northern, western, southern and eastern regions in addition to the existing interconnections. Today the inter-regional power transfer capacity is 4,850 MW. It has been planned to enhance to the level of 30,000 MW by 2012 through various interregional links along with transmission highways. United load dispatch centers are being commissioned for northern and southern regions to help regulate the respective grids.

The government is pursuing reform measured expeditiously. The Central Electricity Regulatory Commission, formed under the previsions of Electricity Commission Act, 1998 has been made fully functional. The commission has passed orders on availability-based tariff and has also notified terms and conditions for determination.