Assam’s energy security goals

Assam produces less than 18% of its peak-hour electricity demand, which is reflective of vulnerabilities in the state’s energy sector. The state spends on average Rs 19 crore daily for power purchases from the energy market to meet the shortfall that ranges about 82% of its demand. Expediting the state’s own power generation projects is crucial to sustain the momentum of industrial growth by ensuring a seamless supply of affordable and quality electricity. The ‘Report on Resource Adequacy Plan (Generation) for Assam (2025-26 to 2035-36)’ prepared by the Central Electricity Authority points to critical gaps, addressing which will be crucial to bridge the widening demand-supply gap over the next ten years. The Resource Adequacy Study conducted by CEA reveals a worrying picture that around 58% of the total projected annual energy demand in 2035-36 may not be met under the current contracted capacity. The report states that for meeting the electricity demand reliably and at an affordable cost, the state needs to methodically plan its capacity expansion either by investing in new generation or by procuring power. “In view of the reduction in cost of solar panels and newer technology options like battery energy storage systems, planning for long-term optimal generation capacity mix gains tremendous importance so that the future generation capacity mix is cost-effective as well as environmentally friendly,” adds the report, laying emphasis on aligning increasing power production with the country’s climate action goal to cut carbon emissions and increase generation of green power. The current daily peak-hour electricity demand for the state is estimated at 2842 megawatts, of which the Assam Power Generation Corporation Limited’s own generation is about 285 MW-315 MW, while the Assam Power Distribution Company Limited procures 179 MW of solar power daily from various solar power generation sources in the state. The study found that the peak demand season in the state is from July to September, and daily peak demand is witnessed during non-solar hours. The APDCL attributes the increase in peak demand over the last five years to the addition of approximately 15 lakh new consumers across all categories, with connected load increasing by 2,122 MW; enhanced electrification, reduction in system constraints, network expansion, and quality power supply under the Revamped Distribution Sector Scheme leading to increased power demand; and the state’s GSDP growing at 8-9% annually, driven by infrastructure projects, industrial estates, logistics parks, and expansion in the petroleum, tea, and tourism sectors, leading to higher industrial power consumption. The projected establishment of 11 five-star hotels, data centres and other commercial infrastructure; major industrial projects, including the TATA semiconductor facility at Jagiroad; expansion projects of Oil India Limited and Numaligarh Refinery Limited; the Advantage Assam 2.0 initiative; and manufacturing industries with aggregate demand of approximately 400 MW are expected to add 1000 MW of demand, and renovation and construction of government schools, colleges and institutional infrastructure development will also significantly push the energy demand in the coming years. The requirement of charging power to be supplied by APDCL to two Pumped Storage Projects (PSP) is projected to increase the demand in off-peak hours by about 1800 MW. The PSPs are also called water batteries, as they store energy for electricity generation by pumping water from a downhill reservoir for storing in an uphill reservoir and releasing it through a turbine when electricity is needed. For fragile ecology in Assam and other states in the northeast region, PSP is an environment-friendly technology and offers a pragmatic solution to boost non-polluting electricity production. Renewable Purchase Obligation mandates that a specified portion of energy consumption must be met from renewable energy sources. The CEA sounded the alarm bell in its report that any deviations in the commissioning schedule of the planned capacity could result in a situation where the state is unable to meet the projected peak demand and energy requirements, and such changes may also lead to an increase in the cost of meeting the state’s power demand reliably. Lessons must be learnt from long delays in project execution arising from multiple factors, including delay in land acquisition, smaller window for construction activities due to monsoon, funding issues, delay in environmental clearance, etc., to ensure that planned projects do not miss the target deadlines. Apart from boosting commercial and large industrial expansion, availability of affordable power round the clock is also pivotal to boost MSME growth in the state so that machinery used in enterprises such as rice mills, oil expellers, food processing units, textile units, packaging units, dryers and ovens, and refrigeration units which run on electricity are optimally utilised to boost production and increase earnings. Sustainability of both large industrial units and MSME units is crucial to boost industrial production and generate employment and livelihood and create business opportunities in production and marketing value chains. The state prioritising increasing its own power generation is an urgent need of the hour.