Revamping India’s Power Sector: The National Electricity Plan 2022-2027

The National Electricity Plan for 2022-27 has gained significant attention as it presents a new roadmap for power sector planners in India. 

This plan marks a notable shift in policy direction, aiming to address the challenges faced by one of the world’s fastest developing nations in terms of GDP and electricity consumption. 

With a population of approximately 1.3 billion people, India is in constant pursuit of meeting the energy demands of its rapidly growing economy. 

Background

India’s power sector faces the dual challenge of supporting its economic growth while ensuring access to electricity for its vast population. In this regard, the Electricity Act of 2003 serves as the guiding framework for the country’s power sector. 

The act emphasises the importance of providing reliable and affordable power to all citizens, with a particular focus on uninterrupted supply throughout the day.

What is the National Electricity Plan for 2022-2027?

The National Electricity Plan (NEP) serves as a crucial document that shapes the development of India’s power sector.

The NEP reviews the performance of the previous five-year period (2017-2022) and identifies the need for capacity additions from 2022 to 2027. Additionally, it provides predictions and forecasts for the subsequent period from 2027 to 2032.

The Second NEP was notified in December 2013, following the initial NEP notification in 2007. The third plan, published in 2018, incorporates both the projected plan for 2022-27 and the detailed plan for 2017-22.

Key highlights of the plan

The recently unveiled draft of the National Electricity Plan for 2022-27 introduces significant changes in the expansion of coal-fired capacity, considering the growing energy needs of the country. 

In contrast to the previous emphasis on renewable energy, the draft proposes an additional coal-based capacity ranging from 17 GW to nearly 28 GW by 2031-32.

This proposed expansion is in addition to the ongoing construction of 25 GW of coal-based capacity. It is worth noting that a similar proposal was made by the Central Electricity Authority in the preceding year.

According to a report by the CEA, apart from the ongoing construction of coal-based capacity totaling 25 GW, there might be a requirement for an additional coal-based capacity ranging from 17 GW to approximately 28 GW by 2031-32.

Related challenges

While the plan acknowledges the need for expanding coal-based capacity, it also highlights several challenges associated with India’s power sector. 

The age and utilisation of antiquated technology in the country’s coal-fired thermal power plants raise concerns about the reliability of the grid and frequent power outages.

Inadequate funding

The successful integration of renewable energy sources and the adoption of battery storage technology require significant investments. 

To support renewable generation effectively, the Central Electricity Authority estimates a funding requirement of approximately 14.30 lakh crore between 2022 and 2027 for Battery Energy Storage Systems (BESS).

Conclusion

The National Electricity Plan 2022-2027 plays a vital role in shaping India’s power sector, addressing the challenges associated with meeting the energy demands of a rapidly developing economy and a vast population. 

The plan’s key highlights, including the proposed expansion of coal-based capacity, reflect the need to balance renewable energy sources and conventional power generation to ensure a reliable and uninterrupted power supply.