Source: KERALA: SOLAR COMMISSON REPORT
SOLAR SCAM: VIEW FROM A GLOBAL WINDOW
This blog was crafted four years ago in August 2013, when Justice Sivarajan took aver as Solar Commission. Sarita, a young woman entrepreneur had ventured into the business of promoting the highly subsidized solar power program of Central Government, using German equipment and systems. For our vastly under-developed local media it was a god-sent incentive for weaving sexy stories.
Sarita was harassed and mentally tortured under the cover of a judicial commission. In sharp contrast to the ongoing actress abduction case, no feminist turned up in defence of this woman entrepreneur. And, nobody is concerned about how society was benefited by this judicial enquiry lasting around fifty long months and costing some 50 million Rupees. Has Kerala society gone sick, far beyond redemption?
Einstein was awarded Nobel Prize in 1921, for his discovery of the law on photoelectric effects. But, practical photo-voltaic devices were developed and used, much earlier by German scientists, even by the end of nineteenth century. None of these great scientists could have imagined that their inventions would lead to such novel scandals and highly imaginative agitations, in the god’s own country like ours.
The first photo-voltaic device, I personally handled, was a simple photometer manufactured in East Germany for use in conjunction with a Flexaret box camera, made in socialist Czechoslovakia. Even an unskilled photographer like me could produce good quality photographs, using these simple devices. That was in the early sixties: During the past half century, there were dramatic changes in politics as well as science and technology, including the technology of image capturing as well as photo voltaic devices.
Photo films have disappeared and film cameras replaced by digital cameras that produce cheap high quality images even without the help of light meters. And, photo-voltaic industry, targeted at electricity generation was growing leaps and bounds during the last two decades, thanks to the Kyoto protocol for containing the so-called global warming, by limiting the use of fossil fuels like coal and oil.
With the developed countries, as a block, refusing to honor their commitment to reduce carbon emissions, Kyoto protocol died a premature death: USA played its Nuclear card, and now European Union led by Germany is playing the Solar card, for substituting fossil fuel electricity: Developing countries like India, who do not have technology alternatives of their own, seem to be helplessly falling in line with the developed countries. Power sector working group for India’s twelfth five year plan has recommended a capacity addition of 20,000 MW each by way of Nuclear and Solar electricity, using equipment and systems, imported from developed countries.
India has signed its nuclear deal with USA for opening up its market for imported nuclear power plants, while its own nuclear power development program is left to stagnate due to funds constraints. And, Indian Prime Minister, on his recent visit to Germany, has contracted a loan of Rs.7, 000 Crore for importing Solar-PV equipment from that country: Germany has been investing heavily in Solar related R&D, during the past decade as part of a national discipline, and presently it accounts for 47 percent of the output of global Solar PV industry. Under-performance of the highly capital intensive Solar-PV sector as a whole is alleged to be the major reason for the current Euro-zone financial crisis.
Despite such difficulties and dissent notes by US energy industry, European Union is going ahead with its Solar-PV program led by Germany. A massive international event is planed in Paris, under the banner of 28th European Photo-voltaic Solar Energy Conference and Exhibition, is scheduled for 30th September to 02 October: Over 4000 delegates from 76 countries and 656 research institutions and industries had participated in the 27th conference held in Munich, last year.
With its less than one percent share in the global solar-PV industry, India was nowhere in the picture: China had an eight percent share and is placed above USA (5%), Netherlands (4%), France (3%), Switzerland (3%), Italy (3%) or Japan (2%). This was in tune with my own personal assessment, when I visited a similar show, about three years ago in Noida, organized by the Ministry of New and Renewable Sources of Energy (MNRSE).
Solar PV industry in India, dominated by the MSME sector, had deliberated at that time on what need to be done in order to improve the national capabilities in Solar-PV sector: Its recommendations are valid even today. The theme paper, prepared at that time, had stressed the need for evolving a “comprehensive research roadmap, in collaboration with Indian universities and national labs, with clearly defined, time bound, technology and cost goals.” These recommendations were aimed at “creating a plan to develop and strengthen the entire Solar-PV supply chain, from silicon feedstock, wafer manufacturing, materials and equipment to end systems”.
Nothing much has happened by way of in-house R&D and technology development, and India’s Solar-PV program continues to be dependent on imported equipment and systems, even today. Nehru was great proponent of technological self-reliance, a policy that had paid rich dividends for the country, as in sectors like nuclear and space technologies. However, programs and projects launched by the Jawaharlal Nehru National Solar Mission as well as the other numerous agencies and public sector undertakings organized under MNRSE, are apparently dedicated to solar power development based on the strength of imported equipment and systems.
Solar PV Value Chain diagram, given elsewhere in this article, is a quote from a well produced recent hand-out, titled India Solar PV Report by Energy Alternative India (EAI-www.eai.in), a professional consultancy body financed by Indian big business and manned by experts drawn from the alumni of IIT’s and IIMs. This document just does not talk about any Indian R&D program on Solar-PV, unlike the industry document, brought out a few years ago.
Perspectives and prescriptions in this EAI document are seen reflected in the programs sponsored by Central and State Government organizations. Even the programs of Solar Energy Corporation of India, the Central Public Sector Unit, recently constituted with Dr. Anil Kakodkar, the former (retired) Chairman of Atomic Energy Commission, are no different with regards to its commitments and loyalty to imported technologies and equipment.
Based on its own interpretation of Electricity Act 2003, MNRES is insisting that power utilities in the country should be brought under legal compulsion to source certain minimum percentage of electricity sold by them from the so called ecofriendly solar power plants, even at higher prices, and even on a cost plus basis, in support of the infant Solar-PV industry and on moral considerations around global warming. German policy experts, who dominate the EU policy making process, argue that these apparent subsidies will disappear within fifteen to twenty years time, when Solar-VP will break even with conventional electricity.
Such policies are naturally welcomed by German industry and their R&D but are not convincing enough for the people of other countries of EU. The ongoing recession and consequent fall in demand are further complicating the economics of power utilities in Spain and Italy: The low cost non-solar power plants are, reportedly, facing irrational shutdowns in these countries..
Policy makers of our MNRES are insisting that similar policies as in EU should be implemented in India as well, in support of the Solar-PV industry. In Europe and Germany, possibly, there is some logic for such policies, because the subsidies go to the local industry. But in our case, we will be subsidizing the Solar-PV industry of Germany, USA or China, because we do not have any national R&D plan to develop our own industry. MNRES is insisting that the EU policy of compulsory buying of energy at higher costs from solar power plants should be implemented, irrespective of the source of technology and equipment.
State level agencies, like the ANERT in Kerala, operate under the supervision and dictates of central ministry. ANERT was an autonomous body directly under electricity department, and it was brought under the control of Kerala State Electricity Board (KSEB) very recently. Delhi was planning to implement, jointly with ANERT, an online Solar-PV power plant of one MW capacity, at Kanchikodu and KSEB is under legal compulsion to purchase energy from this plant, at a prefixed price of around Rs.15 per unit, according to the current norms laid down by MNRES. It, sure, was an attractive proposal and a gold mine for a rural investor holding some stock of black money for paying bribes.
True, Sarita, Shalu, Biju & Co have jumped in to the deal and dirtied the entire solar program with all sorts of scandals and pay-offs, as alleged by the Opposition Leader and fully endorsed by the Chief Minister. However, neither of them seems to be aware of the larger issues involved, and the real issues of governance that affect the life and development of our people.
THE NEED FOR A PARADIGM SHIFT
Engr K Vijayachandran FIE
Crisis in KSRTC continues unabated: Rehabilitation plan finalized by the UDF Government in Jan 2014 failed to take off: This statutory corporation was incorporated in 1965, as a joint venture with the Government of India and as stipulated by the Road Transport Corporations Act of 1950.
Section 3 of the act had authorized the establishment of Road Transport Corporations in the States, ‘considering, (a) the advantages it offered to the public, trade and industry by the development of road transport, (b) the desirability of coordinating any form of road transport with any other form of transport and, (c) the desirability of extending and improving the facilities for road transport in any area and of providing an efficient and economical system of road transport service therein’.
According to Section 18 of the act, ‘general duty of an RTC was to exercise its powers, as progressively to provide or secure or promote the provision of, an efficient, adequate, economical and properly coordinated system of road transport services in the State or part of the State for which it is established and in any extended area.’
According to Section 7 ‘the State Government may, after ascertaining the views of the Corporation, by notification in the Official Gazette, to constitute one or more Advisory Councils consisting of such number of persons, on such terms, and for the purpose of advising the Corporation on such matters, as may be specified in that notification.’
According to Section 7A ‘where a Corporation is satisfied that it is expedient for the more efficient discharge of its functions, it may, with the concurrence of the State Government and the Central Government, frame by notification in the Official Gazette a scheme or schemes providing for the establishment of one or more subsidiary corporation.’
All these indicate that the RTC Act 1950 was intended to establish institutional capabilities at the state level for the development and regulation of road transport infrastructure. SRTCs were not conceived as socialist enterprises: they were conceived as public utilities to help economic development based on the historical experience of industrial countries.
However, this did not happen as envisioned by the law makers of 1950: State-reorganization and subsequent delays in the formation of effective governments, role conflicts with local RTAs and motor vehicles departments, as well as vested interests of private road transport operators had contributed to delays and policy confusion that continues to exist even today.
When I took up my first study on KSRTC in 1985, the general belief or consensus was that KSRTC should prove its mettle by competing with private operators (1). Detailed analysis had shown that the inefficient and comparatively high-cost private operators were making profits because they avoid or skip unprofitable routs and schedules, where as KSRTC was duty-bound to operate them. This is a common experience: When public and private enterprises share a common market, private sector appropriates the surpluses and losses are forced on public sector.
However, the situation was seen slowly changing by the time I did the second study, eight years later in 1993 (2): Many RTCs, especially in southern states, had strengthened their regulatory role as envisioned in the statute, not only by increasing their relative fleet strength and expanding into rural areas and also by decentralization of the management. District-level subsidiary corporations headed by an young IAS officer, supported by competent senior technical staff and well equipped workshops, as I could witness in Kanyakumari district, were in sharp contrast with the KSRTC divisions or depots, remote-controlled by the Chief Office at Thiruvananthapuram, under he shabby management culture inherited from the colonial days of Travancore Maharaja. Even small towns like Thakkala were well connected with their rural hinterlands by locally managed town services, organized by Nesamony Transport Corporation headquartered at Nagarkoil.
Years later in 2007, as I wrote a review on Transport Infrastructure in Kerala, situation had further improved in Tamilnadu and also in Andhra, compared to Kerala. Quoted below are passages from this article, later published as my wordpress blog (3): https://kvijaya40.wordpress.com/2017/07/27/kerala-infrastructure/
“State Road Transport Corporations plays a leading role in organising comparatively efficient public transport systems in most other states. In this respect, Kerala lags far behind other southern states: It has only one RTC and most parts of the state are dominated by private buses which simply outnumber KSRTC buses by eight to one. There are only 135 RTC buses per million population in Kerala, compared to 284 in Tamilnadu and 253 in Andhra Pradesh…..
…Dependency on private bus operators has resulted in extremely poor vehicle utilisation: There are more than 1100 passenger buses per million population in Kerala, compared to 393 in Tamilnadu and 253 in Andhra. And, these numbers do not include the large number of mini buses and vans that operate illegal passenger services on Kerala roads. Public transport is hardly any better in Kerala, despite the much larger deployment of passenger buses and other vehicles which are over-crowding the road network work……
….Number of three wheelers per million population in Kerala is nearly three to four times that of TN and AP. In the use of two wheelers, Kerala is far ahead of the other two states, if mopeds are excluded from the count. Kerala has relatively large number of personal vehicles including taxis and private motor cars…
.. It has 112 thousand motor vehicles on the road, compared to 72 in AP and 132 in TN: On area basis, AP has only less than one-fourth and TN about two-third number of vehicles on the road compared to Kerala. Karanataka is, possibly, no different:
…. accident rate per vehicle in Kerala is nearly double that of the other two states. The fact that more than sixty persons die on Kerala roads every week, is an indicator for the poor quality of road transport infrastructure in the state
….Intra-district and city-town services are the weakest links in the public transport network of Kerala and these public transport segments are mostly under the tyranny of small-time private bus operators and the Regional Transport Authorities headed by the district collectors. Routes and licences given to private operators become their private property, subject to judicial reviews even by the High Court.
….It is high time that public road transport network get liberated from these archaic statutes and brought on par with more civilised countries, where it is organised inevitably under a public monopoly.”
Galloping vehicle population in Kerala was breaking down its roads and, State PWD was failing to catch with their repairs and maintenance, despite the massive Rs.2000 Crore World Bank project. There were 39,137 road accidents in 2016 according to State Crime Records Bureau, and this was an all time record. Two wheelers, which account for nearly two-thirds of the vehicle population, were involved in more than half of these accidents.
Failure of public transport system has created a boom in the two-wheeler market of Kerala. Death rates due to road accidents had crossed even the ten per day mark, three years ago. Damaged and abandoned vehicles on the roadsides are a common sight; another sort of pollution caused by motor vehicles.
State Planning Board recently made a detailed review of the 161,000 KM length of Kerala roads: Road density in Kerala was 414 km/100 sqkm, the highest in any state and more than five times the national average. Road length per lakh population was 506 km in Kerala, against the national average of 259. Kerala with a population density of more than double the national average was cautioned against this liberal use of land for roads.
All these factors, rapid rise of vehicle population, increasing rate of fatal and non-fatal road accidents, and rapidly deteriorating road conditions call for an urgent paradigm shift in the organisation and management of KSRTC: The state could be guided by the reform experiences of other RTCs. Unfortunately, the specialist consultant appointed by Kerala Government, Prof Khanna, has not cared to look at the problems of this statutory body from an all-India perspective.
Neither has he cared to study why the rehabilitation package of 2014 simply failed to take off. He had two-day long discussions with the union leaders and senior executives of KSRTC in December last year at the Centre for Development Studies (CDS). He has reportedly left the country after making a fifty-slide presentation, and was not available for any discussion.
Proposals like replacing diesel buses with LNG buses, starting of super-fast services, wet-leasing of high-tech buses from foreign automobile giants etc, as publicised by the CEO of KSRTC through newspapers are not mentioned in the revival package suggested by the specialist consultant. He has not proposed even a preliminary plan for financial restructuring of the corporation.
This sort of casual approach toward the KSRTC crisis should end immediately, considering the seriousness of the crisis facing this statutory body as well as its 30,000 employees and 37,000 pensioners. There has to be a paradigm shift in the Government approach as well as in the perceptions of general public.
Director board of KSRTC presently has 15 members; eight of them official and seven non-officials. Selection of the seven non-official directors has not attracted any adverse criticism so far, but that does not mean; it was done in the best interests of KSRTC and the people of Kerala. Paradigm shift means a critical review of this board composition and corrective action as necessary.
RTC Act demands timely preparation and submission of annual reports and audited accounts of this statutory body, and getting them reviewed by CAG and state legislature. These were meticulously followed in the past and audited reports were readily available during my second study of KSRTC in 1985. The practice has been virtually discontinued: Paradigm shift means zero tolerance towards such administrative lapses
RTC Act provides for one or more advisory boards for helping the statutory bodies on policy issues. However, neither the government nor the CMD of KSRTC has found such advisory bodies to be of any relevance. Possibilities with such advisory boards should be explored at the cabinet level.
And again, the RTC Act suggests incorporation of subsidiary corporations for serving the regions or districts in the state more efficiently. Consultative forums with the participation of district administration could serve as advisory committees for these district level bodies: Success stories of such reforms from Tamilnadu and other states should encourage KSRTC to embark on such reforms.
NATPAC of Kerala (4) as well as the Association of State Road Transport Undertakings (ASRTU) (5) could guide the proposed district level RTCs in re-designing and re-scheduling of operations, taking into account the local needs as well as the interests of local bus operators and their employees. Faculties and students of local professional colleges could be associated in such programs.
Schedules and tariffs could be decided to suite local and regional requirements and for ensuring traffic operations on a no-loss no-profit basis, with the support of a calibrated subsidy system to be administered by the state government.
KSRTC has a net-work of offices, depots and workshops across the state covering all the 14 districts (see map) for implementing a truly state-wide plan in which even the retired employees could participate in case they so desire: Total land holding in 14 districts is estimated at 427 Acres.
Kerala Govt could learn from the experience of other states and take measures to restructure and reorganise KSRTC in line with the provisions of the RTC Act: A DPR for this with the objective of KSRTC jointly with the proposed 14 district level subsidiaries organizing urban transport services, in the 86 municipalities and 6 municipal corporations that would effectively network with their 941 neighbouring village panchayats. And, the inter-district and inter-state services need to be integrated into this state-wide network (6)
The programme will need an additional fixed capital of around Rs.650 Crores in the next four years: Rs 500 Crore for 2000 new buses and Rs. 150 Crores for plant and machinery and office equipment for the 14 subsidiaries. We may add another Rs.350 Crore to this, and conceive a Rs. 1000 Crore five-year plan for building a state wide road transport infrastructure under the banner of KSRTC. And that is just nothing compared to the massive high-tech projects with imported systems and technologies.
These investments could be easily financed by the savings in the economy for a year or two. And, we may not need global consultants for preparing a DPR for this: Centre for Management Development (CMD) and/or Institute for Management in Government (IMG) could be asked to provide the advisory services for the reorganisation and restructuring of KSRTC and preparing a DPR as necessary.
The paradigm shift essentially means, looking at KSRTC as the statutory body for the development and regulation of road transport in Kerala, as envisaged in the RTC Act and not as a mere bus operator competing with private operators.