India aims to add 88,000 MW power capacity by 2017

India aims to add 88,000 megawatts (MW) of power generation capacity in the next five years, power minister Sushilkumar Shinde told a conference of state power ministers in the capital on Tuesday.

This includes 5,300 MW from nuclear power. The country's current power generation capacity is 200,000 MW, with a peak shortfall of 10%.

"We will have to address the issue of fuel availability," Shinde said adding, "a few states are planning to hike tariffs". 

Shinde said the banks have agreed to covert SEB loans into equity. "The National Electricity Fund will give interest subsidy to discoms for two-years," Shinde said.

The most loss-making SEBs or power distribution companies (discoms) are in Uttar Pradesh, Tamil Nadu, Rajasthan, and Punjab, among others.

Meanwhile, deputy chairman of the Planning Commission Montek Singh Ahluwalia stressed that financial condition of discoms is a major concern for India. "I think no bank will lend to power generation companies if the distribution is weak," he told reporters.   

The net loss, after subsidies, of 15 discoms - which account for over 90% of country's power consumption - stood at Rs 27,000 crore for year ended March 31, 2010, as per Shunglu panel report released late last year.