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Time and cost over-runs of the power projects in Kerala

Author

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  • N. Vijayamohanan Pillai

    (Centre for Development Studies)

  • K.P. Kannan

    (Centre for Development Studies)

Abstract

Delays in project implementation and the attendant cost overruns have been a regular feature in the electric power sector in Kerala. Almost all the public projects, including the prestigious major hydroelectric project of Idukki, have been the unfortunate victims of time and cost overruns on account of a number of avoidable factors, labour disputes being singled out as the prime villain. In this paper we take up a detailed analysis of the cost of inefficiency involved in the time and cost overruns in the power projects of the KSEB, and their possible causes. We find that the arguments by the government in favour of private sector participation in power generating capacity addition, under the pretext of a severe resources crunch, is flimsy to the extent that the government is actually over-spending on each of the projects undertaken. We find that the real problem arises not out of a shrinking coffer but out of the inefficiency of management coupled with the political economy of vicious rent seeking.

Suggested Citation

  • N. Vijayamohanan Pillai & K.P. Kannan, 2001. "Time and cost over-runs of the power projects in Kerala," Centre for Development Studies, Trivendrum Working Papers 320, Centre for Development Studies, Trivendrum, India.
    • Handle: RePEc:ind:cdswpp:320
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    File URL: http://www.cds.edu/wp-content/uploads/2012/10/wp320.pdf
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    References listed on IDEAS

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    1. K.P. Kannan & N. Vijayamohanan Pillai, 2001. "The political economy of public utilities: A study of the power sector," Centre for Development Studies, Trivendrum Working Papers 316, Centre for Development Studies, Trivendrum, India.
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    Cited by:

    1. Edwin Thomas Banobi & Wooyong Jung, 2019. "Causes and Mitigation Strategies of Delay in Power Construction Projects: Gaps between Owners and Contractors in Successful and Unsuccessful Projects," Sustainability, MDPI, vol. 11(21), pages 1-16, October.
    2. Thomas, Jayan Jose, 2005. "Kerala's industrial backwardness: a case of path dependence in industrialization?," World Development, Elsevier, vol. 33(5), pages 763-783, May.
    3. Goutom K. Pall & Adrian J. Bridge & Jason Gray & Martin Skitmore, 2019. "Causes of Delay in Power Transmission Projects: An Empirical Study," Energies, MDPI, vol. 13(1), pages 1-29, December.
    4. N. Vijayamohanan Pillai, 2004. "CES function, generalised mean and human poverty index: Exploring some links," Centre for Development Studies, Trivendrum Working Papers 360, Centre for Development Studies, Trivendrum, India.
    5. Bhatt, Brijesh & Singh, Anoop, 2020. "Stakeholders’ role in distribution loss reduction technology adoption in the Indian electricity sector: An actor-oriented approach," Energy Policy, Elsevier, vol. 137(C).

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    More about this item

    Keywords

    Kerala; power sector; time and cost overruns; labour disputes; corruption;
    All these keywords.

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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