sksoonee@posoco.

in


Institutional Capacity Building of the Load Despatch Centres in India

S. K. SOONEE, S. R. NARASIMHAN, V. PANDEY
Power System Operation Corporation Limited
and
LOKESH CHANDRA
Ministry of Power, Government of India
India
SUMMARY

In India there are close to forty (40) Load Despatch Centres (control centres) for power system and
electricity market operation. In order to assess capabilities of these Load Despatch Centres (LDCs), a
nationwide survey was conducted with the help of a questionnaire. This paper draws inferences from
the findings of the survey. It emphasizes that institutional capacity building of the LDCs in India is
highly relevant in view of the ongoing reforms and restructuring, increasing vulnerabilities of the
interconnected grid, rapid growth in the interconnection size, generation capacity addition,
equipment/human failure, cyber attacks, environmental threats and fast changing regulatory
framework in India. The paper argues that the effective coordination amongst the system operators can
come by establishing functional and financial autonomy of the LDCs as well as by strengthening the
capabilities of the human resource working in the LDC.

The paper provides an overview of the recent initiatives being taken by the policy makers, regulators
and the utilities in India for institutional capacity building of the LDCs. Most significant amongst
these are the recommendations of the committee constituted by the Union Ministry of Power (MoP),
Government of India (GoI) on manpower, certification, and incentives for system operation and ring
fencing of LDCs; the report of the various task forces set up by the MoP for implementation of the
recommendation of the committee; the Regulations on fees and charges of the LDCs notified by the
Electricity Regulatory Commission; the formation of Forum of Load Despatchers (FOLD); the
creation of ISO structure for operation of the National and Regional LDCs; and the programme for
training and certification of power system operators in India being undertaken. The paper opines that
the recent initiatives are significant as they would help in improving the awareness of the overall status
of the interconnected power system in India and coordination amongst the System Operators. It argues
that institutional capacity building of the LDCs in India would be instrumental in synergizing the
benefits of the various reform initiatives in the sector. The paper also highlights the various issues
being faced in the implementation of the various initiatives and provides a future outlook.

KEYWORDS

TSO, ISO, Control Centre, System Operator, Security, Reforms, Manpower, Training, Certification


21, rue dArtois, F-75008 PARIS C2-211 CIGRE 2012
http : //www.cigre.org

2

1. INTRODUCTION

Electrical load dispatching gained prominence in India in 1964 when five Regional Electricity Boards
(REBs) were constituted through a resolution of the MoP, GoI. The REBs have been reconstituted and
now they are known as Regional Power Committees (RPCs). Term Load Despatch Centre was
explicitly mentioned in the statute for the first time in the 1991 amendments to the Electricity Supply
Act 1948. Later the 1998 amendments to the Electricity Supply Act 1948 designated LDCs as apex
bodies to ensure integrated operation of the power system within their area of jurisdiction. The same
status is given to these bodies under the Electricity Act 2003. Thus, the LDCs now have the status of
statutory bodies in India.




Figure-1 : Institutional set up of power sector in India Figure-2 : Load Despatching

Presently the power system in the country is demarcated into five regional grids and all the States and
Union Territories in India fall into one of these regional grids. There is a three-tier hierarchical
structure for Load Despatching comprising of the State Load Despatch Centres (SLDCs), Regional
Load Despatch Centres (RLDCs) and National Load Despatch Centre (NLDC) [refer figure-2]. The
functions, responsibilities and powers of the NLDC/RLDC/SLDC are clearly defined in the Electricity
Act 2003 and further elaborated in the Indian Electricity Grid Code notified by the Central ERC.

2. STAKEHOLDERS CONCERN

Electricity Act, 2003 [1] enacted by the Indian Parliament provides an enabling framework for
accelerated development of power sector in India. The Act has delicensed generation and it seeks to
encourage competition with regulatory intervention. As a part of the reform process, Electricity
Regulatory Commissions (ERCs) have been constituted by the respective Governments at the Central
as well as at the State level. Several regulations have been passed by these ERCs to facilitate the
development of competitive and vibrant electricity market in India [refer Table-1]. These regulations
have been implemented quite effectively at the inter-State level and efforts are being made to achieve
similar results at the the intra-state level.
Table 1: Inter State Electricity Market -Enablers and salient features
ENABLERS SALIENT FEATURES
Legislation- Electricity Act 2003 Coordinated Planning
National Electricity Policy 2005 De-licensed generation
License for transmission, distribution, trading Landmark Regulations
Availability Based Tariff 2000
Electricity Grid Code 2000
Open Access 2004, Power market 2007
RLDC fees and charges -2009Renewable
Energy Certificate 2010
Sharing of inter-State Transmission Charges
and Losses - 2010
Transmission System Operator barred from trading
Connectivity, Long term Access
Medium term Open Access
Short term Open Access
Multiple Power Exchange
Decentralized Scheduling, Congestion Management
Settllement System
3

The success in the intra-State level is essential to make a perceptible difference in quality of power
supply to the end consumer and promoting competition by moving away from the single buyer model.
Further the intra-State system is vital for ensuring reliability of the power system on account of
increasing vulnerabilities of the interconnected grid due to rapid growth in the interconnection size,
generation capacity addition, equipment/human failure, cyber attacks and environmental threats.

A literature survey was carried out on the subject of institutional capacity building of System
Operation [2, 3, 4, 5, 6, 7]. A nationwide survey of LDCs was also conducted with the help of a
questionnaire to be filled by respondents at various LDCs in India. Total 37 control centres were
surveyed and 777 responses were received. The survey revealed the profile of the personnel employed
at LDCs.

3. MAJOR INITIATIVES FOR INSTITUTIONAL CAPACITY BUILDING OF LDCs

A consultative process was initiated by the GoI and the interactive session convened by the MoP on
05
th
November 2007 with State Governments and ERCs was the most significant in this regard.
Subsequently a committee was constituted by the MoP, GoI in February 2008 to examine issues
relating to manpower, certification and incentives for the LDC personnel and also for ring-fencing the
LDCs to ensure their functional autonomy. [Hereafter referred in the paper as MoP Committee]. The
report of the MoP Committee was submitted in August 2008 and it was endorsed by the Central and
State Governments as well as Central and State ERCs. Subsequently three Task Forces were
constituted by MoP- GoI and one Task force by the CEA for effective monitoring and implementation
of the recommendations of the MoP Committee. The sections ahead discuss various issues highlighted
in the report by the MoP committee and the four Task Forces [8, 9, 10, 11]. The emerging issues
during the implementation phase have also been summarized.

The MoP committee recognized load dispatching as a mission critical activity for uninterrupted and
reliable power supply; a facilitator for an efficient electricity market; an optimizer of precious
power generating resources; an instrument for equitable and fair use of the transmission
infrastructure and an indispensable link between the managers, administrators, planners and
regulators on one end and the physical system on the other end. The committee has also envisaged
LDCs role in facilitation and deployment of renewable energy sources. It was also of the opinion that
the strengthening of LDCs in India would yield substantial gains to all stakeholders. It recommended
several strategic interventions for imparting functional and financial autonomy to LDCs.
Table 2: Salient features of the four Task Forces
Task Force Terms of reference Report date
TF-1 Oversee implementation of the recommendations of MoP Committee -
TF-2 Financial augmentation and up gradation of SLDCs and issues related
to emoluments for the LDCs personnel
March 2009
TF-3 Selection/recruitment procedures and tenures for the personnel in LDCs June 2009
TF-4 Training and certification of System Operators March 2010

4. FUNCTIONAL AUTONOMY OF LOAD DESPATCH CENTRES

Till 1994, Central Electricity Authority (CEA) was responsible for regional system operation in India.
CEA did not own any transmission assets and it was the transmission system planner and operator. As
a part of the reform initiatives of the GoI, a separate enterprise by the name of National Power
Transmission Corporation (later name changed to Power Grid Corporation of India or POWERGRID)
was created in 1989 by amalgamation of the transmission wings of generating companies owned by
the Central Government. This enterprise was subsequently designated as the Central Transmission
Utility (CTU) and the responsibility of System Operation at regional level was also assigned to it. It
would be interesting to note that in 1989-90 in the Central Electricity Generating Board of Great
Britain was also unbundled into a Transmission Company (National Grid) and two generating
4

companies and privatized. However the primary objective of unbundling transmission from generation
in India in 1989 was to facilitate faster development of transmission sector whereas in case of United
Kingdom the need was promote a competitive market.

Creation of CTU resulted in establishing the TSO structure (Transmission + System Operator) at the
regional level in India. The CTU was also barred from trade of electricity through appropriate
legislation. Transmission tariff was also kept insensitive to the power flows on the network. This
ensured the neutrality of the TSO in the electricity market. The underlying idea was to avoid conflict
of interest between generation and transmission; facilitate non-discriminatory open access in
transmission and thus create a level playing field for suppliers of electricity to compete in the
electricity market. The five RLDCs were transferred from CEA to CTU between 1994 and 1996.
Later, when NLDC was constituted under Section 26 of the Electricity Act-2003, the CTU was
assigned the responsibility to operate it.

The spirit of the provisions of the Electricity Act is to ensure independent system operation through
NLDC, RLDCs and SLDCs. These LDCs, as per the provisions of the Act, are to be operated by a
Government company or authority as notified by the appropriate government. However the Act makes
a provision that till such time these agencies authorities are established, the CTU or STU, as the case
may be, shall operate the RLDCs or SLDCs. Recently a wholly owned subsidiary of POWERGRID by
the name of Power System Operation Corporation Limited (POSOCO) has been created as per the
directives of GoI in July 2008. POSOCO has been entrusted the responsibility of coordinating the
operations of the National and Regional LDCs w.e.f 1
st
October 2010. Thus, at the National/Regional
level, an Independent System Operator or an ISO structure has been established.

The entities at the State level are being encouraged to emulate the initiatives at the regional level. The
State Electricity Boards (SEBs) in several States have been unbundled into generation, transmission
and distribution companies and the State LDCs were associated with the respective transmission
utilities as a TSO structure. Recognizing the importance of State LDCs in the whole framework, the
MoP committee had urged the State Governments to create a separate representative board structure
for governance of SLDCs. Thereafter, the Task Force-3 recommended establishing a subsidiary
company under State Transco for operation of SLDCs wherein staff could be taken on deputation or
secondment. It argued that separate cadre for SLDCs would not be feasible as ensuring good career
prospects of staff might be difficult. Apart from the governance structure, the functional autonomy of
the LDC head is also influenced by the procedure adopted for recruitment and tenure of the LDC
personnel. The Task Force-3, has given detailed recommendations on these aspects. All the above
recommmendations are being taken up gradually for implementation by different States.

5. INFRASTRUCTURE AND SYSTEM LOGISTICS

The augmentation of control centres at RLDCs/SLDCs was taken up as a Unified project by the CTU
between1998-2006. These systems were based on the state-of-the-art technology at the time of
conceptualization. However considering the pace of technological obsolescence and the rapid
expansion in the network as a part of the capacity addition programme, the SCADA/EMS systems
available at most of the control centres require massive up-gradation and augmentation to meet the
present and future requirements.

The nationwide survey of LDCs had revealed the need for augmentation of civil infrastructure to
ensure availability of conference rooms, housing for employees (wherever required), creation of
knowledge centre, office equipment, staff recreation facility. It was also found that augmentation of IT
infrastructure was required in terms of hardware and software for SCADA/EMS system, local control
centre level monitoring equipment, control centre component of wide area measurement and
protection system employing synchrophasor technology, control centre component of weather stations,
Market Management Systems (MMS), auxiliary services like Uninterrupted Power Supply (UPS), DG
set, back up control centre as part of Disaster Management Plans, Cyber Security etc. Need was felt
for equipping the LDCs with offline software for system studies, scheduling of transactions,
5

processing of requests for open access, metering & settlement system, data warehousing & mining,
website hosting, knowledge management system, etc. In order to achieve the above, the MoP
committee recommended that the LDCs should prepare rolling Capital Expenditure (CAPEX) plans
and get them approved by the appropriate regulatory commissions. With regard to the adequacy of
communication infrastructure, the MoP committee recommended that the respective CTU/STU could
coordinate the same and recover the investment as a part of tariff approved by respective ERCs. This
aspect has been further elaborated in the Report of the TF-2.

6. ADEQUACY AND COMPETENCE OF MANPOWER

The LDCs have the responsibility to operate interconnected grid comprising of assets owned by other
agencies. There are huge implications for human safety, system reliability, national economy and
legality of operation. Therefore it is essential that the operators are adequately competent, well versed
and intellectually sound to handle the challenges associated with their statutory responsibilities.
Section 5.1 (h) of the Indian Electricity Grid Code 2010 notified by the CERC mandates that the
control rooms of the RLDCs, SLDCs and power plants, substation of 132 kV and above, and any other
control centres of all regional entities shall be manned round the clock by qualified and adequately
trained personnel.

A survey of Load Despatch Centres in India had revealed problems such as inadequate staff, aging
workforce, absence of appropriate training for operators, non-existent systems for Knowledge
Management (KM), inadequate opportunities for self-learning and limited avenues for professional
engagement [refer figure-3 and figure-4]. The present strength of executives in LDCs at all levels in
India is estimated to be 1200. Considering an average requirement of executives (60-70) in a typical
LDC, the total skilled professional required for thirty-nine (39) LDCs all across the country would be
in the range of 2350 to 2750. These professionals would be required to take up existing and additional
work load arising out the need for greater technical/administrative coordination among utilities in an
interconnected system, growth in electricity market related transactions, increased population of
distributed generation (Renewable Energy Sources) in the grid and emphasis on system reliability. The
NLDC, RLDCs and SLDCs are also managing several Pool Accounts and funds such as the Power
System Development Fund.


Figure 3: Age profile of LDC personnel Figure 4: Exposure LDC personnel in
transmission technology
The MoP committee recommended adequate staffing of LDCs, introduction of a incentive-linked
system of certification of System operators by an independent agency, similar to the system followed
in case of Air Traffic Controllers; fresh recruitment at regular intervals, introduction of suitably
designed courses at Indian Institutes of Technology and National Institutes of Technology for ensuring
availability of skilled manpower and active collaboration of LDCs with educational institutes.The task
force TF-4 has elaborated upon this further. The MoP committee recommended adequate staffing of
LDCs, introduction of a incentive-linked system of certification of System operators by an
independent agency, similar to the system followed in case of Air Traffic Controllers; fresh
recruitment at regular intervals, introduction of suitably designed courses at Indian Institutes of
Technology and National Institutes of Technology for ensuring availability of skilled manpower and
6

active collaboration of LDCs with educational institutes.

An elaborate programme has been chalked out by POSOCO in collaboration with the National Power
Training Institute for training and certification of System Operators. A two week classroom course
with batch size of around thirty each has already commenced. The basic study material has been
prepared which is being further refined in a collaborative manner. Nearly 200 system operators were
trained in basic level between April 2011 to September 2011. Over 300 system operators took the first
online certification exam held on 6
th
Nov 2011 and over 82% percent of candidates qualified. Periodic
certification exams for basic level is expected to be held at least twice a year so that the entire
community of load dispatch engineers in the country is covered. The next challenge would be to have
the specialist level certification courses on power system simulation and electricity market operations
by 2012.

7. BUILDING TECHNICAL SOLIDARITY AMONGST SYSTEM OPERATORS

The functions carried out by the LDCs are similar and there is huge scope for synergy and
collaboration. Further the functions discharged by LDCs are knowledge based services. It would
require pooling of domain experts and creation of work environment that facilitates continuous
learning with evolving system and market design. In order to achieve the above objectives, the Forum
of Regulators constituted the Forum of Load Despatchers (FOLD) as recommended by the MoP
committee. The FOLD has created a mechanism to leverage the technical expertise available at LDCs
at the State level and the National/Regional level. It is also trying to harmonize the operating
procedures at various control centres.

8. COMPENSATION AND INCENTIVES FOR PERSONNEL AT LDCs

Considering the specialized and technical nature of LDC function, the MoP committee recommended
that compensation for LDC personnel should be substantially higher than comparable companies in
the power sector both in public as well as private. It also recommended monetary schemes linked to
acquisition of basic/specialization level certificates and other schemes such as sabbaticals for higher
learning and opportunities for professional engagement in the form of attending seminars/workshops
and conferences in India and abroad.

Review of the emoluments available to personnel at various LDCs by the Task Force-2 revealed that
there is a considerable variance in the emoluments received by the personnel working at various
LDCs. This was due to the difference in the pay structure, pay scales and perquisites offered by the
respective organizations operating the LDC. The task force TF-2 discussed these issues and suggested
an alternate way to move forward. It has proposed a two-part compensation structure- fixed and
variable. The fixed part comprising of the basic pay and perquisites could be based on the pay scale of
the respective organization. The variable part comprising of the performance related pay (PRP) and
other incentives could be based on a common criteria adopted uniformly across all LDCs. The TF-2
also recommended that Key Performance Indicators (KPIs) need to be defined by respective
Electricity Regulatory Commissions and the PRP component linked to achieving these KPIs.

9. FINANCIAL AUTONOMY OF LOAD DESPATCH CENTRES

Financial autonomy is vital for independent functioning of the LDC. In the bundled set up the LDCs
were generally perceived as cost centres. At the National/regional level, when the LDC were operated
by the CEA, the funding of any capital expenditure and the subsequent Operation & Maintenance
(O&M) used to be from the budgetary support provided by the Central Government. Subsequently in
the TSO structure (CTU operating the RLDCs), the expenditure at the Regional LDCs was recovered
as a part of the tariff of the SCADA/EMS scheme. The situation at the State level was also similar.

The need for financial autonomy of the LDCs became apparent when open access in transmission and
distribution was introduced by the Electricity Act 2003 to promote competition amongst the
7

generating companies over common wires. The market players expressed concerns regarding conflict
of interest between the System Operators on one hand and the generating as well as
transmission/distribution utilities at the other hand. The dependence of LDC either on the Government
or on the bundled utility for resources, was perceived as major bottleneck, in creating a competitive
market through open access. This institutional deficiency was recognized by the ERCs. Therefore, in
the open access regulations, notified by the ERCs, a provision for payment of operating charges by the
open access customer to the respective LDCs was made to provide an incentive to the LDCs to process
requests for open access.
Table 3: Sharing of RLDC fees and charges
Item Total Fees and Charges of RLDC (100%)
Charges System Operation (80%) Market Operation (20%)
Ratio 45% 45% 10% N
Entities
& their
number
Generating
Stations & Sellers
(82)
Distribution
companies &
Buyers (42)
Inter-State
Transmission
Licensees (11)
Users of RLDC services
except transmission
licensees
Sharing
in ratio
of
Installed capacity /
Contracted
Capacity
Sum of allocations
+ contracted
capacity
Total circuit km of
lines owned
Equally

The MoP committee recommended establishment of an independent and reliable revenue streams for
the LDCs. At the Regional level the Central ERC notified the Regulations on the fees and charges of
RLDCs [12] [refer Table-3]. The regulation recognizes human resources expenditure as a separate
head which hitherto was considered as a part of the overall O&M expenditure. This has been done to
emphasize the value of human capital and the fact that the LDCs are knowledge centres. Further a
separate fund has been created by the name of LDC Development fund for loan-repayment, servicing
the capital raised in the form of interest and dividend payment, meeting equity portion in asset
creation, margin money for raising loan from financial institution and for R&D projects.

Few of the SLDCs also have been filing their Annual Revenue Requirements and the same are being
approved by the respective SERCs. The SERCs may consider to align the Regulations for fees and
Charges in line with the CERC Regulations. The Forum of Regulators (FOR) could facilitate this
harmonization process.

The RLDC fees and charge regulation directs the RLDCs to file the CAPEX Plan for next five years
The five RLDCs filed separate petitions for approval of the CAPEX plan and recovery of fees and
charges which have been approved by the CERC in February/March 2011 after extensive debate by
the stakeholders. This has laid the foundation for financial autonomy of LDCs. The challenge is now
to execute the CAPEX plan.

10. ENDNOTES

India is poised to become one of the largest interconnected electricity grids by 2014. By then the
whole country would be one synchronous region. Cross border connections with the neighbouring
South Asian Association for Regional Cooperation (SAARC) countries would also be in operation.
Currently the Bhutan system is synchronously connected with the Indian mainland. Reliable operation
of such a large interconnected grid is a challenge which is possible only with well equipped LDCs.
With the introduction of newer instruments in the electricity market, the LDCs are being entrusted
with additional responsibilities. Moreover, with the introduction of the competitive bidding
mechanism for procurement of power as well as transmission services, need is being felt for an
independent agency for administering the pool funds. The LDCs, as a not-for-profit organizations
perfectly fit in that mould. Further it is hoped that in the future, the discussion in India would shift to
the appropriate model for governance of the LDCs.

The various reports submitted by the MoP committee and subsequent task forces have helped in
8

recognition of the LDC and also suggested mechanisms for institutional capability building in this
area. However there is still a long way to go particularly in view of the logistics constraints for
organizing and administering training and certification of around 2500-3000 System Operators in
India. Recommendations of the various committees and task forces need to be implemented in their
true spirit to realize the dream of a secure economic and effcient reliable power system in India.

11. ACKNOWLEDGEMENTS

The authors would like to thank the esteemed members of the various Committee/Task Force set up by
the MoP for sharing their views on the subject. The authors would also like to thank the officials of
MoP-GoI, CERC, CEA and the management of POWERGRID for their encouragement and
motivation in documenting the development in Indian power sector. The authors would also like to
express gratitude to their colleagues, for their support and cooperation. Special thanks are also due to
the entire fraternity of Power System Operators in India and world.

BIBLIOGRAPHY

[1] Electricity Act, Government of India, June 2003
[2] Human Factors Review of Dispatch Control Centres, Charles J. Frank and Robert J. Miller,
IEEE Transactions on Power Apparatus and Systems, Vol PAS 101, No. 6, June 1982
[3] Improving Human Performance in the Control Centre, G. Krost et.al. WG 39.03, Electra No.
174, October 1997
[4] Impacts Of Operators Selection And Training On Power System Performance, G.Krost et. al.
on behalf Of WG 39.03CIGRE 39-102Session 1998
[5] Operator Performance Requirements And Training Needs In The Commercial Environment,
Steve Allamby et al. on behalf Of WG 39.03, CIGRE 39-104, Session 2000
[6] Transmission System Operators-Lessons from the Frontlines, Beatriz Arizu, William H. Dunn
Jr. and Bernard Tenenbaum, The World Bank Group, June 2002
[7] Interfaces Between System Operators, Market Operators And Other Market Actors, O. Gjerde
et.al. on behalf Of JWG C2/C5-05, Session 2006
[8] Report of the Committee on Manpower, certification and Incentives for System Operation and
Ring-fencing Load Despatch Centres, Ministry of Power, Government of India, August 2008
[9] Report of the Task Force on Capital Expenditure and Issues Related to Emoluments for
Personnel in Load Despatch Centres, March 2009
[10] Report of the Task Force on Manpower Selection, Recruitment Procedure and Tenure for
Personnel in State Load Despatch Centres, June 2009
[11] Report of the Committee for Training & Certification of System Operators, March 2010
[12] Fees and charges of RLDCs and related matters regulation, CERC, 2009.