INDIAN POWER SECTOR

(CHALLENGES AND OPPORTUNITIES)

CONTENTS
INTRODUCTION TO DEMAND & CONSUMPTION

POWER GENERATION, TRANSMISSION AND DISTRIBUTION

AND THEIR RELATED ISSUES
POWER GRID CORPORATION, GRID FAILURE CASE, TARIFF
SYSTEM AND GOVT. ACTS
CAPTIVE POWER PLANT AND RELATED CASE STUDY

KEY DEVELOPMENTS IN POWER SECTOR

OPPORTUNITIES AND FUTURE DEVELOPMENT SCOPE

Introduction

POWER SECTOR IN INDIA AT A GLANCE

58 %

9%

History of Power Sector in India

Demand of power

In India electricity is consumed mainly by industrial, domestic and agriculture

which is 84.61%.
In 2014-15 energy deficit and peak power shortage is 5.1% and 2%
respectively.
Gujarat has the highest surplus with about 1.8 GW power available then its
internal demand.
AVALIBILITY ( MU ) Eastern,
114,677

NorthEastern,
12,248

Southern,
260,366
Northern,
318,837

Western,
289,029

REQUIREMENT ( MU )
Southern,
298,180

Western,
288,062

Eastern, North118,663 Eastern,

14,823

Northern,
328,944

But, still we have less per capita consumption then other

country.

Thermal power

Before we start just an overview of power generation:

https://www.youtube.com/watch?v=pXasvq1ivnw
Possible fuels:
Coal
Natural gas
Petroleum products
Agricultural waste
Domestic trash
Major technologies in deploying thermal power plants are: Steam cycle facilities (large utilities)
Gas turbines
Cogeneration and combined cycle facility
Internal combustion engines
Installed thermal power capacity in India(total as of date 31st october 2012 was 140206.18
MW)
Coal Based Thermal Power- 120103.38 MW (57.38%)
Gas based thermal power - 18903.05 MW (9.03%)
Oil based thermal power 1199.75 MW (0.57%)

Thermal power (India)

Coal: More than 51% of India's commercial energy demand is met through the
country's vast coal reserves.
As on July 31, 2010, and as per the Central Electricity Authority the total
installed capacity of Coal or Lignite based power plants in India are 87,093.38
MW.
57% - coal and lignite accounted of Indias Installed capacity
80% of coal produced is consumed by India
0.7 kg coal per Kwh of coal is consumed in Indian thermal power plants.(0.45
kg / kWh of coal for US)
Difference is due to quality of coal which is measured by Gross Calorific
Value(GCV). Indias GVC is 4500 Kcal/kg
Gas: As on June 30, 2011, and as per the Central Electricity Authority the total
installed capacity of gas based power plants in India is 14,398.57 MW.
This accounts for 10% of the total installed capacity.
GAIL is the main source of fuel for most of these plants. Here is a list of
presently operating plants.

Nuclear Power
Nuclear power is the use of exothermic nuclear
processes to generate useful heat and electricity
(Nuclear fusion, Nuclear Decay & Nuclear fission).
As of 2011 in India: 4.8 GW installed electricity generating capacity.
Nuclear plants generated 32455 million units i.e. 3.75% of
total electricity produced in India.
Nuclear Power Corporation Of India Limited is body which
commercialize the nuclear power.
Nuclear Power Corporation Of India Limited is public
sector enterprise owned by government of India.
Ambition of establishing 63 GW of generating capacity by
2032.

Kundankulam Nuclear Power Plant

Kudankulam Nuclear Power Plant is a nuclear power station in Koodankulam in

the Tirunelveli district of the southern Indian state of Tamil Nadu.
The plant's first reactor is the first Pressurised Water Reactor (PWR) belonging to
the Light Water Reactor (LWR) category in India, and the 21st nuclear power
reactor in the country.
Units operational are 1 x 1000MW
Units under construction are 1 x 1000MW
Nameplate capacity is 9200 MW
Peoples movement against nuclear energy play a pivotal role in the movement by
sentences nuclear plant is unsafe.
In 2012 200 anti nuclear protesters were detained for few hours by police.
In may 2013 the decision was in favour of plant and was stated that it was largely
in favour of public interest.
There were various allegations from Christian organizations and Christian NGOs.
various videos about anti-nuclear was spread by churches at missionary schools.
The prime motive for opposing was that nuclear reactor was allegedly multifaceted

Solar Power Generation

India receives an energy of about 5,000 trillion kWh per year which
is incident over India's land mass with most parts receiving 4-7
kWh per m2 per day.
India plans utility scale solar power generation plants through solar
parks with dedicated infrastructure by state governments, among
others, the governments of Gujarat and Rajasthan.
Charanka Solar Park in Patan, The largest site within the Gujarat
Solar Park is being built on a 2,000-hectare (4,900-acre) plot of
land.
Gujarat Power Corporation Limited is the responsible agency for
developing the solar park of 500 MW and will lease the lands to the
project developers to generate solar power.

Wind Power Generation In India

India has 5th largest installed wind power capacity in world.

In 2010, wind power accounted for 6% of total installed capacity of India and 1.6%
of countrys power output.
First began by Tamil Nadu electric board
Suzlon is leading Indian company in wind power which has installed generation
capacity of 6.2GW in India.
Vestas is another leading company.
As December 2011,
the installed capacity of wind power in India was 15.9 GW.
The largest wind power generating state was Tamil Nadu accounting for 30%
of installed capacity.
Followed in decreasing order by Maharashtra, Gujarat, Karnataka
and Rajasthan .
In Tamil Nadu, wind power is mostly harvested in the Kanyakumari, Tirunelveli
and Tuticorin.
The state of Gujarat is estimated to have the maximum gross wind power
potential in India, with a potential of 10.6 GW

Issues
Thermal power generation: Quality of Coal used in generation
Importing Coal for generation
Coal transportation issues
Gas price sensitivity
Gas supply and Gas regulatory framework

Nuclear power generation: Environmental impact

Radio active waste disposal
High cost of installation

Issues
Wind power generation: Most of wind power farms in India have been reached up to its
commissioned period and requires repowering. (Technical)
Fluctuations in grid frequency and voltage create difficulties in wind
farm operations and reduce the chances for successful wind energy
grid penetration. (Infrastructural)
High borrowing costs in India creates obstacle for wind energy sector
growth.

Solar power generation: Solar power plants normally require 5 acres of land per MW.
Availability of solar radiation is more where water is a scarce
commodity.
CSP plants require high direct solar insolation for its operation.
Normally water availability is a problem in these sites.
For PV power generation, roof tops provide very appropriate space
and sites. Rooftop PV, therefore, is an appropriate proposition.
Development of appropriate coatings that repel dust and moisture is
also a priority.

Power Transmission and Distribution

Challenges in Power Transmission

Project Planning

ISSUES

RECOMMENDATION

Concept to Commissioning
(C2C) time is significantly high
Delay in Commissioning of
Projects Under Cost-Plus
Regime
Sub-optimal planning is
leading to under-utilization of
resources
Lack of targeted planning

Prune the Concept to

Commissioning time to ~40
months
Reduce concentration of projects
with PSUs
Incentivize early commissioning
and speedier execution
Focused planning for short and
medium term transactions
Differentiation between long term
and short/medium term applicants
Use of High Performance
Conductors in Existing & New Lines

for short, medium & long

term transactions
Insufficient focus on up
gradation of existing
transmission lines

Technology and
Innovation

No freedom given to the

developer to innovate

Promote technology & give

freedom to developers to
innovate

Transmission project cycle

The transmission project cycle consists of 5 main phases, as mentioned below.

There are different challenges associated with each phase:
1) Attracting Players
2) Planning & Project Award
3) Project Execution
4) O&M
5) Exit

Other issues
Right of way
Lack of investment
Project execution and completion

Issues of Power distribution

ISSUES

SOLUTIONS

1. Lack of credible information

1. Implementation of comprehensive IT
interface system.

2. Regulatory Framework

2. There is a need to depoliticize the sector to

stop any political intervention in the working
of discoms and the regulator.

3. Better technology for discoms

3. Govt. needs to finance good amount of

funds in this direction rather than focusing the
funds in subsidies and cross subsidies

4. Segregation across business elements

4. There is a need for proper segregation of

Generation, transmission and distribution
sectors for proper energy accounting and loss
calculation

5. Agriculture and rural consumption

segregation

5. The load segregation can be used to

estimate accurate agricultural and rural
consumption in states impacting loss
calculations

Solution of Power Distribution

A step forward towards the PPP model: The govt. must
make way for attracting the private players in the
distribution sector in different forms as Multi Licensing
model, Outsourcing activities,Privatization and
Franchisee models.
After the learnings from Orissa privatization model and
success of Delhi privatization model. Same models can be
replicated in other parts of the country.
Other than privatization model, Franchisee model of PPP
has seen huge success in Bhiwandi and are recently
coming up in some major cities of Agra,Kanpur(by torrent
Power),Nagpur( Spanco) ,Aurangabad.

Delhi Vidyut Board Privatization Case

Issues
Power theft is virtually
institutionalised.
Forty per cent of the AT&C losses
in Delhi are owing to power
pilferage.
Small-scale industries and guesthouses are among the biggest
culprits. Their contribution to the
total power losses is greater than
that of the residents of slum and
unauthorised colonies.

Advantages
AT&C (aggregate technical &
commercial) losses dropped by
75%, from 53.1% to 13.2%.
Average retail tariff rose by 40%.
No of consumers went up by
69.1%.
Distribution Transformation
Capacity in MVA went up by
116%
System reliability went up by
42.7% (from 70% to 99.9%).

Black out in India (2012)

-For two consecutive days millions of people in India suffered from a
crippling power crisis after power grids failed in many parts of the
country.
-It was one the biggest power outages in the last decade that even
brought essential services like the railways and the metro trains to a
grinding halt

Reasons of a grid collapse

Grids collapse due to two basic reasons.
-One is the failure of the equipment, like it happened a decade ago in
2002 when the northern grid collapsed, due to fog/pollution. The
second trigger is power suppliers drawing excessive power from the
grid. Which results in the balance of power generation and supply goes
haywire with a cascading effect.

Power Grid at a Glance

Incorporated in 1989, Started commercial production in 1992,
notified in 1998 as CTU
Single Largest Transmission utility in the world: Carries 50% of
power generated and 1/3rd of the installed power in the country
Recognized as Navaratna by GOI
First utility to get ISO 9001 in the country
First PSU to establish and implement the Environmental and
Social Policy and Procedures (ESPP)
PGCIL S ROLE AND HOW IT CAN PREVENT GRID COLLAPSE

What is Tariff
The money which consumer has to pay to make power available to their homes
Tariffs vary from country to country and locality to locality. It is mainly determined
by the market price of the fuel, types of fuels utilized, government regulations and
subsidies.
CERC(Central Electricity Regulatory Commission) is a key regulator of power sector
in India
Objectives of CERC :
To promote competition, efficiency and economy in bulk power markets
Improve quality of supply
Promote investments
Advise government on removal of institutional barriers to bridge the demandsupply gap
Standard Tariff System
Availability-based tariff
Case Study Analysis: Adani Power (Mundra Project, Tariff Issue)

Laws or Acts

Captive power plant

Captive power in India

-Captive power

plants have been an integral part of industrial

production across the developed and developing world. In many areas
where reliable power is expensive or difficult to access, industry has
taken matters into their own hands and developed power systems to
meet their individual needs.

Role of Captive Power in India

-Captive power has played an increasingly significant role in Indian
industry, both as a back-up source of generation and as the primary
power supply for many industrial facilities.

CPP Case study

To understand it better, we should take case study about Gujarat.
-Gujarat is one of the most highly industrialized of the Indian states and continues to be
the industrial base for chemical, fertilizer, petroleum, textiles and non-ferrous metal
production.
-As a consequence of poor power supply and high tariffs from the SEBs as well as an
encouraging captive power policy by the state government .

-Gujarat has seen a rapid increase in captive power plant capacity, rising from less than 1
GW in 1996 to more than 2.7 GW in 2005.
-Wind plays only a small role in CPP power production, as would be expected with a
small, low PLF fleet of turbines currently in use. Most of the wind projects were done for
the tax benefit to the parent company and had little to do with providing power to the
owners or selling to the grid.
-The overall picture of Gujarat CPP is one of fast growth in a highly industrialised state
with poor service form the SEB and high tariffs.

Key Development in Power Sector

OPPORTUNITIES AND FUTURE SCOPE

1. Strong growth in generation capacity led by
per capita consumption, urbanization
2. Alternate Sources of energy (Renewable)
3. Investment in more Efficient and Clean
Technology