Power Watch India by Amit Deorukhkar

• L&T: SUSTAINABLE SOLUTIONS • PWC: ON T&D •

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Vol 2 Issue 12 February 2012 Rs. 100

Interview with

Olivier Blum

Managing Director – India, Schneider Electric

ENERGY EFFICIENCY FRA MEWORK AND MORE

INTERVIEWS

Vivek Sharma

Director, India Design Centres, STMicroelectronics

Anoop Nanda

MD - SEA, S Asia and Japan, Eaton Power

Christoph Frei

Secretary-General, World Energy Council

Ramesh Chandak President, IEEMA

pwi@nextgenpublishing.net Editor Saptarshi R Dutta Editorial Advisory Board Hoshang S Billimoria Adi Engineer Amulya Charan C A Colaco

peaking recently at the 12th Delhi Sustainable Development Summit, Mr Kandeh Yumkella, Director General of the United Nations Industrial Development Organization (UNIDO)

and Chair of UN-Energy, urged countries across Asia to commit to

Associate Editor Shilpi Aggarwal

achieving sustainable energy for all by the year 2030, by increasing

Features Writer Monica Chaturvedi Charna

access to energy, improving energy efficiency and increasing the use of

Creative Director & Head Production Atul Bandekar Design Shweta Choudhary Illustrator Ajay Paradkar Image Desk Deepak Narkar, Ravi Parmar Publisher Amit Tewari National Product Manager Ashish Damania Circulation Sanjeev Roy Subscription Supervisor Sachin Kelkar

renewables. He said, “Reaching the goal of sustainable energy for all will require action by all countries and all sectors to shape the policy and investment decisions needed for a brighter energy future. Industrialized countries must accelerate the transition to low-emission technologies. Developing countries, many of them growing rapidly and at large scale, have the opportunity to leapfrog conventional energy options and move directly to cleaner energy alternatives that will enhance economic and social development.” Indeed, the world today is grappling with high energy prices, fuel uncertainty and energy poverty. The scenario in India is especially grim. For one of the world’s fastest growing economies, where installed power

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generation capacity has grown 94 times since independence, the peak

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demand shortage hovers around 10.5 per cent with an energy deficit of

Mumbai Leeyen Francis - Regional Manager Trade World, C-Wing, 2nd Floor, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel (W), Mumbai - 400016. Tel: +91-22-67525252

could provide the quickest, cheapest and most direct way to turn these

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8.2 per cent, and is consistently increasing. Demand is likely to increase by 43.7 per cent in 2016-17 as compared to 2011-12. This is where a focused approach to conservation and energy efficiency challenges into real opportunities. Under the aegis of the Bureau of Energy Efficiency, PAT, NMEEE and other mechanisms are being adroitly adopted and encouraged. While the government is doing its bit, the private sector is also pitching in. The focus of this issue is therefore, on energy efficiency – whether in generation, the adoption on newer and better technologies, metering and energy management services. To quote Yumkella, “Reaching the goal of sustainable energy for all will require action by all countries and all sectors to shape the policy and investment decisions needed for a brighter energy future.” Our regular sections follow. Wish you all a happy and informative read.

Saptarshi R Dutta Editor

Editor’s note Editor’s note

PowerWatch

Contents

Page

COVER STORY ENERGY EFFICIENCY

THE INDIAN FRAMEWORK Rapid growth of any economy requires huge quantum of energy resources. India is one of the world’s fastest growing economies having third largest energy consumer accounting (about 5% of the world’s total annual energy consumption). Energy Efficiency could provide the quickest, cheapest and most direct way to turn these challenges into real opportunities.

24 Inside View “Global specialist in energy management” Schneider Electric reaffirms its stand Interview with Energy Efficiency Ambassador, Schneider Electric , Dr Satish Kumar Interview with Vice President, Buildings Business Unit, Schneider Electric, Mr Nikhil Pathak Interview with Managing Director – India, Schneider Electric, Mr Olivier Blum

Verification Services in India Underwriters Laboratories has set up its state-of-the-art laboratory in Manesar that will provide energy efficiency and performance testing for a host of lighting products, home appliances and electrical equipment...

58 Tech’tonic

Interview with Vice-President and MD, UL Emerging Markets , Mr R A Venkitachalam

Impact of High Pressure and Intermediate Pressure Turbine Configuration on large fossil steam turbine performance

Interview with Managing Director, SEA, S Asia and Japan, Eaton Power, Mr Anoop Nanda

46 Regulatory Watch The Findings of Shunglu Report on Power Discoms

L&T commits to go green A Case for Distribution Franchisee Cutting-edge design ensures smarter systems Starting with just four employees in 1987, STMicroelectronics’ operations in India have come a long way, evolving into an organization with close to 2,300 employees, all of whom contribute to ST’s worldwide success. Interview with Director, India Design Centres, STMicroelectronics Pvt Limited, Mr Vivek Sharma A New High for Testing and Cover Image courtesy: Getty Images

Interview with Executive Director, PricewaterhouseCoopers, Mr Sambitosh Mohapatra

54 Money Matters French betting big on India’s Solar Potential Indian subsidiary of French major, Solairedirect plans to invest Rs 4,000 crore to become 400 MW company in next 5 years... Interview with MD, Solairedirect Energy, Mr Gaurav Sood

How to select right OEM contractor Flexible operation and maintenance contracts are an effective solution for optimum asset management of combined cycle facilities...

Technology Edge Through its joint venture with the world’s leading energy and telecom cables’ company, the Prysmian Group, Ravin Cables has committed to bringing the best technology and product solutions to India… Interview with Chairman and Managing Director of Ravin Cables Limited, Mr Vijay Karia

Regulars Dispatches National...................................08 International...........................14 Finance.....................................16 Events.......................................68 Vital Stats................................76

Tough demands have met their match.

:LWK D K\GUDXOLF GULYH V\VWHP IURP +lJJOXQGV \RX JHW FRPSDFW GXUDEOH SRZHU ZLWKRXW IRXQGDWLRQV RU JHDUER[ $ IXOO UDQJH RI UXJJHG PRWRU W\SHV DQG FRP SOHWH VROXWLRQV IRU PRQLWRULQJ DQG FRQWURO JLYH \RX WRWDO DVVXUDQFH HYHQ LQ WKH PRVW GHPDQGLQJ DSSOLFDWLRQV VXFK DV EHOW FRQYH\RUV Let us know your demands. HÃ¤gglunds Drives (India) Pvt. Ltd. 18/4 & 19/4 Hadapsar Industrial Estate, Pune â&#x20AC;&#x201C; 411 013, India Tel. + 91 20 26813841/26813842, Fax: + 91 20 26813844 E-Mail: info@in.hagglunds.com, www.hagglunds.com

Our drive is your performance.

Dispatches National

Essar Oil successfully commissions Amine Regeneration Unit Essar Oil Ltd. has announced the successful commissioning of the Amine Regeneration Unit (ARU), a part of the phase I expansion at its Vadinar Refinery. Once completed, the phase I expansion will increase the refinery’s capacity from the current 14 MMTPA (300,000 bpd) to 18 MMTPA (375,000 bpd). The expansion will also increase in its complexity from 6.1 to 11.8. The project is nearing completion and the increased throughput of 18 MMTPA will commence by March 2012. Furthermore, an optimisation project is also under execution at the refinery to increase the capacity to 20 MMTPA (405,000 bpd) by September 2012. The capacity expansion, complexity enhancement and subsequent optimisation will give Vadinar refinery the capability to process nearly 87 percent ultraheavy crudes, which have a lower cost than light crudes. In terms of product yield, the expanded Vadinar Refinery will have the flexibility to produce higher value products, including pet coke. “After the commissioning of the Isomerization Unit last month, the refinery team is working towards ensuring the commissioning of all the remaining units that form a part of our phase I expansion. The ARU commissioning is one more step in that direction and will be followed by all the balance expansion units being commissioned in the current quarter,” said Lalit Gupta, MD and CEO, Essar Oil.

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Kochi-based IT firm to support CPECC’s global expansion strategy China Petroleum Engineering and Construction Corporation (CPECC) has chosen Kochi-based WRENCH™ Solutions to facilitate smooth execution of its projects outside China and to optimize work between its local manpower resources and other overseas offices in the Middle East and North Africa region. WRENCH™ is a web-based project control platform that will bring together all of CPECC offices and enable teams to collaborate online. In addition, project members and stakeholders will be able to share, update, review and archive information (including engineering data and correspondence) in real time. Quality will also be driven by the system itself rather than manual checks and monitoring. According to Mr Manesh Alias, Head of Projects, WRENCH™ Solutions, “This will help ensure the trust among CPECC project stakeholders (and even internally amongst multi-location teams) and reassure its clients of a foolproof online system to manage project data, processes and schedules in this highly competitive global economy. This should resolve any concerns CPECC’s clients might have had with respect to delegating work to its teams in China - which in turn will help CPECC to greatly reduce manpower costs”.

February 2012

Suzlon to invest Rs 18,000 crore in Andhra Pradesh Wind turbine maker, Suzlon has signed a pact with the Andhra Pradesh government for investing Rs. 18,000 crore to develop wind power projects in the state by 2016. The company inked a Memorandum of Understanding (MoU) with the state government for the development of wind capacity in the state totaling 3,000 MW between 2012 and 2016, that would create potential investments of up to Rs 18,000 crore. According to the MoU, the state government will facilitate Suzlon in obtaining necessary permissions, registrations, approvals and clearances for the development of the wind farms. Suzlon, in turn, will play the

role of a developer and facilitate the channelisation of investments into the state through its customers investing in wind energy. “We are extremely pleased to sign this MoU with the Government of Andhra Pradesh. It illustrates their commitment to power a low-carbon economy by embracing progressive policies to power rapidly growing economy of the state,” Mr. Tulsi Tanti, Suzlon group Chairman was quoted as saying. The agreement covers the development of new capacity in wind farms across the state, with development planned in the districts of Tallimadugula, Alankarayanipeta, Gandikota, Vajrakarur, Tirumalayapalli and other parts of Andhra Pradesh.

Dispatches National GoI to set up Smart Meter Task Force Mr. Sam Pitroda, Advisor to the Prime Minister, Government of India and Chairman, Indian Smart Grid Task Force, revealed at the inaugural session of GridWeek Asia 2012 that the government is planning to set up ‘Smart Meter Task Force’ that will look into modernizing primitive ways of calculating power usage. “It is amazing to see how India, which is a super power in information technology, lags terribly in the power sector. It is really annoying to see our primitive ways of providing power

– be it evacuation, grids, meters or even the way we manually calculate power consumption till date. All this has to change and it will change, for this decade has been declared by the government as the ‘Decade of Innovation’,” said Mr. Pitroda. According to him, the government has set up US $ 1 billion venture fund to foster ‘innovation’ across sectors and states. “We have set up a National Innovation Center that will oversee state innovation centers and 100 sectoral innovation

Fluke Corporation acquires TTL Technologies US-based Fluke Corporation, a global leader in portable electronic test and measurement technology, has acquired TTL Technologies Private Ltd. for an undisclosed amount. TTL has represented Fluke in India since 2001 as a master distributor and is spread across various regions in the country. The new business combines TTL’s many years of experience in the Indian test and measurement market, its national distribution network, customer care and accredited calibration labs with Fluke technological innovation, manufacturing excellence and business processes. Post acquisition, TTL businesses and employees will be integrated into the Fluke organization. “We are excited to welcome TTL to the Fluke family. TTL has been a great partner and now together we will substantially increase our overall customer offering. This agreement reinforces our commitment to our customers in India and positions us for rapid growth in an important market,” said Mr. Peter Van Den Broek, President Emerging Markets, Fluke Corporation. Protests by coal consumers against government’s move to switch to a new pricing methodology has led Coal India Limited (CIL) to roll back price hike under the Gross Calorific Value (GCV)based system effective from January 1, 2012. Coal Minister, Sriprakash Jaiswal reportedly termed CIL’s decision to raise rates an ‘error’.

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February 2012

houses. All these efforts beautifully tie-up into the Smart Grids. Today, I personally think that power is our biggest bottleneck for 8 percent GDP growth. It is a larger challenge that many of us don’t realize considering that power has to reach to the bottom of the pyramid and that too cheap power. Only Smart Grids – that too India specific model of Smart Grids – can solve our problems. The western model is not scalable, affordable and workable,” he added.

CLP India inks 100.8 MW wind power project with Suzlon CLP India, a wholly owned subsidiary of the CLP Group and Suzlon Energy Limited (SEL) have signed a contract for over 100 MW of wind power project, which is expected to be commissioned by January 2013. The project comprises 48 units of Suzlon’s latest S97-2.1 MW wind turbine featuring DFIG technology and is expected to generate more than 0.2 million CERs every year, upon registration under the Clean Development

The Tamil Nadu Electricity Regulatory Commission (TNERC) has accepted debt-ridden Tamil Nadu Electricity Board (TNEB’s) proposal to revise tariff for domestic and commercial purpose. Domestic consumers who have been paying bi-monthly for 51-100 units will be paying 150 paise/unit compared to 75 paise/unit, a hike of nearly 40 per cent.

Mechanism. “This order from CLP India reflects the trust instilled in Suzlon and our latest S9X turbines by a globally renowned utility IPP. We have proven endto-end capabilities in India, including low cost manufacturing set-up, as well as a strong pipeline of projects in all windy states and the proven expertise of setting-up and operating over 6,800 MW of wind energy assets,” said Mr. Tulsi Tanti, Chairman, Suzlon Group.

Gujarat Electricity Regulatory Commission (GERC) has decided to increase power tariff for consumers of state utilities and private power companies. The hike ranges between 2.63-4.68 per cent for different segment of consumers. GERC has allowed an average tariff hike of 13 paise/unit or 4.05 per cent of the existing tariff for four state-owned power distribution companies.

Dispatches National

Tata Steel secures multi-million pound order from Siemens Tata Steel has bagged a multi-million pound order from engineering giant, Siemens Wind Power for supplying of 25,000 tonnes of high quality profiled steel plate for 150 wind turbine towers. The order from Siemens comes at a time when Europe’s steel industry is struggling to cope with low demand amid economic uncertainty in the euro zone. Tata Steel Europe, in particular, has been hit severely by the crisis, with its gross earnings (EBITDA) falling by 42.8 per cent to $103 million in the June-September quarter of 2011. The order is the largest so far for its dedicated wind tower site in Scunthorpe, UK, which was established in 2010. The plant can deliver up to 2,00,000 tonnes of steel plates annually. It is informed that Tata Steel has already supplied Siemens Wind Power with 6,000 tonnes of steel plate for similar developments in the UK and Europe. “Demand for steel in the renewable energy sector will continue to grow and we are ideally placed to help our customers tap into this important opportunity,” Mr. Phil Knowles, Tata Steel Commercial Manager for power generation was quoted as saying.

R-Infra infuses Rs 520 crore in Delhi’s BSES business Reliance Infrastructure Limited has infused Rs 520 crore equity into BSES Delhi distribution companies as part of Rs 5,100 crore financial package being worked by IDBI bank. The package required the promoters to bring in 20 per cent equity or Rs 1,020 crore. It is to be noted that Delhi government will infuse another Rs 500 crore into the distribution companies. Discussions with IDBI bank are at an advanced stage and are expected to conclude soon. Completion of this process will help arrange long-term debt to finance the cash-flow mismatch and enable BSES Delhi to facilitate its payments to generation and transmission companies, it said. According to Reliance Infrastructure CEO, Mr. Lalit Jalan, efforts were being made to ensure quick payments to generation and transmission companies. “Over last 9 years, the power purchase cost for Delhi discoms has increased by 280 per cent whereas during the same time, the consumer tariff has only increased by 36 per cent. Due to this huge discrepancy between cost increases and revenue, there is a current revenue deficit of nearly Rs 2 per unit, resulting in under-recoveries of Rs 20 crores per day for the three Delhi discoms,” Mr. Jalan reportedly said.

NTPC bags $1.5 billion power project in Bangladesh Bangladesh has signed a US $1.5 billion deal with state run National Thermal Power Corporation (NTPC) to build a 1,320 MW coal-fired power plant to help ease acute power shortages. Bangladesh’s state-owned Power Development Board (PDB) struck the 50:50 joint venture deal and PDB Chairman, Mr. A. S. M. Alamgir Kabir and NTPC Chairman, Mr. Arup Roy Chowdhury inked the agreement. Under the pact, a JV company will be floated to install and operate the plant while PDB State-run electrical equipment maker, BHEL is looking at South Africa for its circulating fluidized bed combustion (CFBC) boilers, needed for power and industrial applications. The company is open to joint ventures for this purpose. “South African coal is similar to what is available here and hence we are looking at that market for our CFBC boilers,” A.V. Krishnan, executive director, BHEL’s boilers division reportedly said.

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and NTPC will implement the US $ 1.5 billion project. The plant will be set up at Bagerhat’s Rampal, and Bangladesh and India will have equal partnership in production. Of the total project cost, 70 per cent will be arranged through loans and the rest will be equally shared between the JV partners. India’s power secretary It is informed that the cost of per unit electricity will vary from Taka 5 to Taka 7, if existing international market price of coal is taken into account. The ADAG-led Reliance Power has entered into an agreement with Germany’s RWE Power International for technical assistance in extracting coal from its captive mines of the Tilaiya UMPP in Jharkhand. RWE will assist the company in designing and planning engineering aspects for its captive mine and will also help in acquiring equipment.

February 2012

plant is expected to be commissioned by 2015. “We expect that the most modern and new technology would be used in setting up the JV power plant that would help Bangladesh minimise its growing need of electricity,” Bangladesh’s Finance Minister A M A Muhith reportedly said. “Coal will be imported to run the plant from Indonesia, Australia and South Africa to run the plant. We’ll use local coal if we get supply as per the demand of the plant,” Mr. Kabir was quoted as saying. Jharkhand has decided to depute Power Grid Corporation of India Limited (PGCIL) as consultant to carry out the electricity transmission work in the state. With expertise in establishing transmission lines, PGCIL would be paid 11 per cent as supervision and consultancy charges for the purpose. The company would invite tenders in transparent manner to facilitate the project in the state worth Rs 1,416 crore.

Moser Baer adopts new tech for PV cell efficiency Moser Baer Photo Voltaic Limited, the PV arm of Moser Baer, has adopted the metal and intrinsic layer semiconductor technology (MIST) to upgrade its photovoltaic cell efficiency to 21 per cent for meeting industry challenges. The new technology will help the company in achieving global competitiveness and provide long-term sustainability to the business. “MIST technology will help

manufacture high efficiency product and bring direct benefit to the customers as it will use less of land area and lower balance of systems costs,” Mr. Rajiv Arya, Moser Baer PV Chief Executive reportedly said. “There was a need for a comprehensive policy support in order to create a healthy, robust manufacturing ecosystem in the country, he said. Things need to be looked at holistically. Only

technological intervention will not help address the industry issues,” he added. In challenging times of oversupply of PV modules, rapidly declining prices and stiff competition from foreign players, the adoption of new technology will help the company in leveraging its strong research and development and execution capabilities across multiple technologies, it is believed.

ONGC and Cairn commence oil production in Bhagyam field

KEC International bags orders worth 371 crore

ONGC and Cairn (Rajasthan JV) has commenced production from the Bhagyam field, which is the second largest of 25 discoveries made by Cairn in the Barmer Basin in Block RJ-ON-90/1. The commissioning is being seen as a key milestone towards achieving the target production rate of 175,000 bopd by end of 2011-12. The Mangala, Bhagyam and Aishwariya (MBA) fields have gross recoverable oil reserves and resources of approximately one billion barrels. The Rajasthan joint venture will contribute more than 20 per cent of current domestic crude production when they reach the currently approved plateau rate of 175,000 bopd. The Bhagyam reservoir and facilities will entail a gradual and safe ramp up to reach the currently approved plateau rate of 40,000 barrels of oil per day (bopd). “Our joint venture is well placed to further increase production from Rajasthan. Beginning of oil production from Bhagyam field is a significant step towards further development of the MBA fields. This underlines our continued commitment to the optimal development of the Barmer basin in Rajasthan and determination to create value for the people of Rajasthan as well as the country,” Mr. Sudhir Vasudeva, CMD, ONGC said.

Global infrastructure EPC major, KEC International Limited has secured two orders worth Rs 371 crore for the construction of transmission lines in India. The first order valued at Rs. 258 crore comes from Power Grid Corporation of India Limited (PGCIL), for the supply and construction of 400 kV double circuit transmission line from Bhachau in Kutch to Essar thermal power station in Gujarat. The total length of the line is 260 Kms and the contractual completion time is approximately 26 months. The second order valued at Rs. 113 crore has been received from Haldia Energy Limited, a subsidiary of Calcutta Electric Supply Corporation (CESC) Limited. It covers supply and construction of 400 kV double circuit river crossing transmission line between Haldia Thermal Power Plant and Subhash Gram, crossing the Ganges River at Kolkata. The contractual completion time for the project is approximately 18 months. “The last few months have been very good for KEC in terms of securing new orders. We have continuously secured orders from across the globe and across our various businesses. The Haldia Energy Ltd. (CESC) order is the second successive order from the domestic private sector customer in the last two weeks.

STMicroelectronics unveils first car-door controller IC STMicroelectronics, a global semiconductor leader and supplier of car-door electronics has introduced the market’s first multifunctional door-zone driver with an integrated electric-window control. This innovative chip reduces the bill-of-material costs and offers new levels of passenger comfort. It has already been selected for broad adoption at a leading German car manufacturer. ST’s newest door actuator driver removes the need for mechanical relays in car-window control, currently being used by equipment manufacturers to drive the electric-window motors. February 2012

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Dispatches International

India offers assistance to Mauritius in tapping renewable energy

NEWS BRIEF Undeterred by the economic crisis in Greece, Solar expert, Conergy Greece has completed another 1 MW solar park called Volos in the north of Greece. The park is located in the industrial area of the city. “Greece’s ongoing financial problems do not affect Conergy’s commitment in the country’s solar market. The country benefits from very high irradiation levels and its renewable energy market is an important pillar for Greece’s economy,” Conergy Greece boss Stefanos Melissopoulos reportedly said. Breezer International, a service company in the petroleum downstream sector has introduced two new petroleum products, Power Super and Power Diesel in the Ghanaian market. The new products are expected to enhance the efficiency and performance of vehicle engines and also help improve the optimum performance of vehicles. It also allows motorists to cover more distance per litre and enjoy longer, effective use of their vehicle engines. ET Solar Group has entered into a 6 MW PV module supply agreement with LARIVIERE, a distributor of roofing products in France. These modules will be used on various residential, commercial and agriculture green house rooftops in France. “We are very pleased with our business relationship with a strong industry participant like LARIVIERE,” Dennis She, President and CEO, ET Solar reportedly said.

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India has offered help to Mauritius in developing its renewable energy sector. During his recent visit to Mauritius, the Minister of New and Renewable Energy, Dr. Farooq Abdullah called on the Prime Minister of Mauritius, Dr. Navinchandra Ramgoolam and had bilateral meetings with Deputy Prime Minister and Minister of Energy, Dr. Ahmed Rashid Beebeejaun, apart from other ministers of the island nation. Mauritius. Dr. Abdullah offered assistance to Mauritius in tapping its renewable energy resources including wind, solar and geo-thermal.

He also extended help to scale up Indian initiatives in capacity building and support in design and policy framework for renewable energy initiative in that country. Furthermore, he made a special reference to the traditional and warm ties between the two countries and of the multicultural and diverse society that had been created as a result of emigration of hundreds of thousands of Indians to Mauritius. The Mauritian side thanked India for its support in imparting training to their scientists and technicians in solar and wind energy. Dr.

Abdullah later visited Sir Seewoosagur Ramgoolam Botanical Garden at Port Louis, where he laid a wreath on the Samadhi of the ‘Father of the Nation’ and first Prime Minister of Mauritius, Shri Seewoosagur Ramgoolam. He also visited the Apravassi Ghat, which now is a UNESCO world heritage site, and was the first point of landing for the indentured labourers who left India to work in Mauritius.

CG powers E.ON’s Humber Gateway Offshore Wind Farm Crompton Greaves (CG), part of the US $ 4 bn Avantha Group has been awarded a contract for the design, engineering, supply and installation of the onshore and offshore substations at the 219 MW Humber Gateway offshore wind farm in the UK. Humber Gateway is a round 2 offshore wind project owned by Germany based investor-owned energy service provider, E.ON. The scheme is based on 73 multi MW turbines, power from which will be collected and delivered to the 280 MVA offshore substation platform. It will be transformed up to 132 kV and delivered onshore through two export cables to a new national grid substation, February 2012

30 km inland at Hedon in the northeast of England. “The UK will see 18 GW of offshore wind installed by 2020 and this first win provides CG a launchpad to secure a strong market share in this strategic sector and contribute to the UK’s 2020 green energy targets”, stated Laurent Demortier, CEO and MD of CG. The company’s scope in the multi-million pound contract includes detailed electrical system design with grid code compliance, supply of a high voltage offshore substation, consisting of two step up power transformers, medium voltage and high voltage GIS installed by E.ON on a single jacket foundation and a 132/275 kV onshore substation works.

BOC joins Alstom, Drax in flagship CCS project Britain based multinational industrial gas company, BOC is joining Alstom and Drax as a co-developer on the 426 MW oxy-fired carbon capture and storage (CCS). The project is currently under development at the Drax site in North Yorkshire. BOC was selected following a competitive process and brings world-leading technology in the field of air separation, as well as complementary plant engineering and integration capabilities from its parent, The Linde Group that will further enhance the deliverability of the project. “We are delighted to welcome BOC to the project development team and are confident that the combination of major industrial players now assembled has what’s needed to take CCS from pilot scale to full-scale

operation, in what promises to be a flagship project for the UK, Europe and beyond,” Mr. Mike Huggon, MD, BOC reportedly said. “We are excited to be joining this key project at such a critical time for clean energy technologies and look forward to seeing the benefits to the environment and UK economy that CCS will bring,” Mr. Stephen Burgin, Alstom’s UK Country President and Mr. Peter Emery, Drax’s Production Director were quoted as jointly saying. The project will link into the Humber Cluster CO2 transport and off-shore storage network currently under development by National Grid. The key partners in this industry initiative represent Europe’s strongest-ever industrial alliance to fast-track the commercialisation of CCS technologies.

GE ventures into Kenya’s wind market G E’s power generating subsidiary, GE Energy is planning to set up a 100 MW wind farm in Ngong, showing growing international interest in Kenya’s lucrative electricity sector. The power plant is expected two be in operation in two years. It is reported that GE will fund the power plant whose construction is ongoing, making Kipeto Energy project one of the single largest foreign direct investment in the energy sector. It is estimated that the project will cost the New York-listed company over $ 300 million, and will also enable GE to tap into the carbon trading from the generation of clean energy. The entry of Kipeto Energy, the third largest wind plant after Lake Turkana and Aeolus (Kinangop and Ngong). Mr. Kaburu Mwirichia, Chief Executive at the Energy Regulatory Commission, reportedly said that he was aware of GE establishing a wind power plant and was expecting an application for approval of the power purchase tariff.

SCHOTT to discontinue wafer manufacturing at German facility SCHOTT Solar AG, an international supplier of highperformance solar modules and key components of of photovoltaic (PV) systems is planning to discontinue wafer manufacturing at its facility in Jena, Germany. The move will conclude the company’s restructuring efforts and is expected to affect 290 employees. SCHOTT reportedly stated that developments in the global solar industry, including overcapacities and severe price declines for wafers and cells, have

made the termination of wafer production necessary. The company will open a technology center for monocrystalline wafers at the site in Jena, and will continue manufacturing thin-film solar PV modules at the site as well. “We will no longer be pursuing upstream stages of the value creation chain that only generate losses. Instead, we will be concentrating on the fast-growing module and project business,” Dr. Martin Heming, SCHOTT Solar AG CEO was quoted as saying. “With the help of this new

strategy, outstanding products and the strong SCHOTT Solar brand, we are in an excellent position to operate successfully in the difficult solar market,” he added. Post this decision, SCHOTT is evaluating the prospects of offering further employment for the affected employees in other areas of the company. The company also stated that it is engaged in an intensive dialogue with social partners to come up with solutions other than dismissing staff for operational reasons.

SCHOTT also notes that it will launch its new SCHOTT PERFORM MONO highperformance PV module in the first half of 2012, and that it is engaged in successful joint research efforts on various technologies aimed at making solar energy more powerful while lowering prices.

February 2012

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Dispatches Finance National IFC invests $5 million in Mahindra Solar One International Finance Corporation (IFC), a member of the World Bank is providing $5 million in debt financing to Mahindra Solar One, a joint venture between Mahindra Group and Kiran Energy for a 5 MW solar power project in Rajasthan. The project is aimed at expanding access to clean energy in rural areas and address the issue of climate change. The new solar PV power plant will generate enough electricity to serve about 60,000 rural homes and is expected to avoid some 8,000 tons of greenhouse gas emissions. Mahindra Solar One planned the project as part of the Jawaharlal Nehru National Solar Mission ( JNNSM), a government initiative to expand solar production in India by 1,100 MW over the next two years. “The project is aligned with our strategy of promoting clean growth in the region, and also complements our knowledge partnership with the government of Rajasthan. IFC’s strategy in the solar sector is to increase energy access in emerging markets by investing in technology and scaling new business models, reducing costs so that more people use solar power,” said Ms. Anita George, IFC Director for Infrastructure in Asia. The Rajasthan plant is expected to generate about 9 million kilowatt-hours annually to help electrify rural parts of the country. Last year, IFC’s Advisory Services team had hosted a conference, ‘Rajasthan as a solar component manufacturing hub’, to help investors and solar energy producers recognize the states’ potential as a hub for generating solar energy.

ONGC celebrates strong financial growth State owned Oil and Natural Gas Corporation Limited (ONGC) recently presented interim dividend of Rs. 3964.35 crore to the government of India (GoI). At the presentation ceremony held in New Delhi on January 10, 2011, Mr. Sudhir Vasudeva, CMD, ONGC presented a cheque of the same amount to Minister of Petroleum and Natural Gas, Mr. Jaipal Reddy. The amount enriches shareholders as part of ONGC’s interim dividend of 5347.20 crore that ONGC had announced post its 226th board meeting held on January 4, 2012. This dividend payout comes on the back of strong financial performance of the company in the first half of the financial year 2011-12. The payout works out to Rs 6.25/- per equity share of 5 each (on 8,555,490,120 equity shares). The year has been a remarkable period for ONGC during which the exploration and production (E&P) major made a total of 15 notified discoveries of hydrocarbon blocks reinforcing its stature as the flagship oil and gas company of the country.

NTPC Q3 income grows by 14.68% National Thermal Power Corporation (NTPC) has recorded an unaudited total income of Rs. 16,245.42 crore for Q3, against Rs. 14,165.33 crore in the corresponding period previous year. The power generating company, having an installed capacity of 36,014 MW registered an increase of 14.68 percent for the quarter ended December 2011. For the nine-month period from April-December 2011, the unaudited total income was Rs. 47,800.18 crore as against Rs. 43,057.43 crore previous year. The company has declared an unaudited PAT of Rs. 2,130.39 crore for Q3 as compared to Rs. 2,371.48 crore declared in the corresponding quarter in previous year. The PAT for the nine-month period ended 31st December 2011 is Rs. 6,630.29 crore, against Rs. 6,320.75 crore for the corresponding ninemonth of previous year. Following the results, the board of directors have recommended an interim dividend for the year 2011-12 at 35 percent of paid up equity share capital being Rs. 3.50 per equity share.

PFS records total revenue of Rs 94.07 crores in Q3 FY12 PTC India Financial Services Limited (PFS) has recorded total revenue of Rs. 94.07 crore in Q3 FY12, compared to Rs. 28.94 crore in the same quarter previous year. PAT increased to Rs. 57.90 crore from Rs. 5.71 crore in Q3 FY11. The Indian non-banking finance company institution recorded nil NPAs as on December 31, 2011 and 3.19 per cent return on assets (ROA) for Q3 FY12. The Net Interest Margin (NIM) stood at 8.12 per cent and

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February 2012

spread at 4.62 compared to 6.85 per cent and 5.24 per cent respectively in Q3 FY11. One of the reasons for higher NIM is utilization of IPO proceeds before resorting to borrowing for financing activities. Net Interest Income considered for NIM and spread does not include interest income of Rs. 4.73 crore on treasury float on temporary surplus funds, included in other income of Rs. 4.82 crore for Q3 FY12.

Dispatches Finance International

Vestas China receives first V100 turbine order Vestas China has received its first V100 turbine order from Datang Hubei Renewable Energy in China. The order represents not only an important step further into the low wind regime in the country, but also a step into the new geographical market of the Hubei province. The 27 units of V100-1.8 MW turbines with a total capacity of 48.6 MW will be installed in the Long Ganhu wind farm in the Hubei province, a low-wind site with an average wind speed at 5 m/s. Compared to other wind power plants in China, the Long Ganhu site is situated close to one of the intensively energy consuming areas of Hubei province. The

contract includes delivery, transportation, installation supervision and commissioning of the wind turbines, a VestasOnline® Business SCADA solution as well as a twoyear service and maintenance agreement. The first turbines are scheduled to be delivered in the second quarter of 2012. “The low-wind sites in China is a new market of huge potential, but a new market also implies new challenges for wind power developers. It is therefore important to choose a proven and reliable technical platform and wellrecognized business partners. Datang Renewable’s selection of Vestas for low-wind sites is the best recognition of

our long-term cooperation. The contract is of great significance to us; it not only helps us open up a new market, but also firms our steps towards the exploitation of the dominant wind regime in China,” Jens Tommerup, President of Vestas China reportedly said. The V100 turbine is especially developed for low wind sites and designed on the proven 2 MW platform. With gradually fewer high wind sites to be exploited globally, low-wind sites are attracting the focus of the wind power developers.

ABB wins $250 million power orders in Saudi Arabia Electrical engineering company, ABB Limited has won orders worth more than $250 million from the Saudi Electricity Company to construct new substations and reinforce existing ones in the country to address its growing demand for electricity. The orders were booked in the fourth quarter of 2011. One of the new gas-insulated switchgear (GIS) substations will be located south-west of Al-Hassa in the eastern region of Saudi Arabia. It will facilitate the transmission of an additional 2,000 MW of electricity from a new gas-fired power plant being built next to Saudi Electricity Company’s existing Qurayyah power station. As per the order, six other new distribution substations and the three to be upgraded will be located in the capital Riyadh and other cities in the central region. “The substations will enhance transmission and distribution capacity to help meet the growing need for electricity,” said Peter Leupp, head, ABB’s Power Systems division.

Gamesa and NREL collaborate on next-gen wind turbines

Siemens to supply 100 MW of wind turbines to Morocco

Spanish wind turbine manufacturer, Gamesa and the National Renewable Energy Laboratory (NREL) are collaborating on next generation wind turbines for the US market. The publicprivate partnership will collaborate on developing new wind turbine components and rotors for the US market, researching and testing the performance of new control strategies and devising models that will help advance the development of offshore wind in US coastal waters. Gamesa has already installed and commissioned a G97 Class IIIA 2.0 MW test wind turbine at NREL’s National Wind Technology Center near Boulder, Colorado. The wind turbine will serve as the test platform with NREL, and is designed specifically for low-wind sites.

Having secured its first wind turbine orders in Africa, Siemens Energy is all set to supply 100 MW of wind turbines to Casablanca based, Nareva Holding for the Haouma and Foum El Oued wind power plants in Morocco. Both wind farms are expected to commence commercial operation by the summer of 2013. The Haouma wind farm project will be built in Northern Morocco, approximately 30 km east of Tangier, and 6 km south of the Mediterranean coast. At 50 MW, Haouma will feature 22 Siemens SWT2.3-93 wind turbines.

February 2012

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PowerWatch INDIA

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COVER STORY

t the recent Delhi Sustainable Development Summit, Mr Kandeh Yumkella, Director-General of the United Nations Industrial Development Organization (UNIDO) and Chair of UN Energy, said, “Reaching the goal of sustainable energy for all will require action by all countries and all sectors to shape the policy and investment decisions needed for a brighter energy future. Industrialized countries must accelerate the transition to low-emission technologies. Developing countries, many of them growing rapidly and at large scale, have the opportunity to leapfrog conventional energy options

and move directly to cleaner energy alternatives that will enhance economic and social development.” Today, the world is facing high energy prices, threat towards energy security and energy poverty as well as increasing concerns towards climate change. For the year 2010-35, the world’s energy demand would increase by 1/3, because of the following main factors: Increase in global population by 1.7 billion, and High Annual GDP growth of 3.5% globally (Source IEA) Energy Efficiency could provide the quickest, cheapest and most direct

way to turn these challenges into real opportunities. Rapid growth of any economy requires huge quantum of energy resources. India is one of the world’s fastest growing economies having third largest energy consumer accounting (about 5% of the world’s total annual energy consumption). Projected GDP growth in India stands at 9% giving boost to further industrial development and improvement of the well-being of the nation. To meet increasing energy demand in the country installed capacities are expected to grow at 7% annually. The installed power generation capacity in India has grown 94 times since independence and the total installed

The Indian Framework

Energy

Efficiency

Rapid growth of any economy requires huge quantum of energy resources. India is one of the world’s fastest growing economies having third largest energy consumer accounting (about 5% of the world’s total annual energy consumption). Energy Efficiency could provide the quickest, cheapest and most direct way to turn these challenges into real opportunities.

capacity of power generation in India has reached 182,345 MW (as on 30.09.2011). There is a peak demand shortage of around 10.5% and an energy deficit of 8.2% in the country and is consistently increasing. As per the 17th Electrical Power Survey (EPS) of the Central Electricity Authority, the electricity demand is likely to increase by 39.7% in 2011-12 as compared to 2006-07 and by 43.7% in 2016-17 as compared to 2011-12. The historic trends in energy, electricity and CO2 intensities of India indicate an overall decline over a period of time. The decrease in Indiaâ&#x20AC;&#x2122;s energy intensity can be attributed to â&#x20AC;&#x201C; the interventions by the Government of India for promoting energy efficiency quest for global competitiveness; and the increasing share of the lower energy-intensive services sector in the Indian economy. Given the current scenario of energy constraints in India, sustainable development of the policy initiatives is an essential part of overall societal development.

LEGAL FRAMEWORK FOR ENERGY EFFICIENCY In India, energy efficiency related programs have been initiated by the Government

of India (GoI) through various laws and regulations. These laws and regulations have been gradually introduced in the last 20 years. Energy Conservation Act, 2001 In order to institutionalize energy conservation efforts in the country, the Government of India enacted Energy Conservation (EC) Act in 2001, and established the Bureau of Energy Efficiency (BEE), under Ministry of Power, Government of India, on 1st March 2002 to promote the efficient use of energy and its conservation. BEE is the nodal agency to promote energy efficiency initiatives in the country and has laid down a targeted national action plan in this regard. Integrated Energy Policy (IEP), 2005 Integrated Energy Policy (IEP), as developed by the Planning Commission in 2006, is a crucial policy document, which is seen as guiding the medium to long term policy decisions of the government in the energy sector. The broad vision behind the energy policy is to reliably meet the demand for energy services of all sectors including the lifeline energy needs of vulnerable households, in all parts of the country, with safe and convenient energy at the least cost in a technically efficient, economically viable and environmentally sustainable manner. Assured supply of

The energy consumption share of different sectors, 2010-11

such energy and technologies at all times considering the shocks and disruption that can be reasonably expected is essential to providing energy security to all. Currently, India consumes 0.19 kilogram of oil equivalent per dollar of GDP expressed in purchasing power parity terms. However, there are several countries in Europe at or below 0.12 with Brazil at 0.14 and Japan at 0.15. Thus, clearly there is room to improve and energy intensity can be brought down significantly in India with current commercially available technologies.

NATIONAL MISSION FOR ENHANCED ENERGY EFFICIENCY (NMEEE), 2008 The Prime Minister of India on 30th June

COVER STORY intensive industries and facilities, through certification of energy savings that could be traded. II.Market Transformation for Energy Efficiency (MTEE) – It accelerates the shift to energy efficient appliances in

Building sector energy demand

Achivement

Target

Escerts Issued/ Trading

designated sectors through innovative measures to make the product more affordable. Super Efficient Equipment Program is part of MTEE. Achivement

2008 announced the National Action Plan for Climate Change recognizing the need to maintain a high growth rate for increasing living standards of the vast majority of people and reducing their vulnerability to the impact of climate change. The action plan highlights eight missions out of all National Mission for Enhanced Energy Efficiency targets key programs for energy efficiency in the country.

Implementing NMEEE would save about 23 million tons of oil equivalents (MToE) of fuel by 2015 and about capacity addition of 19,000 MW will be avoided. The following four key initiatives are proposed under NMEEE: I.Perform Achieve and Trade (PAT) – A market-based mechanism to enhance cost effectiveness of improvements in energy efficiency in large energy

Target

Purchase escerts / Penalty

III.Energy Efficiency Financing Platform (EEFP) – It promotes the creation of mechanism that would help finance demand side management programs in all sectors by capturing future energy savings. IV.Framework for Energy Efficient Economic Development (FEEED) – It develops fiscal instruments to promote

Key Initiatives for Market Transformation Key Initiatives

Objectives

Market Tronsformotion through Energy Efficiency in Applionces Cap &Trade Program for Market Transformation

To set minimum energy standards for products and transform the market towards super efficient products. It is market based mechanism by which DesignatedC onsumers (nC’s),/EnergY Intensive Industries are motivated towards Energy Efficiency. Implementation of EE measures in existing buildings through ESCO’s mechanisms and sets minimum Energy standards for new buildings. Energy consumption reduction in agriculture sector through replacement of inefficient pump sets through PPP mode with efficient pump sets.

Energy Efficiency inBuililings AgricultureDSM program

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February 2012

Global policies to support use of energy efficient appliances Government Driven EU Program

Market Transformation Driven EU program

It promotes end-user to use energy efficienct appliances.

Tax Credit is given for EE equipmenpt urchasingin residentiasl ector

Promoting minimum energy performance standards (MEPS) of energy using appliances E, E labeling for appliances & equipment.

Upfront capital subsidy or Rebate on bill is given to the end users using energy efficient products”

Eco-PTZ (Zero Interest rate loan for energy efficient investment in residential)

Utility driven White Ceritificates Scheme in France

energy efficiency. Traditionally final energy consumption of all the nations across the world is classified into three sectors –Buildings, Industry and Transportation. Building sector is one of the major chunk areas and consumes around one-third of total global energy consumption with major loads include appliance, equipment and lighting loads. Energy is consumed in the appliances in residential as well as office buildings. It is one of the major sources of CO2 emissions with residential sector contributing to around 10% of global CO2 emissions. Thus countries all over the world realized the importance and need of promoting energy efficiency in appliances. “Labeling programs” and “Minimum Energy Performance Standards” for domestic appliances has emerged as a useful instrument to improve energy efficiency and market transformation.

APPLIANCE EE PROGRAM IN INDIA Importance of energy efficiency is well understood by GoI and Standard and Labeling program, as one of the flagship program of BEE, was launched in the year 2006. The program has contributed a lot in market transformation.

Car Labeling (Bonus Malus). Promotes lower CO2 emiting vehicles.

Reduced VAT 5.5% (instead ol 19.6%)o n EEa ppliances Policies and Programs Energy Conservation Act, 2001 empowers BEE to develop policies for improving energy efficiency of appliances in the country. The program was launched in year 2006 with voluntary labels for air conditioners and refrigerators. Bureau of Energy Efficiency has following programs in place to improve energy efficiency of energy using appliances and market transformation. Appliance Standard and Labeling Program Super Efficient Equipment Design program

Appliance Standard and Labeling programs are the first step to target products to achieve minimum energy standards. Till date, BEE has covered 14 products in their standard & labeling program and 6 products are in preparatory stage for development of standards. Super Efficient Equipment Program (SEEP) is a key program under NMEEE, which targets to create market for super-efficient products. It may involve providing incentives to manufacturers for incremental cost of producing super efficient products/technologies and addressing other market issues. As per BEE’s proposed plans, the target products to be covered under this scheme are fans

Stakeholders in building energy efficiency sector Authority/ Policymakers Technicla Support/ Technologies

End User

Bureau of Energy Efficiency (BEE)

Architects (ECBC expert architects)

Building Owner

State Designated Agency (SDA)

Engineers

Tenant

Municipal /Urban Loacl Bodies ( ULBS)

Energy Service Company (89 ESCOs accredited by BEE)

National Building Organization (NBO)

Construction Firms

CII/ TERI

Material Suppliers

February 2012

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ENERGY EFFICIENCY IN INDIA: KEY STATISTICS Milestones in Appliance Market Transformation

Sector wise CO2 emmission in 2010

( Source: IEA)

Minimum annual energy consumption of the designated consumer and estimated number of DCs. Sectors

Minimum consumption to become a DC ( Mtoe)

Aluminium Fertilizers Iron and Steel Cement Pulp andPaper Chlor Alkali PowerGeneration Plants (Thermal) Textile

7500 30000 30000 30000 30000 12000 30000 3000

Peak Demand Supply Shortage in India

(Source: PAT Consultation Document 2010 -11 )

Global Standard & Labeling Scenario

Global Trends in Cap & Trade market

Countries & year Establishment of Standard & Labelling Program

International cap and trade schemes International Scheme Target

Description

European Union Emission Trading Scheme (EU ETS)

Savings by 500 Mtoe/ Annum by 2020

The EU ETS is a mandatory emissions trading scheme covering over 10,000 energy intensive installations across the 25 member states of the European Union. Phase1 of the scheme operated from 2005-07. Phase 2 started in 2008 and will last until 2012

Climate Change Agrrement (CCAs)

Voluntary

CCAs are voluntary mechanisms that encourage energy efficiency in energy intensive industries in United Kingdom. CCAs were introduced in 2001and are set to expire in March 2013. However, the government intends for the scheme to continue until 2007.

Tradable White Certificates (TWCs)

France WC phase 1 target : 54TWh, Phase 2target = 345 TWh from 2O11-2O14

Tradable White Certificates are part of mandatory schemes implemented in several EU countries. Under this mechanism, producers, suppliers or distributor of electricity, gas and oil are required to undertake energy efficiency measures for the final user. France over achieved its target by 77.2 TWh in phase 1 (2006-2009)

CRC Energy Efficiency Scheme (CRC)

The CRC is the UK’s mandatory energy saving Reduce carbon scheme aimed at improving energy efficiency and reducing carbon emissions by 1.2 million tons of carbon dioxide emissions, as set out in the ClimateChange A ct, 2008. per year by 2020.

United Kingdom Emisssion Trading Scheme (UK ETS)

Voluntary

The UK ETS was a voluntary emission trading scheme created as a pilot prior to the mandatory EU ETS. The scheme ran from 2OO2-2O06

Perform Achieve and Trade (PAT)

9.78 million metric tons of oil equivalents

Discussed above

and LED lighting products. The Super-Efficient Equipment and Appliance Deployment (SEAD) initiative is another program for global market transformation effort, launched in Washington in July 2010. Its objective is to promote and raise efficiency ceiling by super efficient appliance through procurement, R&D, strengthening the foundation of efficiency programs etc. Six product categories focused in first phase of SEAD are Commercial Refrigeration, Computers, Distribution Transformers, Solid-state lighting, motors and televisions. This program is yet to evolve in India. Trading of energy saved is a wellaccepted mechanism to promote energy efficiency across the world. Many countries reaped high savings benefit by this “cap and trade mechanism”.

PAT PROGRAM IN INDIA Perform Achieve and Trade (PAT) is a similar mechanism developed in India. PAT is a market based mechanism for promoting energy efficiency in large energy intensive industries and facilities known as “Designated Consumers” (DC), through the means of energy saving certificates (ESCerts). PAT scheme was launched in April, 2011 under National Mission on Enhanced Energy Efficiency (NMEEE) with an objective of saving 9.78 million metric tons of oil equivalents and which in turn will avoid 5,623 MW generation over a period of three years in India. (The scheme is awaiting final notification for making it mandatory). Under this scheme, DCs will be given the specific energy consumption (SEC) targets to be met over the period of three

years. The scheme may have following three scenarios. The DCs achieve their set target. The DCs over achieve their set target. The overachievement may result in issue of Energy Saving certificates (EScerts) to the DCs. The DCs may under achieve their targets. These DCs can trade EScerts from DCs, who have over achieved their targets. In conclusion, we can go back to what Mr Yumkella had to say, “I strongly believe that now more than ever, the world needs to ensure that the benefits of modern energy are available to all and that energy is provided as cleanly and efficiently as possible. This is a matter of equity, first and foremost, but it is also an issue of urgent practical importance.” Saptarshi R. Dutta (Based on the PwC report Emerging Opportunities and Challenges, released at the India Energy Congress, 2012)

February 2012

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Cover Story Inside View

“Global specialist in energy management” Schneider Electric reaffirms its stand

or several years now, global energy demand has been growing faster than supply, which means that for any level of sustainability to be achieved, there is a clear need for more efficient generation, delivery and consumption of energy. Put simply, the world is using too much energy and using it inefficiently. On the supply side, the challenge is to efficiently modernize supply networks while incorporating a more diverse portfolio of energy generating technologies; while on the demand side, there is a huge opportunity to optimize consumption at the point-of-use. With today’s technology, the world could operate with the same level of functionality and comfort using 30% less energy. The energy industry has woken up to the fact that intelligent digital technology can improve energy efficiency throughout the chain from the point of generation

Schneider Electric worldwide

Schneider Electric in India*

15,000 +

billion sales in 2010

Employess

37 %

of sales in new economies

Global Manufacturing Plants

1,18,800 people in 100+ countries

10 +

394

20,000 +

in Fortune 500 ranking

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Authorised Partners, Distributors, System Integrators, Panel Builders

4 -5 %

1,000 +

of sales devoted to R&D *Figures as on June 2011

R & D Engineers

to the point of consumption. This is where Schneider Electric comes in as a company. The company’s watchword says, ‘committed to making the most of your energy’. Its vision statement states – ‘A world where we can all achieve more while using less of our planet’. As the global specialist in energy management, providing an

INTEGRATED SOLUTIONS FOR SEGMENTS Electric Utilities Water and Waste Power Management Water Oil and Gas Marine Mining and Minerals Metals Process & Machine Builders Machine Data Centres/IT Management Hospitals Hotels Office Buildings Security Retail Management Residential 24• PowerWatch INDIA

Distribution Centres

February 2012

White Space Management

Building Comfort Management

Regional Project & Engineering Centre

integrated approach designed for the reality of the digital economy, Schneider Electric is positioned in diverse ways in achieving this goal. Schneider Electric promises its customers with products, solutions and services which are: Safe: Protecting consumers, their customers and their business Reliable: Uninterrupted, ultra-pure power at all times Efficient: Up to 30 per cent energy savings Productive: Simplicity and peace of mind Green: Easy connection for renewable energies Power Watch India spoke to a cross section of the company’s experts to get to the crux of this commitment.

Power and Energy

Interview with

Dr Satish Kumar

Energy Efficiency Ambassador, Schneider Electric... management. The second key component is how we use the available electricity in the most efficient manner.

ow do you define energy efficiency? I think energy efficiency is a loaded term. It spans across the business operations of almost every sector be it building sector, industrial sector or IT or rural sector. Schneider Electric is the global energy management specialist. Energy efficiency is a very core component of Schneider Electric’s business strategy and essentially the tagline of the company which itself says, “We want to make the most of your energy bills.” I think this is a very carefully thought-out statement. This is the same approach we have in all our products and solutions right from switchgears, air circuit breakers, contactors to relays, etc. Since we are an energy management company, our first and foremost concern is on the safety and reliability part. Having said that, we ensure that the electricity should be used in the facility in a safe and reliable fashion. It needs to be available, where it is needed most. That’s the key component of electricity

In what ways are you engaging in bringing awareness about the concept of green buildings? We are actively engaging with both the government as well as the key industry associations to spread awareness about green buildings. Last year, we were the platinum sponsors for the CII-led IGBC event that was organized in Delhi. In the technical sessions, our company representatives presented four technical papers on various aspects of the green building concept. We are also working with the BEE and USAID in the setting up of benchmarks that will help in labelling the performance of buildings. This exercise is taken in view of the absence of adequate data on energy performance in buildings. Though the programme is already in place, we are working on to make it more robust by developing tools to collect data from commercial establishments like office buildings, hospitals, hotels and retail chain. The system will be based on a kWhr/sq metre, but could be adjusted according to the size of the facility, its number of occupants, hours of operations and the climate where the building would be located. This is a very specific example where we are putting the performance of the building to test. Currently, labelling of buildings is awarded on the basis of the building design. Here, labelling would be given by the BEE on the basis of the performance of the building.

Schneider Electric offers smart and efficient solutions to minimise downtime by 30 per cent and save 25 per cent or more on energy costs. The power efficiency solutions make lives safe, simple, reliable and of better quality. The company addresses customer–perceived challenges related to unsafe electricity. Environment-friendly smart power efficiency solutions guarantee consistent support to business and adapt to changing configurations without downtime to repair and update systems. Schneider Electric’s Distribution Automation Solutions and Feeder Automation Solutions improve service continuity of ageing equipment up to 50 per cent and reduce capex and opex up to 30 per cent. These solutions are reliable and ensure reduction of losses, therefore the equipment are guaranteed with 97.5 per cent availability for 20 years in the industry.

Renewable energy The renewable energy business of Schneider Electric is focused on designing and developing renewable energy products and solutions and providing best-in-class, global customer service and technical support. Schneider Electric provides full solutions from the panel DC output to the grid connection, including monitoring and supervision. Schneider Electric’s customisable solutions are specifically designed to meet the growing demand of large scale grid-tied solar farms and large commercial rooftop solar installations. Some examples of products and solutions are PV Box, climate controls, SCADA monitoring equipment, and power metering.

February 2012

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PowerWatch INDIA

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Cover Story Inside View

Interview with

Nikhil Pathak Vice President, Buildings Business Unit, Schneider Electric...

hat is the role of your division within Schneider Electric? How is your business division aligned with the group’s global business practices? We, at Schneider Electric’s building business division are basically focusing on intelligent building management systems (IBMSs). In a building, one needs a centralized control system to intelligently control many systems and thousands of data points it can generate. We provide that system. We basically offer an integrated approach that unites multiple systems on one network across enterprises, from a single software platform. Once integrated, data from those systems are assimilated and converted into information that empowers decisions and actions that enhance efficiency, comfort and well-being for building occupants and owners.

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We’ve helped design and install intelligent building management and security systems that deliver solutions for HVAC, access control, video surveillance, lighting control and energy efficiency. We are the experts in IBMS. We have top-of-the-line and high-end products such as Continuum and TAC, amongst many others. These are two different IBMS platforms that serve different technological needs of different consumer groups. Continuum is more suitable for applications in typically large organizations, whereas INET is more appropriate to run small or standalone security systems. Then we have PELCO, which is a brilliant video surveillance system, which runs on very high technology and has its applications in almost all sectors ranging from commercial buildings to power and gas. You name it, and we have it. Our strength lies in integrating these systems. We work in close coordination

February 2012

with building architects. We sit with them, understand customer needs and provide them an integrated solution. Another key focus is on security part of our systems. We have security experts. We are doing a lot of critical infrastructure security projects in the areas of power and gas, airports, city and road surveillance projects. In India, we are particularly aggressive about critical infrastructure projects. For that, we have acquired Zicom almost half a year back. This acquisition has made us specialists in this segment also.

EcoStruxure EcoStruxure is an IT, buildings and process architecture designed to help companies slash their energy usage. The architecture offers help in reducing power used in datacentres, other buildings, and processes and machines. It is aimed at businesses that are trying to cut their power bills, be greener and provide a consistent energy supply to their facilities. Many firms still take an uncoordinated approach to energy that is only partially effective. Obstacles to saving energy include capacity constraints, poorly designed systems, a lack of standardisation, and conflicts between departmental policies. For datacentres, EcoStruxure draws on the InfraStruxure architecture that Schneider Electric inherited from the APC acquisition. The platform provides modelling for different possible future scenarios, and also aims to aid businesses with quickly identifying and resolving power issues as they emerge.

Our connections deliver so much more than ﬂuid systems.

Your Swagelok representative is your connection to so much more than you expect. Yes they’re experts in their own right. But beyond that, they can tap into the global knowledge accrued in more than 65 years of research, development and innovation. Your authorized Swagelok representative is ready to work with you and provide you with the tools and problem-solving solutions that deliver a real business edge and so much more too – because in this business you need all the right connections. Visit swagelok.com/connections.

Cover Story Inside View

“You can’t bring in energy efficiency without bringing in new technology” Mr Olivier Blum, Managing Director – India, Schneider Electric, explains why to PWI…

hy does Schneider Electric call itself an energy management

company? In the past century, Schneider Electric has grown tremendously. The core business of Schneider everywhere in the world is energy. In the beginning, the company concentrated more on products than services. We declared ourselves as an energy management company because we have been present in the realm for 100 years now. We turned from a pure product player to a product and solutions player, offering turnkey solutions to our customers. The major focus of doing so was to become a global provider of energy management solutions. We didn’t want to engage only in assembling products for our customers, but also to

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help them achieve energy management. At this point, I want to clarify that we do not generate energy; we manufacture devices that consume energy like lighting, motors, etc. We are strategically positioned between generation and consumption, to help customers achieve energy efficiency What’s your take on the Indian industrial eco-system with regard to efficiency? Ten years ago, governments and companies did the mistake of promoting energy efficiency with the aim of saving the planet, which was not a strong enough driver for the industry. In India, till five years ago, it was difficult to convince people about the significance of energy efficiency. But, as of today, all sectors in the country are working towards becoming energy efficient to save money in their operations. Big companies, especially in the telecommunication sector, spend maximum money on energy, so a saving of around 10-30% in the energy bills will translate into huge cost savings. People in India are becoming more and more conscious about using power back-up solutions. Though it would have been better if the government was more proactive on this front, still, we have seen lot of transformation.

February 2012

Which of these industries – manufacturing, hospitality and real estate - are the biggest up-takers of energy solutions in the Indian market? The manufacturing industry is clearly the biggest opportunity because they need quality energy and reliability. I wish to add that telecommunications and residential also make for major sectors for achieving energy efficiency. But, it is a very difficult task to transform this segment without the government’s support. There is a huge opportunity of energy management in the Indian residential real estate market. Can you suggest an energy management model which can be replicated in Indian homes? The model of energy certificates in France is very good for India. These certificates are issued based on the quality of infrastructure. The air conditioning, heating system installed in homes and many other factors are evaluated for certifying a building as energy efficient. The problem in India is that people living not just in residential buildings, but also those in commercial buildings, focus a lot on capex in terms of investment but not on opex, which will be spent in the coming, say 10 years. The Indian government needs to make certain certifications mandatory for builders to make energy efficient buildings. Tell us about some of the energy management projects that Schneider has taken up in India.

Our Hyderabad building is amongst the top 5 in the country and was recently awarded for setting an example that 20-30% energy savings can be achieved with energy efficient practices Our Hyderabad building is amongst the top 5 in the country and was recently awarded for setting an example that 2030% energy savings can be achieved with energy efficient practices, compared to a normal building. Our data centre in Hyderabad is a state-of-the-art centre in terms of construction. We have another data centre project in Noida, which is again a state-of-the-art facility. We have also undertaken many commercial buildings and hotels in the country. Schneider was recently awarded the Zayed Future Energy Prize for carbon disclosure project in the UK. Can you tell us more about this? The award was given to us because we implemented the latest technology available in the field of energy efficiency. We believe that you can’t bring efficiency without bringing in new technology. Schneider is quite advanced in understanding different technologies and putting them together. This is very essential in buildings, offices, homes and factories wherevariouselementslikeairconditioning, heating, PC consumption, lighting, etc., live together. What differentiates Schneider from other companies is the fact that we the are leaders in low voltage, as well as

medium voltage. Also, we are launching a big software platform for EcoStruxure and are working on a project for managing the traffic of Mumbai. Having said this, I would want to add that as private companies, it is our responsibility also to support the government in moving faster towards the goal of energy efficiency. What are your expectations from the government policy, regulatory set up of the country in terms of energy efficiency? We expect them to clear the dialogue and agree on simple projects, which are executable and the government commits to them. What I suggest is that we pick up an industry, give our recommendations and then we implement them. India has a large pool of talented human resource, trained in engineering and sciences. Knowing that Schneider has employed more than 1,500 people in the country, do you think the resource pool is up to

the level, in terms of expertise and openness to new technology? Of course yes, they are meeting the expectations of the energy efficiency economy, which we are trying to build in the country. We have a number of energy auditors in India and I must say they are world-class auditors. In fact, they are recognized in Schneider as amongst the best. So, we can say that in India, those who are qualified are top-class. However, the problem is how to bring the rest up to this level, to fill the shortage. India is a big country, so people are wrong when they say that India doesn’t have qualified people. There are various segments and those in our segment are excellent in skills. Is Schneider doing anything to bridge the gap between industry and academia? We conduct university visits and the recent one was in MDI, Gurgaon, where we spoke about energy management to make sure that we contribute to the issue through dialogue.

February 2012

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PowerWatch INDIA

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Cover Story Inside View

L&T commits to go green

n a bid to come across as a environmentally conscious conglomerate, India’s largest engineering company, Larsen & Tubro (L&T) Limited, which is mainly identified with large, thermal power projects, is all set to redefine its corporate image. At the recent Elecrama in Mumbai this month, the company has showcased its commitment towards ‘going green’ in all its operations. Its green portfolio cuts across its business verticals, with multiple verticals acknowledging the significance of offering eco-friendly products. At the exhibition, Mr. A.M. Naik, CMD, L&T Ltd., briefed media on the milestones set by the company in the domain of sustainability and green operations, “L&T’s Buildings and Factories business vertical has constructed more than 10 million sq. ft. of green building space for consumers, the largest by any construction company in India. L&T’s solar business unit provides EPC solutions in solar photovoltaic (PV) systems. Our Hydrocarbon business vertical executed energy conservation and fuel switch projects for fertiliser manufacturers. The eco-care line of electrical and automation business provides energy management solutions to customers and consists of tools to measure, monitor and reduce

Green Product Portfolio 30• PowerWatch INDIA

their energy consumption.” “The coal gasifier business of L&T Heavy Engineering helps customers bring down costs through an environment friendly process that uses coal more efficiency. Our machinery and industrial products business manufactures large size castings for critical applications in wind turbines. L&T integrated engineering services also provides carbon footprint mapping solutions,” he adds. Wind Castings The company manufactures large size castings for wind turbines at its stateof-the art foundary at Coimbatore and enjoys a dominant 45 per cent market share in India. Power L&T has set up a Rs 20 billion supercritical equipment manufacturing facility at Hazira to serve national and international power plants. The supercritical technology based power plant provides a host of sustainable benefits such as reduction in fuel cost, reduction in coal consumption up to 5 per cent, resultant reduction in CO2 emissions, minimised dependency on uncertian supply and volatile pricing of hydrocarbon inputs, water savings of approximately 5-7 per cent, land savings of approximately 20 per cent, savings in

Sales 2010-2011 (Rs Bn) •

February 2012

spare part consumption of 20-30 per cent over the life cycle. Hydrocarbon The production of fertilisers is one of the most energy-intensive processes in industry. Policy and profits are persuading fertiliser manufacturers to switch from fuel oil and Low Sulphur Heavy Stock (LSHS) based ammonia plants to natural gas and Re-gasified Liquified Natural Gas (R-LNG) based ones. L&T is the leading turnkey provider of technology to enable this fuel switch and is already executing three such projects, one for GNFC (Gujarat Narmada Valley Fertilizers Company Limited) which will result in energy conservation of 39.02 per cent per metric ton of Ammonia and two for National Fertilizers Limited which will result in 26 per cent reduction of energy consumption per metric ton of ammonia. The cleaner fuel will have added advantage of less than 10 ppm of SOx emission and elimination of ammonia discharge in the waste water. Solar EPC L&T provides turnkey EPC solutions for solar PV power projects. Solar projects with a cumulative installed capacity of 83 MW (Megawatt) are under various stages of execution.

Revenue from Green Product Portfolio 42.65 Tatal Sales Percentage of Total Sales

438.86

9.72 %

PROJECT HIGHLIGHTS

Area covered: 35 acres Type of module:

Thin film solar module (with efficiency of 6-8%)

Number of modules in Plant: 39,090 Green Buildings Green building is a thrust area for L&T. The company has constructed 10.2 million sq. ft. of certified green buildings in their own campuses to create sustainable work spaces that not just utilise fewer natural resources, but also generate less waste and provide a safer and healthier environment for its employees. Till date, L&T has six certified green buildings at its premises and another three are in the process of green certification. Hydro Projects Hydroelectric power projects provide energy without combustion of fossil fuel. L&T has developed the requisite capability to execute hydel projects and is targeting an installed caapcity of 200 MW as a developer or EPC contractor over the next few years. Carbon Footprint Mapping L&T Integrated Engineering Services provides carbon management solutions, which include carbon footprint mapping, identifying ‘Hot-Spots’ in processes,

L&T provided turnkey EPC solutions for a 5 MW solar PV power at Surendranagar District, Gujarat, including design, engineering, manufacturing, procurement, erection, testing and commissioning.

facilities and project sites plus recommendations for ‘Cost Avoidance’ in terms of energy, operations and materials cost. Metering Distribution is the weakest link in India’s power sector, with aggregated technical and comemrcial losses (AT&C) amounting to 30 per cent. A major component is due to pilferage and inefficiencies in metering. L&T Metering and Protection Systems (MPS) Business Unit has initiated development activity on the eco-system required for smart meters and developed technologies for communication of meter data over GSM network / low range radio / power line. These initaitives will ultimately integrate with the smart grid project of the GoI which aims to enhance transmission and distribution efficiency. Building Management System Entire suite of products like energy meters, power factor improvement capacitors, drives and solutions in energy management and plant automation help reduce energy consumption in buildings and industries. Eco-Care As a certified Energy Service Company (ESCO) by BEE E&A Business Unit provides

OUTCOME Total project value:

Rs 638 million

[ approx USD 14 million]

Estimated annual green power generation:

7.8 MU ( million units) (~20,000 kWh per day)

energy audit service under brand Ecocare and equip our customers with the necessary tools to emasure, monitor and reduce their energy consumption. Heavy Engineering Developed economies like USA, Europe and Australia are considering power plants based on coal gasification instead of conventional power plants. Coal gasification projects are being implemented to supply syngas for manufacture of ammonia, methanol, CTL, MTO, etc. In a nutshell, a promising megatrend is developing across the world. L&T forayed into the coal gasification business in 2004 and has already supplied 10 gasifiers for various projects internationally.

February 2012

Write to us with your feedback at pwi@nextgenpublishing.net

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PowerWatch INDIA

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Cover Story Inside View

Cutting-edge design ensures

smarter systems

Starting with just four employees in 1987, STMicroelectronics’ operations in India have come a long way, evolving into an organization with close to 2,300 employees, all of whom contribute to ST’s worldwide success...

T was one of the very first microelectronics companies to recognize India’s potential and, by 1990, had begun its design operations in the country. Coupling a rich pool of talent with a wellfocused strategy, ST’s advanced R&D centres at Greater Noida and Bangalore are contributing significantly to almost all key application segments of the company.

RESEARCH AND DEVELOPMENT ACTIVITIES IN INDIA The range of R&D activities carried out by ST in India reflects the multi-faceted nature of ST’s cutting-edge technologies and the exceptional ability of India’s engineers to create industry-leading solutions. In product design, engineering achievements in India include the development and industrialization of high32• PowerWatch INDIA

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value platforms, SoCs (systems-on-chip), embedded systems, application-specific IP (intellectual property), and reference designs in various application segments including multimedia, telecommunications, automotive and industrial control. ST designers in India have developed embedded solutions for a wide variety of applications, including set-top box, wireless, digital TV and multimedia. ST’s engineers in India have made a substantial contribution to the development of the company’s leadingedge low-power 45nm design platform. ST designers in India have developed libraries for 32nm and are now working to develop 28nm design platforms for future-generation products. ST’s design teams in India specialize in VLSI design, embedded software development, application engineering and the company’s information systems.

February 2012

The ST India Advance System Technology Group is developing advanced videocoding algorithms. ST’s Automotive Product Group in India has contributed to the design and integration of Cartesio navigation devices and the EyeQ automotive security and safety processors. Other ST products and technologies to which ST India’s engineers have made significant contributions include the SPEAr embedded microprocessors, imagesignal processing chips for mobile phone cameras, and non-volatile and power silicon technologies. ST in India has filed close to 400 original patents applications to date, of which around 195 have currently been granted. The company’s state-of-the-art R&D campus on an area of 100,000 square meters at Knowledge Park 3 in Greater Noida, Uttar Pradesh came up in 2006, with a capacity for more than 2,000

Caption: Greater Noida is ST’s largest design centre outside Europe

engineers and support staff. To take full advantage of the fast growing development of the country, ST established a design team of around 50 engineers in Bangalore in 2004. Today, the Bangalore Design Center employs over 570 engineers, of which about 370 are working for ST-Ericsson. Efficiency at the core STMicroelectronics provides key technologies to build smart grids, which optimize energy consumption, make the entire electricity distribution system more flexible, reliable and increase the use of renewable energy sources on a large scale. Semiconductors are a key ingredient of this energy revolution. The company has been applying the strategy of efficient developments in two determinant convergent paths: Technology efficiency: Focus on development of advanced semiconductors technologies and innovative integrated architecture. STMicroelectronics has developed world’s most efficient power-handling electronics technologies such as

STMicroelectronics’s MDmesh power transistors that provide ultra-low-loss switching performance and low-power as well as high-miniaturization technology for system-on-chip applications. Application efficiency: Design of smart systems with embedded microcontroller (STM32) real time monitoring and connectivity. The resulting design portfolio and systems design knowhow allow STMicroelectronics to play as leader in this scenario, thanks to various evaluation boards for key smart grid segments, such as: I.Renewable Sources: The trend of photovoltaic (PV) architectures is towards distributed solutions, which means more electronics embedded on each PV panel. This approach enables a complete monitoring and control of the panel, maximizing the energy efficiency, safety and reliability of the whole system. STMicroelectronics has developed dedicated products for PV (for example, the new SPV1001 cool bypass switch and SPV1020

boost converter with built-in MPPT algorithm), as well as evaluation boards for 250 W micro-inverters and for power optimizers, enabling customers to easily evaluate STMicroelectronics’ technologies directly on PV panels in the most effective way. II.Smart Metering: An electronic power meter with full remote control and diagnostics function. STMicroelectronics is a world leader in advanced metrology ICs and system-on-chip platform (STarGRID).Thanks to these products and using Power Line Communication technology (PLC), STMicroelectronics has designed innovative solutions, compatible with future smart-grid protocols, able to connect the meter with the service provider enabling new features, such as diagnostics, power peak and consumption analysis, antitampering mechanisms, fault alert, timevariable tariffs, and many more. Specific applications areas include photovoltaic modules, electric-vehicle networking, home area networking and streetlighting management.

February 2012

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PowerWatch INDIA

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Cover Story Inside View

Interview with

Vivek Sharma

Director, India Design Centres, STMicroelectronics Pvt Limited... we can reach through the mode of electronics. Unfortunately, India’s share in the consumption of healthcare facilities is very low at 1.5% of worldwide levels.

ell us about STMicroelectronics’ product profile? We are a transnational company with more than 50,000 employees spread across the world. Our presence is very strong in Europe and the US. More than half of our sales, i.e., close to 60% come from Asian countries. I would like to add that we operate in more than 30 countries. We are a broad range company, having semiconductor solutions for various segments – energy and power, industrial, consumer market, wireless, automotive, imaging and computer peripherals. Within the industrial segment, we are into sensors, efficient

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micro controllers and legacy products. In the consumer segment, we are a strong leader in set-top boxes, digital TV solutions, engine control (for the automotive segment), and vehicle safety products. Our portfolio also covers flashers, lights, doors and navigation systems (GPSs). We have created a benchmark in healthcare solutions like ECG body gateways, lab-on-chip for pathological purposes, etc. We are also working with ST-Ericsson for wireless services. We also make telemedicine solutions, a great leapfrog from the healthcare aspect. It is very valid for India, where close to 70% of the population lives in rural areas and does not have access to medical facilities. In such areas,

February 2012

Please shed light on the role of semiconductors in energy efficiency. Semiconductors lie at the heart of electronics and are an important component of energy metering solutions. It finds application in smart grids. In a holistic sense, a smart grid relates to generation, consumption, distribution and communication, all put together. With respect to generation, converters and inverters are integral part of smart grids, apart from solar panels. On the consumption side, energy efficiency is the key driver. Semiconductors are used in cars, which are these days run by electronics. In fact, energy efficient lighting including LEDs and CFLs also find usage of semiconductors. Semiconductors find application in conditioning of power to be able to feed to the grid, communication, in devices enabled with electronics. In a nut shell, the entire value chain is covered by semiconductors and we provide solutions for them at every stage. What are some of STM’s solutions for the energy industry? On the generation front, we offer solutions for micro-inverters - DC to DC, DC to AC. We have a big range of strong, low power consumption micro-controllers having wide applications. We are focused on ensuring minimum power consumption.

On the distribution side, we are a leader in power line modems. We have a whole olio of sensors and have a strong presence in smart energy meters with power factor correctors. We have solutions for lighting – LEDs, CFLs, solar ery chargers, etc. Please elucidate on the company’s olio. We have a leading edge in process technology. Semiconductors use silicon ere e front end is to develop silicon wafers and the back end implies packaging. Semiconductor products need these technologies to develop - one is CMOS, mainly used for digital products; and the other very powerful technology is BCB (Bipolar CMOS-DMOS). In bipolar, we can do precision analogue calculations. CMOS helps in processing and DMOS is useful in managing power. We also

STMicroelectronics is in a strong position to develop great products in the realm of power and multimedia convergence. How are you positioned vis-à-vis global competition? Overall, we were positioned 7th last year. However, we have consistently secured the 5th position globally. In the power segment, we have been in the top two/ three positions. How are you aligned with the government’s plan of injecting Rs 500 crore for small smart grid pilot projects cation? program for India. To make it a success, we need to standardize it as early as possible. Standardization helps new development

e government, in tandem with the Ministry of New and Renewable Energy, BIS and TERI, has ing up pilot projects, and we have also associated ourselves with them. Another important thing that needs to be done is making comprehensive models and be able to duplicate it fast. With technology, we ese are great initiatives taken by the government, but policy regulation needs to be robust. What policy framework can you suggest for the electronics industry? ere is a strong and urgent need to kickstart the development of electronics in the country. Till some time back, we were doing quite well on this front, with local brands developing the industry and also, the local industry was well protected. However, when the economy opened up for globalization, we saw ing killed, as they could not compete with foreign products. Electronics is the driver for semiconductors, and electronic system design and manufacturing (ESDM) is a key component for India to develop

nurture independent entrepreneurs expertise, but lack funds to set up their I would go for creating a separate fund, from where these people can be provided loans at low interest rates. In addition, these entrepreneurs could also be given an assurance of an endmarket for selling their products. Does STM have a global commitment towards engineering training/ excellence program? At STM, we have always believed that a strong association with the academia is integral. We are passionate about bringing the academia and industry together. In Europe, we are linked with many research institutes. In India as well, we have three operational labs, and are working with BITS Pilani, IIT Delhi and Delhi Technical University. We used to have a lab with the Indian Institute of Science in Bangalore, which we ran for around 10 years. In order to develop and excite engineering er products, we participate in embedded systems conferences, where we make students aware about the various technologies available.

February 2012

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PowerWatch INDIA

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Cover Story Inside View

Underwriters Laboratories has set up its state-of-the-art laboratory in Manesar that will provide energy efficiency and performance testing for a host of lighting products, home appliances and electrical equipment...

A New High for Testing and Verification Services in India

n d e r w r i t e r s Laboratories (UL), an independent product safety testing and certification organization has opened the first dedicated energy efficiency testing laboratory at Manesar, Gurgaon for providing energy efficiency and performance testing for Indian manufacturers. This will be in line with the ‘star labeling’ program of the Bureau of Energy Efficiency (BEE), Government of India. Set up with an investment of $2.2 million, the 18,000-sq ft lab is equipped with state-of-the-art testing, verification, design and product development facilities. This will help manufacturers in the

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LED lighting and HVAC (Heating, Ventilation and Air Conditioning) industries develop and test energyefficient, better-performing and safer products. The lab is equipped to test lighting products, consumer goods

such as domestic refrigerators and washing machines and electronic equipment, including computers and colour televisions. UL has built the first commercial refrigeration system testing facility for testing open-deck chillers for energy efficiency in the lab. This particular facility in India will considerably reduce manufacturers’ cost and time to market. “Saving energy for self and the nation is the motive behind the government of India initiatives of the Standard and Labeling Program and UL, as an independent 3rd party lab setting up facilities to test the energy efficiency parameters, has set up a precedent in this field, as this will be a dedicated lab for the EE testing only,” said Mr. R A Venkitachalam, Vice-President and MD, UL Emerging Markets.

LIGHTING AND LUMINAIRE VERIFICATION The lighting and luminaire industry has been undergoing a dynamic change since some years. With the current trend towards more energy efficient products, in particular the LEDs, verification testing has become all the more important. In this field, UL

BEE’s Star Labeling Programme According to the Standards and Labeling programme coined by the Bureau of Energy Efficiency (BEE), only the products having specified energy efficiency levels will be allowed to be manufactured and marketed in India. The programme currently covers frost-free refrigerators, CFLs, air conditioners, distribution transformers and induction motors on a mandatory basis. These appliances are rated as per their energy efficiency levels and are marked with stars ranging from 1 to 5, in increasing order of efficiency. The estimated annual energy consumption is displayed on the Star Label for the benefit of customers. The energy efficiency labeling system means lower energy bills for customers and higher sales for labeled products. It will soon cover pump sets, ceiling fans, LPG stoves, electric geysers and color televisions.

February 2012

offers photometric testing equipment, including goniophotometers, integrating spheres, LM-80 life test systems, lamp life test systems, rapid cycle test systems, photobiological safety test system, noise analyzer and anechoic chamber. The company undertakes the following tests for lighting and LED products: ENERGY STAR ® DOE- Lighting Facts Label DLC- Design Lighting Consortium Solid State Lighting (IES LM-79, CIE 127) LED Package/Array/Module (IES LM-80) Compact Fluorescent Lamps (IES LM-65, IES LM-66) Fluorescent Lamps (IES LM-9, IES LM-40, IES LM-41) Incandescent Filament Lamp (IES LM-49) Photobiological Safety (IEC 62471, CIE S009)

STANDARDS COVERED The lab will test the products based on the Indian, US and European standards, for their performance capabilities under different environmental test conditions suitable for different climate requirements. The major standards covered by the lab are: US Environmental Protection Agency ENERGY STAR ® National Resources Canada (NRcan) California Energy ® Commission (CEC) Cool Roof Rating Council (CRRC) US Department of Energy

ENERGY STAR

government program during the early 1990s. However, following the footsteps, Australia, Canada, Japan, New Zealand, Taiwan and the European Union have also adopted the program. Devices carrying the Energy Star logo, such as computer products and peripherals, kitchen appliances, buildings and other products, generally use 20–30 percent less energy than required by federal standards. The Energy Star is awarded to only certain bulbs that meet strict efficiency, quality, and lifetime criteria. Also covering lighting products, Energy Star qualified fluorescent lighting uses 75 per cent less energy and lasts up to ten times longer than normal incandescent lights.

Energy Star is an international standard for energy efficient consumer products. It originated in the US as a United States

Monica Chaturvedi Charna Write to us with your feedback at pwi@nextgenpublishing.net

Interview with

R A Venkitachalam

Vice-President and MD, UL Emerging Markets...

hich are the products that can be tested for certification at UL’s energy efficiency laboratory in Manesar? UL’s energy efficiency lab in Manesar has the capabilities of testing domestic home appliances like refrigerators and washing machines, lighting products

like lamps, TFL, CFL and LED based lamps and luminaries. From April 2012 onwards, the lab will also offer services for testing other electrical and electronic based products, such as color TV’s, laptops and desktops. Kindly give an account of the various testing facilities available at the lab. The Manesar lab is well equipped

to test the lighting products for their performance and safety aspect to global standards. The main feature of this lab is the Type C Goniophotometer– a tool required for LM-79 testing, which helps light source to be installed in a similar way as it is done on the field. It provides the most accurate readings, as the light source is not tilted, and thus the heat profile isn’t constantly changing throughout the measurement

February 2012

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PowerWatch INDIA

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Cover Story Inside View cycle. The lab holds the capacity to test 6 samples at a time - an environmental chamber could determine the performance capabilities of the domestic and commercial refrigerators to any global market requirements, including volume measurements, for the energy consumption parameters. The lab also holds the capacity to test products as per ISO standards using the M Packages. How do you view the market for these testing facilities in India? How do you plan to create the pull factor for Indian manufacturers? India’s economic progress has made its energy efficiency program more visible and active, as the country aims for greater energy conservation through improvement in the existing and new technology. Statistics released by the Bureau of Energy Efficiency (BEE) reveal that consumer goods companies can achieve sustainable growth by reducing their environmental impact and enhancing energy efficiency. i.e. companies can produce the same output or increase their output even as they reduce the consumption of energy by undertaking various activities that are in line with global standards’ requirement. Companies can also invest in systems to monitor energy consumption and predict energy inefficiency. What is the role of BEE in the testing and certification services provided at the Manesar lab? BEE will co-ordinate with designated consumers, agencies and other organizations and recognize, identify and utilize the existing resources and infrastructure, in performing the functions assigned to it under 38• PowerWatch INDIA

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the Energy Conservation Act. The Energy Conservation Act provides for regulatory and promotional functions where BEE will develop minimum energy performance standards and labeling designs for equipment and appliances. UL with its expertise will help BEE in arriving at a testing methodology for the various products. BEE will remain the nodal body in creating awareness and disseminating information on energy efficiency and conservation. What does the lab have to offer for lighting products? The lab provides customized reliability, performance, and energy efficiency testing for products based on regulatory, industry, and retail requirements or customer-specific protocols. This facility houses several state-of-the arts testing equipments like Type C Goniophotometers and integrating spheres of varying sizes. To support various customer requirements, the lab is also in the process of completing other essential global accreditations, including NABL NAVLAP accreditation for Energy Star Integral, Lamp Test Package, Lighting Facts label test package, Integrating Sphere or Type C Goniophotometry to IESNA-LM79 and Lighting Performance Testing. How is the new laboratory different from the one in Bangalore? Saving energy for one’s own self and nation is the motive behind the government of India initiatives of the Standard and Labeling Program, and UL as an independent 3rd party lab setting up facilities to test the energy efficiency (EE) parameters, has set up a precedent in this field as this will be a dedicated lab for the EE testing only.

February 2012

LEDs are being seen as the future of lighting globally, how do you see its scope in the Indian market? LED technology has been globally recognized as extremely efficient and eco-friendly in comparison to the Incandescent Lamps (ICLs) and florescent lamps (FTLs, CFLs). Penetration of LEDs in India could significantly reduce lighting load, peak demand and overall energy consumption without compromising on the entire lighting industry in India. The Indian LED market is anticipated to grow at 54 per cent till 2014, based on the industry estimates. The growth factors can be attributed to government support for promoting investments in energy efficient lighting, development of national standards for testing and performance evaluation, transfer and improvements in existing technology for new applications, global mandate to address green house gas (GHG) emissions and decline in average prices of LED. The lighting technology would improve over a period of time both in terms of efficacy and life. It is very difficult to predict this improvement in technology. The quantum of these improvements would depend on the maturity of the technology and the market outlook towards these technologies. The efficacy of LEDs is expected to double in the next 20 years. Formation of the National Standards for LEDs would accelerate the market development of LEDs as government can exhibit the same through procurement processes. Thus independent labs in the field of the photometry testing is the need of hour, which will stimulate the R&D activities in the country.

With modern manufacturing units in India, and a widespread sales & service network, we add value to every product and service that we render. Efficiency, economy and reliability are part of our design culture and backed by our innovative approach to technology, makes us the most preferred supplier to industries across the world.

Keeping in line with our innovative approach to design and performance, we have developed and commissioned equipment that not only generate and transmit sustainable power but also ensures the protection of our environment. Our latest innovative portfolio in Power Transmission, Power Distribution and Industry Automation includes a gamut of

Providing sustainable power to the planet Intelligent, productive and energy-efficient products and solutions www.siemens.com/energy products and solutions in Low & Medium Voltage, Gas-insulated Substations to Smart Grid integration and e-Mobility Solutions. When it comes to providing innovative solutions to supply sustainable powerâ&#x20AC;Ś you can trust us!

For more information: Siemens Ltd. Energy Sector Plot 6A, Sector 18, Maruti Industrial Area, HUDA, Gurgaon 122015 Tel.: (0124) 383 6000 Fax: (0124) 383 6261

Answers for energy.

ADVERTORIAL

On a high growth trajectory Hitachi commits to nation’s development Company consolidates Indian businesses and brings more products and services to the fore

INFRASTRUCTURE INVESTMENT TRENDS

India: Rising infrastructure demand propels investments

Registering

8.5% GDP growth in 2010-11, India’s growing economy is witnessing an unprecedented demand for world-class social infrastructure systems. The 11th Plan period (200712) has projected investment in

infrastructure development to the tune of $500 billion. About 36%, or $186 billion, of this investment is expected to be met through public-private parternships (PPP), up from 25% for the 10th period. The World Bank reports, in 2007, the sector contributed about 5.5% to the nation’s GDP, with the continual rise in share every year. There is wide recognition that the development of a good quality infrastructure that meets global standards, is essential for sustaining the high rate of economic growth.

Around 10% of GDP is likely to be invested in infrastructure in the 11th Plan Private investment likely to contribute one-fourth to total infrastructure outlay

IT and environment technologies: The backbone of next-gen smart infrastructure The next generation social infrastructure systems have already started emerging in India in order to achieve a low-carbon and more sustainable society. Under India’s largest infrastructure project of the decade, DMIC, a total of 24 such new generation cities are being planned for phased development across UP, Haryana, Rajasthan, Madhya Pradesh, Gujarat

and Maharashtra. Seven of them will be ready by 2018-19. Plans for extensive use of digital, control and environment technologies are under way in order to accelerate the evolution of energy-efficient cities that will have better management of civic infrastructure, an efficient public transportation system, stable supply of power and water.

US$

590 million people will live in Indian cities by 2030, for which an investment of $1.2 trillion will be required Major global E&C giants are participating in prestigious social infrastructure projects in India

billion

a mega DMIC project being implemented in collaboration with Japan, envisages setting up of one of the longest industrial corridors between Delhi and Mumbai and seven smart cities by 2018-19.

INDIA’S INFRASTRUCTURE SECTOR AT THE CENTER OF ATTENTION Nearly

all of the infrastructure sectors in India are presenting excellent opportunities for foreign investors, with roads and highways, ports and airports, railways and power standing out as particular bright spots.

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the construction domain, international EPC contractors have already established presence in the country. Some key international players have carried out civil works for the prestigious

February 2012

Delhi metro project. Japanese corporations such as Hitachi, among others, are involved in designing and building of the eco-friendly towns along the Dedicated Freight Corridor (DFC).

INTERVIEW

Mr Shigeru Sugiyama, Deputy Managing Director, Hitachi India Pvt. Ltd.; Chairman, Hitachi Hi-Rel Power Electronics Pvt. Ltd.; Chairman, Hitachi NeST Control Systems Pvt. Ltd.

“Next-gen smart infrastructure will be realized by total integration”

Hitachi, Ltd. is now a 100-yr old company. Since the beginning, it has

consistently been contributing to building Japan’s urban infrastructure - electric power, water supply and transportation, and been helping fulfil the Japanese way of life. Japan’s urban infrastructure is one of the world’s best, with little or no power outages, on-time train systems and ‘safe to drink’ tap water systems. A lot of these high class social infrastructure in Japan come from Hitachi’s technologies. As of end-March 2011, Hitachi has 18 group companies in India, with 6,000 employees. The business size in India is approximately worth 90,000,000,000 Japanese Yen (90 billion JY). The relationship between India and Hitachi is now over 80 years old, as Hitachi started selling fans for houses in the year 1933. Hitachi has also been in the business of information technology (IT), Power Plants, Steel Plants and much more. Recently, Hitachi has been involved in the Indian government’s projects relating to social infrastructure such as electrical power, water supply and transport. One of them is the Delhi-Mumbai Industrial Corridor (DMIC).

Hitachi India: Synergetic Growth Hitachi Hi-Rel Power Electronics (HHPE) UPS systems Medium voltage inverters

Hitachi concludes formation of alliance with Hi-Rel Electronics

What is Hitachi Control Technology? As India’s economy develops rapidly, a stable power supply and highly efficient energy need to be provided. Hitachi owns a control system, which allows stable electricity supply along with efficiency. The company also owns an information system, which provides efficiency to operations. As Hitachi owns both systems, the company can integrate the two to provide optimized systems, products and solutions for efficient energy, suitably for India. This integration of control and information is not just about processing data for efficient operations. It collects and analyses factories and infrastructure operations information. The system also sends the result of this analysis for feedback to the system, which creates better products, optimization and makes the process delay-free. This system is an essential requisite for enhanced efficiency and optimization to streamline the development of social and urban infrastructure, such as thermal power plants, energy transmission lines, railway lines and large sized steel plants. These are also fields where Hitachi is very good, which stands affirmed by the industry as well. What are the company’s offerings aimed at the infrastructure industry in general and the energy sector in particular? Due to rapid economic growth in India, customer needs are growing, such as building large sized factories (eg. power plants, steel plants, petrochemical plants, etc.). Investments in renewable energy are also increasing to achieve a low carbon society. To answer these needs, Hitachi Hi-Rel Power Electronics (HHPE) has been established to provide products which allow stable operations and electrical power savings for large-sized factories. Hitachi has also established Hitachi NeST Control Systems (HNC). This company will contribute to engineering control systems, production, local adjustments and maintenance thoroughly, targeted mainly at thermal power plants. In information and control technologies, these two companies will answer increasing customer needs.

Hitachi India, Information and Control Systems (HIL-ICS) Smart grids for smart cities Railway traffic management Intelligent water systems Information control platforms

Hitachi NeST Control Systems (HNC) Control systems integration Local maintenance for thermal plants Hitachi India Pvt. Ltd. http://www.hitachi.co.in

Cover Story Inside View

“India is a critical location for our global R&D strategy” In the course of Elecrama 2012, PWI met up with Mr Anoop Nanda, Managing Director, SEA, S Asia and Japan, Eaton Power. In a free-wheeling interview, Mr Nanda spoke about Eaton’s global strategy, the company’s focus on R&D and plans for the Indian market…

n India, as well as globally, how is Eaton Power aligned with the concept of energy efficiency? Eaton’s core purpose relates to power and the power business worldwide. In the power management space, our approach is along four dimensions – reliability, efficiency, safety and sustainability. Addressing the issue of efficiency and sustainability makes up for our core values. For example, our 9395 UPS was the first transformer-free product in the world. It is one of the highest efficiency UPSs available anywhere. It addresses load problems and provides

benefits against low power. It helps consumers do more with less power and reduce the carbon footprint to contribute to a more energy efficient environment. Our other products and services are committed to green initiatives. Most of our own buildings, especially the one in Pittsburgh, USA, are LEED certified. What is the technological edge of the 9395 UPS vis-a-vis close competitors? The mass competitive space was with transformer-based designs. Eaton, at a very early stage, went for the insulated

ENERGY MANAGEMENT: The Eaton Way The first step: energy management planning Energy management planning is a systematic approach or program to ensure the most efficient use of energy in a business, facility and/or system. Why do you need to plan for energy management? The government’s mandates are clear. Reduce overall energy use. Rely more on energy from renewable sources. Measure and manage energy use more carefully. The government and utilities strongly urge commercial and industrial enterprises to manage their energy usage. Four areas to develop an energy management plan: Strategy and planning Operational plan Execution and implementation Measurement and continuous improvement The goals and objectives can include regulatory requirements, business objectives, facility certifications, specific energy reduction targets, renewable energy integration and so on. If you perform an energy audit, it should consider technology, people and operation/ control strategies, and focus on the complete energy picture, not just the lighting or HVAC. It should look at all utilities and not just electrical consumption inside a facility. Your plans and recommendations must consider key business factors and the quality of the work environment.

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STRATEGY AND PLANNING Establish energy management vision and commitment Set energy goals and objectives (short- and long-term) Assign resources, roles and responsibility Define budget and funding strategy

OPERATIONAL PLAN Assess current state (energy audit)—identify all energy management opportunities (baseline) Use energy audit recommendations to prioritize, plan and allocate resources Create plan to engage organization and drive energy awareness (energy culture)

Strategy and planning Corporate and senior management policy

MEASUREMENT AND CONTINUOUS IMPROVEMENT Measurement and verification Knowledge management Continuous review of plan and results

EXECUTION AND IMPLEMENTATION No-cost, operating and housekeeping changes Commissioning, re-commissioning and continuous Design, install, commission upgrades and retrofits Organizational training, results and progress visible

gate bipolar transistor (IGBRT) design and modular design in transformers through our variable module management system (VMMS) technology. In case of several UPSs working together, where loading determines the efficiency, this system directs the load in such a way that the UPS is optimally loaded. Other UPS systems are not able to do this and hence, do not achieve the same level of efficiency as we can. Getting rid of transformers and moving to more efficient systems like VMMS and energy savings mode system are some of the innovations that have helped us achieve high levels of energy efficiency. What is the commitment of your power quality division towards energy efficiency? Our commitment to energy efficiency covers a holistic approach of designing, studying and auditing the system, selecting the right component and products that can give maximum efficiency. We have some of the most efficient bus way systems for load management. The

metering and monitoring products enable the customer to find out the loads which suck maximum power. We are also equipped to conduct studies on the air flow management in the context of cooling. Do you have a portfolio in smart metering? Yes, a lot of our meters are smart and they are facilitated with sophisticated software for communication. Some of them are even wireless. These meters are intelligent enough to understand how the load is behaving and how the profile is changing, pinpointing areas that need addressing, etc. So we have a very comprehensive slew of monitoring and metering products and solutions. We also undertake predictive diagnostics - an approach which can oversee a breakdown or catastrophe. Is there a presence of Eaton in the design and conceptualization of green buildings? Our focus is on power management, so

we help customers to understand how to go green. As space becomes a premium, many of our competitors have to go the SF6 way, which allows a smaller footprint. But, Eaton is committed against SF6 –based design and we do not use the technology in any of our products. This is because it is a notoriously potent greenhouse gas emitter. We have invested largely in the R&D, which has enabled us to come up with medium voltage switchgear which is SF6-free. This is yet another example of our commitment to promote green. Is there an India-specific R&D initiative that Eaton is undertaking? India includes five manufacturing locations and 2,300 employees, out of which a large number is engaged in services related to R&D and IT. So, for us, India is definitely an important location for our global R&D strategy. It will continue to be a driver for wealth in emerging markets. By 2015, we expect to generate revenue to the tune of 30 per cent from emerging markets and India’s share will be around $500 million.

SOME EATON PRODUCTS AND SOLUTIONS 9395 UPS A double conversion UPS providing premium power performance Double conversion provides the highest level of protection available by isolating the output power from all input anomalies. With a transformer-free design and sophisticated sensing and control circuitry, the 9395 UPS delivers an efficiency of up to 94.5%. Variable Module Management System (VMMS) optimises system efficiency at low load levels and Energy Saver System (ESS) allows dramatic increase in UPS efficiency without sacrificing load protection. The 9395 is a completely integrated system that incorporates power modules and system switchgear on factory pre-wired bases. The design requires 50-80% less energy in manufacturing due to less energy needed for testing. Pre-wired configuration reduces cabling bus bar costs and installation time.

SF6-FREE SWITCHGEAR FOR MEDIUM VOLTAGE SYSTEMS Commitment to green Eaton’s medium voltage switchgear systems are based on the use of vacuum switches combined with solid insulation material. This is an environmentally friendly technology compared to methods that use SF6 as an insulation gas. Due to a growing concern about the impact of global warming, several utilities and Eaton are joined in the Green Switching initiative. Green Switching is a platform of users, manufacturers, non-governmental organizations and other participants who are concerned about the growing use of SF6 for MV applications. The participants share the idea that the use of SF6 should be prevented wherever there are alternatives available on the market.

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Regulatory Watch

The Findings of Shunglu Report on Power Discoms

he much-awaited highlevel Shunglu Committee report has been released in December 2011. In view of a whopping loss of Rs 1,79,000 incurred by the power distribution companies during 2006-10, the high level committee has called for an urgent financial restructuring to revive their fortunes. The report has made a detailed recommendations on improving the financial health of power distribution companies (discoms), including regular rates review, management rejig and a creation of special purpose vehicle (SPV) to absorb their losses. “During the five years (from 2006 to 2010), losses were Rs 1,79,000 crore before subsidy and Rs 82,000 crore after subsidy. These losses were primarily because of the gap of about 0.60/kwh between average cost and average revenue,” the panel said in its report. The panel has attributed these losses to the poor managerial and operational practices of distribution companies compounded by irrational tariffs fixed by regulators. “From the study and analysis of the tariff orders, it is observed that inadequacies and distrortions in tariffs have been caused by regulators, utilites and indeed the state goverments,” noted the commission. According to the panel, headed by former Comptroller and Auditor General 46• PowerWatch INDIA

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VK Shunglu, the time for immediate radical action is now and soft options are no longer available. The panel has closely looked into the functioning of the State Electricity Regulatory Commissions (SERCs) and found them influenced by the state governments in the lack of financial freedom, which hampers them in properly discharging their duties. Taking cognizance of this situation, the panel has proposed to form an expert group to scrutinize the functioning of SERCs in order to determine to what extent the commissions has discharged their statutory duties like timely and regular revision of tariffs. The State Regulatory Commissions need to be made independent financially as well as in their functioning and the selection procedure of their members and Chairman also needs to be fine tuned. Noting the instances where state government has pressurized or influenced regulatory functions, the panel has suggested the Planning Commission to monitor the efforts of state governments as well as government owned/controlled utilites for effectively reforming the power sector. For this, the report has suggested to have a forum for annual plan discussion. The report has recognized that the reduction of T&D losses is an important element of the reform agenda. To which,

February 2012

the government support in checking the power theft has been lukewarm. For tariff calculation, presently most of the regulators pool all lossess together, while in some areas losses are very high and in some areas, they are modest, mainly due to the substantial variation in commercial losses. This practice of polling all losses should be avoided. The panel has suggested that in areas where losses are high, a loss surcharge should be imposed over and above the basic tariff, mentioned in a report. The report has also taken a note of the practice of regulatory commissions to convert the uncovered gap into the regulatory assests to avoid the tariff shocks. This accounting jugglery results in serious liquidity problems for the distribution companies. This practice has assumed alarming proportions and in some states the total value of regulatory assets has gone up to totally unacceptable levels. Losses of discoms have been financed by commercial banks substantially and a large part of such loans have been guaranteed by the State Governments. The Report has suggested that these loans could be suitably rescheduled. In case of failure to meet the rescheduled obligations, such assets should be taken away from the banks and placed with the Special Purpose Vehicle (SPV) to be set up for the purpose. The SPV should be owned by the Reserve Bank of India and shall be empowered to suitably deal with the defaulting utilities/State Governments including debiting of State Government accounts. Some other important recommendations include introducing input based franchise models in about 255 more towns as listed in the Report, cautious use of Section 108 of the Electricity Act, 2003 relating to issue of Policy directions and proper energy accounting of allconsumers.

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Regulatory Watch

A Case for Distribution Franchisee By Umesh Agrawal

he Electricity Act 2003 and the concomitant policies have brought about a fundamental change in the power sector in the last decade, witnessing a number of successful initiatives. Reforms have made major progress in terms of unbundling and corporatization of state-owned enterprises; emergence of private independent power producers, independent power transmission companies and power exchanges. The trifurcation of the former state electricity boards has made distribution of electricity into a separate activity, thereby bringing accountability in the system. Still, reform remains incomplete. 48â&#x20AC;˘ PowerWatch INDIA

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Unreliable services are hampering agriculture, industry and penalizing households with large welfare losses. The recent Shunglu Committee report provides an in-depth analysis of the electricity distribution sector from various perspectives and lays down the roadmap for recovery of the sector. Government has initiated several schemes; but progress is slow The Government of India is facilitating expansion of distribution networks and efficiency improvement through its flagship programmes - Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) and Re-structured Accelerated Power Development Reforms Programme (R-

February 2012

APDRP) respectively. RGGVY aims for 100% rural electrification. R-APDRP intends to introduce IT based platform to manage all functions of distribution companies, to start with, in urban areas which contributes to around 40% of energy consumption in the country. However, the progress of R-APDRP in most of the states is slow, particularly in the areas of installation of central server, GIS consumer survey, asset mapping and base level loss determination. Utilities have completed metering of all their 11 kV feeders but distribution transformer metering is behind the schedule. As a result the envisaged performance improvement from implementation of R-APDRP has not become visible as yet. Financial health of distribution utilities are raising concerns for the sector Financially healthy distribution entities are critical foundation of the power sector. Despite several enabling provisions to bring about competition in electricity distribution, it still remains the monopoly of state owned utilities. As per Shunglu Committee report, the aggregate loss of all the electricity utilities for the period 2005 to 2010 is estimated at about Rs 82,000 crore. Further, the aggregate technical and

commercial (AT&C) losses stand at around 30% in volumetric terms. Much of the losses are commercial in nature. This indicates that they not only have a high level of outstanding financial loss but also continue to incur losses on account of operational inefficiency. Nationwide around 20 million connections are served through old electro-mechanical meters which have tendency to become slower by 2030% with time. Moreover, connections related to agriculture pump sets and street lighting/ traffic signaling are yet to be provided with meters. Utilities have been irregular in reading meter especially in rural areas. Further, utilities tend to hide operational inefficiencies and thefts in agriculture consumption to show better AT&C losses. These factors have drained the financial viability of the distribution business and resulted in unavoidable but non-transparent cross-subsidization. Distribution of electricity is an extremely people centric activity, and by this very nature, it has unfortunately been a politicallysensitive issue. Political intervention in setting of tariffs is also responsible for the financial health of the utilities. Revenue sustainability is an imperative requirement for running an electricity distribution network. This requires reduction of AT&C losses to minimum feasible levels. Loss reduction requires managerial efficiency, substantial capital expenditure and expeditious actions on both these fronts. Systematic participation from the private sector is inevitable. The private sector participation is being attempted in two ways. The first is the controlling stake sale of a governmentowned utility to private sector entities; and the second is through appointment of a private distribution franchisee, particularly for loss making circles. We

have witnessed significant resistance and limited success in the prevailing environment for sale of controlling stake in distribution utilities; while there have been a number of success stories for distribution franchisee approach. Distribution franchisee is a win-win situation for all stakeholders With commercially and technically efficient operations, distribution franchisee can be at a rescue for utilities with pockets of operational inefficiencies. It would be able to turn around the distribution business in urban areas in a short span of time. Distribution Franchisee appointment in at least of loss-making

the licensee at pre-decided input rates. This input rate is arrived at through a competitive bidding process to seek higher revenue for the licensee. The input rate is based on the AT&C loss reduction trajectory considered during the contract period. Licenseeâ&#x20AC;&#x2122;s revenue is indexed to tariff changes. The franchisee benefits financially if it is able to reduce losses over and above the trajectory and suffers if it fails to do so. This model is adopted to bring in a certain amount of fixed revenue from urban circle(s), which are otherwise marked by poor collection efficiency. The model ensures that a fixed income is generated for the distribution licensee at no additional cost. In sum,

As per Shunglu Committee recommendations at least 255 towns (including peripheral areas) should be appointed a franchisee as they are likely to account for over 40% of the national consumption. circles to begin with, could precipitate a potential turnaround process. They can be categorized based on total electricity load of that area, its spatial distribution and their potential to reduce losses. As per Shunglu Committee recommendations at least 255 towns (including peripheral areas) should be appointed a franchisee as they are likely to account for over 40% of the national consumption. Distribution Franchisee can pull such regions to the optimum performance levels through its focused attention and concerted efforts. Under Input based Franchisee model, the franchisee undertakes operations and maintenance of the existing distribution network while carrying out the commercial activities of metering, billing, and collection. Besides, the franchisee is allowed to undertake capital expenditure in the supply area. Further, the franchisee receives electricity from

except for the transfer of ownership, it is the full service franchisee which operates as a distribution licensee in the area. In Maharashtra, Torrent Power was appointed as a franchisee for Bhiwandi circle in 2007. It has brought down distribution losses from 46% to 19% and improved collection efficiency from 86% to 100% during a short period of three years through various initiatives, such as, strengthening distribution systems; improving metering infrastructure; and improve repair and maintenance practices. With the experience of Bhiwandi, Maharashtra State Electricity Distribution Company Limited has gone ahead and implemented distribution franchisees at Nagpur, Aurangabad and Jalgaon. The graph depicts the estimated savings to the utility beyond the benchmark set in the bidding process. It will be

February 2012

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PowerWatch INDIA

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Regulatory Watch worthwhile to note that benchmarks itself were designed considering aggressive performance improvements. The performance of the distribution franchisee for Agra in Uttar Pradesh has also been encouraging in terms of loss reduction and consumer service as per various reports. As brought out in the various distribution franchisees implemented so far, it is a win-win solution for all the stakeholders – customers, employees, utilities and investors. Distribution franchisee improves quality and availability of power and better services to the consumers. Surveillance and quality of governance

Maharashtra Experience In Maharashtra, Torrent Power was appointed as a franchisee for Bhiwandi circle in 2007. It has brought down distribution losses from 46% to 19% and improved collection efficiency from 86% to 100% during a short period of three years through various initiatives, such as, strengthening distribution systems; improving metering infrastructure; and improve repair and maintenance practices 50• PowerWatch INDIA

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Estimated savings beyond benchmarks

improves as most of the Distribution Franchisees have focussed attention on a smaller area of operation and are able to bring in technology intervention for improved customer service. Distribution franchisee faces lower regulatory risks like revision or nonrevision of consumer tariff, which tends to affect a distribution licensee. The franchisee generates profit only through improved technical and operational performance, in terms of loss reduction and improved collection efficiency. Hence, technical efficiency is inherently built in distribution franchisee. Large part of the licensee’s benefit comes from the reduction in AT&C losses and avoided costs in the franchised area especially in initial years. In privatization, there are limited parties with necessary financial resources for the upfront investments to meet pre-qualification criteria. This leads to limited competition in selection process. Whereas distribution franchisee provides opportunity to those in power/ infra/ service industry and it results in more transparent and rigorously competitive selection process leading to better value for the utilities and the consumers. Looking at the operational freedom

February 2012

and virtually no initial equity investment in acquisition, the model has been able to attract private equity resources. Access to private equity resources enables it to scale up. Even after such a win-win situation; and enabling environment for growth of distribution franchisees, there has been limited growth in number of successful transactions on account of a mix of inertia and structural issues that state owned utilities are facing while attracting private investors in distribution segment. Considering the present health of distribution segment affecting development of power sector in India, utilities can no longer afford a status quo with their current cost and quality of service to the consumers. In such situation, quick breather through distribution franchisee mechanism is more of necessity than a choice. It will not only improve services but would also address issues like paucity of financial and human resources, high AT&C losses to mention a few. It will prove as a grooming ground for budding players in electricity distribution who will play a significant role in envisioned full-fledged competition in the power sector. (The writer is Associate Director – Energy, Utilities & Mining, PwC)

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Regulatory Watch

“Reducing T&D losses has more to do with political will than technology” PWI met up with Mr Sambitosh Mohapatra, Executive Director, PricewaterhouseCoopers, to discuss the state of the transmission and distribution sector, the recent Shunglu report’s recommendations, and the way ahead for the sector. Excerpts from this interview follow…

hat is your take on the feasibility of the domestic equipment industr y primarily in the T&D space? The first report we did was for IEEMA where we made ten-year projections and technology trends on various equipment such as switch gear, transformers and meters. During that period, we had an extensive interaction with equipment manufacturers, where we came to the conclusion that 52• PowerWatch INDIA

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technology and adoption of technology were never recognized in India. But, if you bring technology from outside, the ability of Indian manufacturers to adopt that technology was always there. Huge interest has been shown by MNCs like Toshiba and Hitachi in venturing into the Indian space for specific equipment like the ones designed for specific voltage levels or supercritical or ultra-supercritical. These multinationals have shown greater interest in entering into a joint venture with Indian players. But, of late, it has been noticed that such

February 2012

partnerships don’t necessarily enable the transfer of technology. When these companies talk about their India targets, they want to have a controlling stake of about 74 per cent for these technology transfers to happen. On the other hand, these are companies who are not in the technology space at all, but now has interest in getting into this space. In fact, companies which are operating in India as foreign entities like GE, have gone India-specific in the latter half of this decade. These developments suggest that the companies across the world are getting India focussed. They are coming to India and technology is also not getting into the way of their plans. I can confirm this; at least for the electrical business. From the technology and equipment point of view, there is a stark need to bring down the T&D losses to more controllable levels in the current T&D framework of the country. What is the necessary technology interventions required to make this happen? I don’t see that there is a constraint of technology here – neither in any information technology or hardware technology. Reducing the T&D losses

is more to do with political will, other than anything else. There is a need to resolve people related issues, which means if I look at external stimulus, in majority of the SEBs, there is an aged workforce; most of the people are in the age bracket of 42-62. Even if you bring the best of the technology, how will this technology get absorbed in such an organization? The capex of these technologies may be the one element in the reduction of T&D losses in the country, more than that it is the institutional governance and people related issues, and of course, the regulatory issue, that are aggravating the situation. The Shunglu Committee report is out and the recommendations have been made to reduce the T&D losses in the Indian power distribution business. Do you see that the recommendations suggested in the Shunglu Committee report will actually set the ball rolling? Most of the state governments have already taken structural reforms where state electricity boards (SEBs) were restructured. Post 2003, the SEBs were divided into three or four entities – generation, transmission and distribution. Then came EA 2003 that suggested bifurcation of SEBs in mainly two entities - distribution as one and keeping generation and transmission together as another. Thus post 2003, utilities started complying by what was mentioned in EA 2003. So, basically what I am trying to say is that the utilities are merely providing lip service by complying with the policies made by the government, but no honest effort has been made to actually reform the electricity distribution business.

The Shunglu Committee report has talked a lot on the part of the regulator. I believe, first of all, the regulator has to agree to the actual loss levels. Currently, what is happening is that if the actual loss level is 40 per cent, the regulator accepts only 35 per cent and passes on the judgement on the basis of that. Then comes the factor like if people are not giving information and suo moto judgements are holding it back or whether the fuel adjustment costs need to be passed on to the consumer. But it is great to read that the report has emphasised on the independent working of regulators and suggestions are made on the evaluation that needs to be carried out on the performance of the regulator. Gujarat’s power sector reform process has been very effective with 2 per cent year-on-year tariff hike to domestic consumer, 5 per cent yearon-year to industrial consumers. Along with it, there is time-of-theday (ToD) metering for agricultural consumers. What is your take on this model? The Gujarat reform model is very good. There used to be a misuse of segregation – who has consume how much. Generally, rural consumers are also on the same feeder on which agricultural consumers are operating. Because of which, the quality of the supply for rural consumers gets affected. So there needs a split in feeders. In Gujarat, what is happening is that the segments of agricultural and rural consumers are put on separate feeders, which help rural consumers in getting 24-hr power supply and agricultural consumers get 6-8 hr power supply. So the quality of power supply has boomed and the rural economy

started contributing in overall growth of the economy. I am sure, lot of other states are doing the same – splitting the feeders for agriculture and rural consumers. In Gujarat, while implementing this model, no clear protests came into notice at any level – be it the rural consumer, semi-urban or urban. The sensitization exercise was also very effectively carried out. Your comments on this? Yes, definitely the model has proved a win-win for all. At no level, there was a deteriorationofpolicyguidelines.Inspired by this example, other states are also motivated to follow suit. Now, Haryana is doing it. Andhra is also contemplating implementing this model. Whereas Gujarat is pretty happy with the year-on-year tariff revision system, few Delhi discoms want to pass on the loss burden to the consumer in one go. What do you think is the right move? Which one would be more effective in addressing discoms’ woes? The debate should be on what is the right amount of tariff hike because, in my view, no state has the capacity to undertake such a study. Have you ever seen any study that states, this consumer is ready to pay this much amount for electricity? I still remember a few years back, people used to say that even a 5 per cent hike in power tariff in Delhi will make people’s lives miserable. Last year witnessed a 22 per cent power tariff hike! In fact, when I speak to Delhi people, they are ready to pay if they get 24/7 uninterrupted power supply. Even rural consumers pay much more for one unit of power than their urban counterparts.

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PowerWatch INDIA

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Money Matters

riven by the will to harness India’s massive solar potential, Solairedirect Energy India is planning to invest nearly Rs. 4,000 crore for funding its target of becoming a 400 MW company in the next five years. On sourcing of funds, Mr. Gaurav Sood, MD, Solairedirect Energy India said it would be a combination of debt and equity, the ratio of which is expected to be around 75:25. However, it may vary depending upon the project financials, cost of debt and cost of equity. The solar power producer is a subsidiary of the French solar major Solairedirect, which entered the country last year, and provides end-to-end solar energy solutions for turnkey projects, including project development and engineering, construction and installation, financing, operation and maintenance. To achieve the 400 MW target, the company will be signing PPA’s under national and various state programmes.

However, according to Mr. Sood, major part of the growth would come by signing private PPAs with bankable off-takers outside these programmes. He informed that the company is already working on signing these private PPAs with corporate and large bankable off-takers. “We are in discussion with leading corporates and large energy users to supply them competitive solar power over a long period of time,” he told PWI. Having established a successful business model in France, as an integrated player in the upstream value chain of the photovoltaic (PV) market, the company is all set to strengthen its roots in India. Solairedirect has already won a 5 MW project in Rajasthan, under the Jawaharlal Nehru National Solar Mission ( JNNSM). The company bagged the order with an offered tariff of as low as Rs 7.49/ unit. The company explained that the secret to quoting such a low tariff was due to its bankable EPC contracts, best in class components, lowest possible

French betting big on India’s Solar Potential

regulatory risk, etc. This not only resulted in mitigating risks, but also lowering the return expectations of our investors. It is a major step towards building large scale solar power plants, supplying competitive solar power in the country. The Rajasthan project will be operational by December 2012 and Solairedirect will be using its expertise of designing, building and operating more than 120 MW projects in France. It will set up a state-of- the-art project in India using crystalline technology.

BANKING ON SOLAR POTENTIAL IN INDIA India, as a tropical country, where sunshine is available for longer hours per day and in great intensity, is being seen as one of the most promising market for investing in solar technology. Though, it is currently costlier than other sources of power such as coal, the JNNSM aims to overcome the barrier sooner than later. The mission is a major initiative of the government of India and state governments to promote ecologically sustainable growth, while addressing India’s energy security challenge. The objective of the mission is to achieve 20,000 MW power-generating capacity by 2022, and create conditions through rapid scale-up of capacity and technological innovation to drive down cost towards grid parity. It anticipates achieving grid parity by 2022 and parity with coal-based thermal power by 2030.

Indian subsidiary of French major, Solairedirect plans to invest AREA OF EXPERTISE Rs 4,000 crore to become Solairedirect has created a niche in 400 MW company in photovoltaic installations, which includes next 5 years... solar parks and rooftops. The company has

shown expertise in the design, production and operation of solar PV rooftops, both for private houses and large industrial buildings. It is also involved in providing building and operating solutions. As

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February 2012

Solairedirect: Role across key phases PHASE

ROLE

PRE-CONSTRUCTION

CONSTRUCTION

OPERATION

an Independent Power Producer (IPP), Solairedirect undertakes power purchase agreements (PPAs), for offering competitive KWh price in the long run. As a provider of turnkey solar farms, the company’s Engineering, Procurement and Construction (EPC) services include: Engineering assessment (validating designs) and selecting contractors Handling grid connection procedures Executing the construction plan according to a fixed price

KEY FEATURES

Feasibility analysis Drafting technical offer

Mandated as sole EPC contractor Carries out detailed engineering Drafting of all tender documents & sub-contractors selection Site work & installation of PV modules Testing & commissioning

Preventive & corrective maintenance scheme facility management during operations Guaranteed technical availability rate (98%) Guaranteed performance ratio

Supervising

testing and commissioning procedures Providing comprehensive set of guarantees (penalties, price adjustment mechanism, equipment guarantees) and taking out insurance

THE ROAD AHEAD As an Independent Power Producer (IPP), Solairedirect aims to provide competitive kWh to the customers and strive to be amongst the leading solar PV IPPs in the

In-house competencies Third party support when required

Fixed price turnkey EPC contract Comprehensive set of guarantees Module performance guarantee Comprehensive insurance

Construction-operation contract (first 2 years) O&M contract (3 to 25 years) Comprehensive set of guarantees & insurance policies

country over the long term. The short-term goals encapsulate successfully building the initial projects and creating a portfolio of 300 to 400 MW solar PV projects in the country. The company will be working towards offering competitive solar power to private customers and providing bankable EPC services to companies and partner with them to build long-lasting energy assets. Monica Chaturvedi Charna Write to us with your feedback at pwi@nextgenpublishing.net

Solairedirect Value Chain Modules

Integration

Project Development

Financing

Installation

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Operation

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Power Sales

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Money Matters

Interview with

Gaurav Sood

MD, Solairedirect Energy India speaks about plans of becoming a 400 MW company in the solar realm...

ow is Solairedirect Energy India working towards becoming a 400 MW company in India in the next five

years? Solairedirect will be signing PPAs under the national and different state programmes. But, the major part of its growth would come by signing private PPAs with bankable off-takers outside these programmes. We are in discussion with leading corporates and large energy users to supply them competitive solar power over a long period of time. What will be the breakup of Rs. 4,000 crore investment in terms of equity and debt, and how will it be raised? Ideally the debt-equity ratio should be around 75:25. But depending upon project financials and most importantly, cost of debt and cost of equity, this ratio would vary. Equity will be raised from long-term institutional domestic/foreign investors and debt will be raised from local banks in India. The company is offering to sell solar power to the grid at a very low price of Rs.7.49/kWh. How will this be practical for the company’s own profitability? Cost of financing is the biggest contributor to the cost of kWh. If a company is able to lower its cost of financing by choosing the 56• PowerWatch INDIA

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right set of investors, lower tariffs which are definitely more bankable, become very profitable as well. This is our approach towards our projects – making them highly bankable by mitigating all risks i.e. having bankable EPC contracts, best-in-class components, lowest possible regulatory risk, etc. and in the process lowering the return expectations of our investors. This leads to building large scale solar power plants supplying competitive solar power. According to you, what should be the agenda for the government and corporates to achieve 20 GW of solar power by 2022, under the Jawaharlal Nehru National Solar Mission ( JNNSM)? The price at which solar power is available today, the target of 20GW by 2022 will be surpassed easily. Solar power at current price levels of say INR 7.5/kWh is cheaper as compared to new coal power plants with imported coal and would provide you a hedge against increase in energy price on account of depleting fossil fuel reserves over the years. So, both government and corporate would be happy to adopt solar power as an important part of their energy mix as it is cheaper, cleaner and provides you energy independence. From the government side, support should be required on regulatory reforms and land provision for setting-up these power projects.

February 2012

Kindly shed light on the projects which the company is currently working on? Currently, the company is in the process of setting-up its first 5 MW project in Rajasthan under JNNSM. We will be bidding under the Rajasthan policy as well Gujarat policy. In addition, we are working on signing private PPAs with corporate and large bankable off-takers. By when is the 5 MW project in Rajasthan expected to become operational and which are the areas that it will cater to? The 5 MW project in Rajasthan will be operational by December 2012. Solairedirect will be using its expertise of designing, building and operating more than 120 MW projects in France and will set up a state-of-the-art project in India using crystalline technology. What are your views on the Indian manufacturers’ proposal of imposing tax on imported solar technology? As an IPP (Independent Power Producer) our aim is to provide the most competitive kWh to the customer. This goal gets defeated, if we impose taxes on imported solar technology. We are very much in favour of domestic manufacturing but what is required is to set up large scale manufacturing capacity, which can be competitive globally and helps in lowering cost of solar power rather than increasing the same.

CENTRIA products stand up to the toughest conditions in the world. With the continued growth of power generating facilities around the world, CENTRIA is committed to providing durable building solutions that stand up to and perform under the toughest conditions. Our global portfolio boasts more than 2,500 successful power industry installations that put our innovative metal cladding and roofing products and special systems to the test. Whether itâ&#x20AC;&#x2122;s a special coating system, stronger panels or our unique controlled panel release system, CENTRIA products can conquer any power industry design challenge.

We areâ&#x20AC;ŚDistinctively CENTRIA.

www.CENTRIA.com CENTRIA, US Head Office: 1005 Beaver Grade Road, Moon Township, PA 15108 USA India Representative: R.S.Rajaram, Tel: 09890446120 Email: rajaram@CENTRIA.com

Tech’tonic

ith high a v a i l a b i l i t y, reliability and reduced risks are the chief objectives of a power plant operator, outsourcing the complete operations and maintenance of the plant to the original equipment manufacturer of all major equipment can be the best solution for maximizing the plant performance... Owners of gas turbines/combined cycle power plants (GT/CCPP), need to consider carefully the best method of managing the assets associated with their investment so as to achieve the best return on investment over its expected

life. This decision is a strategic one and involves finding the most effective choice for managing the engineering together with the operations and maintenance requirements to fit the gas turbine technology, which they are planning to install. The options for asset management range from complete internal supply at one end of the spectrum to the complete outsourcing of the facility and equipment management to a specialist company at the other end. The choice of the level of outsourcing will be made primarily based on the owner’s capability, capacity and appetite for risk. When evaluating possible suppliers

of service the asset owner should consider what competencies it requires the supplier to be able to provide. The selection process should take into account many attributes that a supplier will need in order to provide the level of reliability and risk mitigation that the company will need to meet its specific strategy. A long and successful background in operation and maintenance of GT/CCPP. A strong record of delivering cost effective results with high availability and reliability. Cost effectiveness in this context should be measured in terms of value produced for the money invested and should take into

How to select right OEM contractor Flexible operation and maintenance contracts are an effective solution for optimum asset management of combined cycle facilities...

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account the ability of the supplier to maintain the value of the plant over a long period of time. An in-depth technical knowledge of all plant components. This should preferably include engineering expertise in the design and maintenance requirements of all key components. World-class O&M business systems, which may be customised for use in the specific environment of the combined-cycle facility. Examples include computerised maintenance management systems (CMMS), safety permitting systems, RAM data collection and real time remote monitoring of key equipment with expert support on a 24-hour sevenday schedule. Systems above coupled with a welldeveloped and consistent maintenance strategy that is specific to gas turbines and combined cycle power stations. A strategy that is built on reliability principles for both operations and maintenance and incorporates all of the critical plant equipment, not just the combustion turbine and heat recover systems. Ability to supply, support and evaluate key condition based monitoring programs. Access to skilled staff to provide the knowledge base for the facility and it must be able to train new recruits in an efficient method. The ability to provide plant and efficiency improvement proposals to adapt to continually evolving turbine and combined cycle plant technology. Expertise in project management and project development for all areas of the facility. Excellence in the management of health, safety and environmental systems and a strong EHS performance

record and preferably ISO14001 and OSHAS18001 certification. Adequate legal compliance systems established to reduce the risk potential for the owner. As O&M type contracts represent long-term partnership arrangements it is important that the owner and supplier maintain common goals and incentives throughout the life of agreement. This can often be accomplished through the use of incentive based contracts where some form of bonus/penalty clause can help motivate both partners towards common goals such as highest possible reliability and availability. This is a form of risk sharing that also allows the owner to evaluate their O&M partner over time and can be an important part of the selection process. The supplier should be able to provide flexible guarantees that align with the customerâ&#x20AC;&#x2122;s key business drivers. Benefits of having the OEM of all major plant components as your Operation & Maintenance partner It is the role of the O&M supplier to access expert engineering support for complex and difficult issues regarding plant components. With advanced technology this support should include the ability to perform assessment on the technical integrity of the existing equipment as well as use fleet knowledge and detailed design understanding to manage parts configuration for the best optimal performance. The original equipment manufacturers (OEM) will often have within their organisations this expertise for equipment that they supply. They can in many cases provide contract

services for the maintenance or even full or partial O&M type contracts. Those OEMs who are capable to supply all major plant components and integrate them into turnkey plant solutions will certainly have the best knowledge to provide full O&M type contracts. This can be a good option for a customer, as it will provide assurance that the company that is entrusted with the asset management of their facility also has the expert knowledge of all major components and their interaction within the plant. As a leading supplier of energy equipment Alstom has made a significant commitment to the development of specific O&M services for plants using its gas turbine and combined cycle equipment. With more than 20 years of power station management experience Alstom has developed a complete portfolio of O&M contracts with over 70 active and committed contracts worldwide. These contracts cover a full range of services and risk sharing arrangements with customers ranging from the provision of only maintenance on main machine sets up to full operation and maintenance of complete plants. To be able to provide consistent high quality across this diverse portfolio, Alstom Power O&M has invested in the development of specific solutions to address the complex business of providing this full range of O&M services. Where it provides full operations and maintenance, these solutions are collectively known as generation systems.

GENERATION SYSTEMS Generation systems represent the core power station management competences of Alstom Power O&M

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â&#x20AC;˘

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Tech’tonic Generation (Operation and maintenance) Continous Improvement Condition Monitoring Stores & Procurement

Cross dept. Cooperation

Tools/ Infrastructure

Root Cause/ FMEA/RCM

Planning/ Scheduling

System / Equipment Strategies and Plans can be imagined as a series of blocks of a pyramid as shown in the table: The foundation of the whole system is represented by basic functions whereas each successive layer represents systems with increasing level of maturity and technical advancement.

EQUIPMENT PLAN AND STRATEGY Due to inherent inefficiencies, reactive work generates typically 24 times higher costs and manpower requirement than planned work. Keeping down the amount of reactive work therefore leaves more time to focus on other value added initiatives. It is therefore one of the primary objectives of a successful strategy to minimize fire fighting activities by means of proactive system equipment strategies. With the largest installed base of power generation equipment, Alstom has in-house expertise for all major plant components, including gas and steam turbines, heat recovery units and environmental systems. Because Alstom Power O&M has direct 60• PowerWatch INDIA

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Staff/ Knowledge Staff/ Knowledge

access to this expertise for support, problem solving and improvement suggestions, it leverages this basic information in the development of equipment strategies. This technical know-how is further augmented through operational fleet experience with similar type of equipment. Building on the fundamental equipment knowledge, experienced engineers and plant personnel need to assess the equipment in the context of its operational role and configuration to determine its criticality for the whole power generation process. Based on the criticality, a maintenance strategy is developed to maximize the power plant’s reliability and performance.

STORES AND PROCUREMENT This is the largest maintenance support function contributing to effective and efficient maintenance. It is important to find the optimum service level (percentage of material requests that can be served immediately) for cost effective plant management. If this level is too low or if there is too

February 2012

much inefficiency in the store and procurement processes, operation and maintenance staff will make personal stockpiles or look for “in official” procurement channels. Other important considerations are the storage quality, store replenishment procedures and easy location and retrieval. Because of its linkages to many facilities as well as its position in the heart of the larger Alstom organization, Alstom Power O&M can facilitate improved selection and control of spare parts for a customer’s facility. These improvements include: a) the ability to better assess the risk mitigation needs provided through the proper selection of initial spares resulting from a criticality analysis, b) the ability to use a fleet wide evaluation of the spares usage to come up with a better selection strategy, and c) the ability to locate needed material in case of emergency from a pooling of some critical components. Alstom uses a computerized maintenance management system (CMMS) for a seamless management of all parts on a customer site. Stores service levels are optimized through the ability to access some critical components in emergency situations from Alstom’s centralized emergency stock or by pooling of parts with other Alstom Power O&M facilities. Spare parts levels are evaluated through the application of criticality analysis of the equipment and through analysis of equipment history provided from the stores usage rates, CMMS history and fleet experience. This allows adjustments of the stores levels to provide the owner with an optimized inventory level for cost versus risk levels.

TOOLS AND INFRASTRUCTURE Tools and infrastructure must be professional and complete, but also not excessive: If the tools’ maintenance costs are higher than the corresponding rental costs or the costs for outsourcing the associated activity, then they should not be owned. As well as being able to recommend and supply tools for use at a power station based on its own fleet experience, Alstom Power O&M also has access to specialized OEM tools from the central tool management system. These specialized tools are in many cases proprietary in nature and developed for specific applications on the main machine sets. Therefore, the ability to source and use these tools provides value to the owner in terms of reduced down time. Because of the experience gained across a broad fleet of units Alstom is able to continuously review and improve its specialised tool design and access methods.

PLANNING AND SCHEDULING Proper organization of all activities is only possible if the basic generation systems are well implemented. Planning, scheduling and controlling of maintenance activities require a structured approach in order to be able to execute the works required by the equipment plan or by unexpected events, in an efficient way. The primary tool for this is the CMMS. Effective set up and management of the CMMS facilitates the management of the plant’s maintenance work processes, work planning, resource coordination and the control of materials in an efficient manner. It also creates the ability to record equipment lifecycle

operations and maintenance history. Alstom Power O&M provides tools to its power station staff to quickly identify their planning performance and ability to manage proactive maintenance programs. Furthermore Alstom O&M has developed tools to maintain key performance indicators (KPIs) for CMMS functions across all plants where it has maintenance management functions. The power station team can use the feedback from these KPIs to assess its performance for continuous improvement.

STAFF AND KNOWLEDGE In the end it is the people and their knowledge that makes things happen on the plant. But people come and go and technology also evolves at a rapid pace, so knowledge needs to be maintained and improved. When Alstom sets up an O&M service at a customer facility it uses several methods to quickly bring people up to a high level of competence. The first is to use internal transfers as a method to bring in experienced people from the OEM commissioning group or other plants into key positions, the second is to provide comprehensive specific training programs for the plant equipment and the third is to provide ongoing training and development based on its worldwide training requirement concept. As well as providing proven means to improve the plant staff knowledge Alstom O&M maintains close relationships with the OEM engineering services and plant support centre to reduce the need for the developer to invest in expert support engineering on-site. Training is an important success factor in this area: For ongoing development Alstom uses its internal training and

development programs to improve staff knowledge and to instruct new employees. This is managed through the use of a universally implemented learning management system (LMS) through which standard training packages can be defined and delivered. As well as the required courses developed by Alstom this system is also used to define and keep track of local legal requirements and locally procured technical training. Additional specialized technical training is provided through the Alstom service-training centre for inspection maintenance tasks.

CONDITION MONITORING Maintenance based on the actual condition of the equipment is the most effective way of maintenance, provided that there is a condition monitoring technique that is effective and efficient. Alstom utilizes several methods for condition monitoring at the power stations where it provides full maintenance services. The first main system is provided through a continuous monitoring of the main equipment remotely through the use of Alstom’s AMODIS® system that allows the central Alstom Plant Support Center to monitor the key characteristics of the equipment and through use of analysis techniques detect changes in parameters and issue early warnings to the plant operators. For balance of plant equipments, which may not have such remote monitoring, Alstom Power O&M has implemented condition monitoring based on its own proactive maintenance concepts. These concepts include techniques like

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Tech’tonic thermography, vibration monitoring, ultrasonic measurements and lubricant analysis. These techniques allow Alstom staff at the plant, supported by expert engineers in the head office, to determine the state of components while on load and schedule a repair during a low period. This results in reduced maintenance costs.

CROSS-DEPARTMENTAL COOPERATION This function is about redistributing work to the organizational unit that is most suited to perform this work (e.g. some maintenance tasks are done by operations staff ) or working together where synergies are to be expected (e.g. joint troubleshooting). Organizational objectives must be set up in a way that operations and maintenance don’t act as separate silos, but share common objectives. If this is the case, it is easier to benefit from the natural synergies that exist between both teams. Alstom Power O&M’s plant management philosophy encourages the development of crossdepartmental cooperation by implementing flat organizational structures, cross-department and trade problem coordination meetings, work planning, and problem solving.

ROOT CAUSE ANALYSIS (RCA) / RCM At this stage of maturity, the maintenance organization is not fire fighting anymore. Savings therefore don’t come from increased labor productivity, but from eliminating ineffective tasks or adding important tasks. Understanding what is the root cause of a problem is a good 62• PowerWatch INDIA

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basis for selecting durable measures. This requires an understanding of the operating dynamics of the equipment in order to be able to identify the possible component failures and all the consequences. It is also important to understand maintenance techniques available to prevent or detect a failure timely. Because of these complexities, RCA or RCM needs to be undertaken by an experienced team, since no individual can cover all required aspects. Complex problems that occasionally occur at power stations are reviewed both by experts at the station and also through the use of technical event reports engineering support from the lead centre. Where such problems require more in-depth analysis and expert review a task force may be put together to review all similar situations across the fleet so as to make universal plant improvements or recommendations. Fleet experience is collected through a consolidation of fleet CMMS data and the use of RAM data using standard codes. This standardization of information allows Alstom to use tools such as criticality analysis, FMEA and reliability trends in equipment to identify key improvement areas and optimize the maintenance concepts over time.

CONTINUOUS IMPROVEMENT Alstom has developed a plant O&M assessment tool to encourage continuous improvement of the O&M management at a power plant. It is an effective way to benchmark the O&M process in order to be able to identify improvement areas, share best

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practices and continuously increase the level of organizational knowledge within the company. The assessment process allows the benchmarking of the O&M performance of a particular plant against company standards and industry best practices. At the same time, the process is set up in a way that it increases organizational knowledge and identifies the most effective improvement measures, based on the collective knowledge of the company.

CONCLUSION Full operation and maintenance contracts covering the complete combined cycle power plant play an important role for the successful execution of power generation ventures, particularly for project developers whose core competence does not involve operation and maintenance of power plants in general or at a particular location due to missing local infrastructure and resources. The core power station management competences of an O&M services provider are embedded in the development and successful application of the O&M management system. With these value-creating systems, both the global O&M experience from multiple sites and the OEM know-how from being a supplier of major plant components and turnkey EPC provider are leveraged. A full operation and maintenance contract provided by an experienced O&M services provider with broad in-house OEM technical expertise will contribute to achieve optimal dispatch and highest availability and performance levels of the power generation assets. (The article is contributed by Alstom) Write to us with your feedback at pwi@nextgenpublishing.net

Tech’tonic

Impact of High Pressure and Intermediate Pressure Turbine Configuration on large fossil steam turbine performance By Richard E. Kehl, GE

verall efficiency entitlement for a steam turbine in a power plant is dependent on the thermodynamic conditions of the steam from the boiler. The steam turbine can be configured in a variety of ways and a variety of technologies can be implemented to most efficiently convert the steam into torque that through a generator produces electric power. The typical thermodynamic cycle for a large fossil steam turbine is called a reheat steam cycle. A reheat steam cycle brings high pressure exhaust steam back into the boiler after partial work 64• PowerWatch INDIA

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extraction, for heating back up to boiler temperatures. This allows for additional work extraction and a more efficient cycle. In addition, in this type of plant, steam is extracted from the turbine to feed a series of heat exchangers (feed water heaters) that heat the water prior to entering the boiler. This additional use of thermal energy improves the overall efficiency of the power plant. Thermodynamic conditions of the steam delivered to the turbine are typically categorized by their temperature and pressure into three classifications: subcritical, supercritical, and ultra-supercritical. Common conditions for these categories are denoted in Table

February 2012

1. As the thermodynamic conditions increase, so does the efficiency of the steam turbine. For today’s highest steam conditions, overall large fossil steam turbine power plant efficiencies can reach 45-46% (LHV basis). In addition to the thermodynamic cycle, the actual mechanical layout of the different turbine sections can also impact the unit’s performance. There are several considerations for the layout and orientation of the different sections. The choice is driven by the volume of steam flow through the unit, as well as cost and performance factors. One option is an opposed-flow High Pressure – Intermediate Pressure configuration

which GE first introduced in 1950. This configuration consists of the High Pressure (HP) turbine and the Intermediate Pressure (IP) turbine on the same rotor and contained within the same shell casings. This approach reduces the overall mechanical span of the turbine and reduced the number of shell casings. For this configuration, the throttle steam is admitted at the middle of the HP – IP rotor span, as is the reheat steam. These steam flows are separated by an internal, high pressure seal packing at the center of the rotor span. One challenge in a combined HPIP design is the rotor dynamic limit on the overall bearing span of the section. From a steam path design point of view, there is a desire to have the length as long as possible to allow for ample space for the stages. However, long bearing span lengths lead to a more flexible rotor with larger responses to unbalance. These response deflections will be greatest at the mid span which corresponds to the location of the high pressure seal packing. From the high pressure packing point of view there is a desire to have a very stiff rotor to allow for tight clearances to be maintained. The balance between designing for the steam path and the mid span packing is key to the overall performance capability of the section. In spite of these challenges, the opposed HP – IP configuration has served as the basic configuration for GE’s mid-sized steam turbines (300 MW–600

As the thermodynamic conditions increase, so does the efficiency of the steam turbine. For today’s highest steam conditions, overall large fossil steam turbine power plant efficiencies can reach 45-46% (LHV basis) MW), with over 250 turbines currently in service. It provides high power density with acceptable performance. An alternative configuration is separate HP and IP turbine sections, which has typically been reserved for larger output units. In these designs the HP and IP section have their own casings and bearing spans. Having separate rotors on their own bearing spans allows

for an increased number of stages in the sections which significantly improves performance. However, the disadvantage of the separate casings is the addition of two seal packings at the ends of the casings adding to the potential leakage. The separate HP and IP turbine configuration has served as the basic configuration for GE’s large-sized steam turbines (600 MW plus), with over 120 turbines currently in service. As plant configurations become more focused on higher efficiency and performance, the steam turbine configuration also has increased focus on performance. For example in the case of a 660 MW supercritical steam turbine, moving from a combined HP – IP configuration to a separate configuration allows 5–6 additional stages to be added to the HP turbine, thereby increasing its efficiency by approximately 1.5% points. In the IP section, 3–4 additional stages can be added, resulting in a 1.0% point improvement in the IP efficiency. The impact on overall steam turbine heat rate is an improvement of 0.5% points of thermal cycle efficiency, in spite of the additional casing end packing leakage flows. GE’s high performance configuration is the separate HP and IP turbine configuration. This configuration is being offered in the 50 Hz and 60 Hz 600–800 MW output range with the G/D-15 series of steam turbines. Write to us with your feedback at pwi@nextgenpublishing.net

Thermodynamic Conditions of Steam Category

Throttle Temperature

Reheat Temperature

Pressure

Subcritical

565°C (1050°F)

169 bar (2450 psi)

Supercritical

565°C (1050°F)

593°C (1100°F)

250 bar (3626 psi)

Ultra-Supercritical

600°C (1112°F)

610°C (1130°F)

280 bar (4060 psi)

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Tech’tonic

Through its joint venture with the world’s leading energy and telecom cables’ company, the Prysmian Group, Ravin Cables has committed to bringing the best technology and product solutions to India…

Technology Edge

avin Cables Limited has a 50year old legacy of excellence, innovation and world class sophistication in the domestic power cable segment. In a joint venture ( JV) with the Prysmian Group, a world leader in the energy and telecommunications cables industry, the company manufactures all kinds of LV, MV, HV, EHV and other speciality cables in India. By aligning with the global R&D and expertise of the Prysmian Group, Ravin Cables hopes to enhance the quality quotient of all products. For customers, the JV means access to ultimate product design and materials, full reliability of production processes and high standard of quality and services. Customers also stand to gain from the best global practices and cross fertilization between standard and specialty products. The company also wishes to scale up the technological space, roll out new state-ofthe-art broad ranges of high voltage (HV)/ extra high voltage (EHV) cables, industrial cables, specialty cables, to cater to sectors like wind, solar, automobile, rolling stock and railways, mining, marine, crane, plant, pilot and petrochemicals, offshore and umbilical. In addition to this, the JV also plans to cut down on speciality cables imports by bringing technology based product ranges to India. The company, since establishment,

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has specialised in manufacturing power and control cables. It also provides intertrade and service activities. It enjoys an excellent reputation due to the quality of its products and services and diligent working methods.

RESEARCH AND DEVELOPMENT The Prysmian group considers its R&D activities to be fundamental for the company’s growth, a belief shared by Ravin Cables. A large number of registered patents and on-going investments are proof of the company’s commitment and success in this area. The recognized quality and reliability of its products, and the reduction in the cost of materials and processes are other important objectives achieved through Prysmian’s on-going investment in R&D. Prysmian has seven worldwide R&D centres in Italy, France, UK, Germany, Spain, United States and Brazil. In addition, it has also developed strong collaborative links with some of the world’s major universities and research centres including the Polytechnic of Milan, the University of Barcelona and the University of Sao Paulo.

PRODUCTS AND SOLUTIONS Power distribution Medium voltage cable

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systems

(including network components) for the connection of industrial and/or residential buildings to the primary distribution network and low voltage cable systems for power distribution and wiring of buildings. Ravin Cables supplies an extensive range of power cables, conductors, installation components and accessories for underground and overhead distribution systems. These consist of polymeric, elastomeric, covered and bare overhead conductors, cable jointing and terminating systems, resin for encapsulation as well as appropriate installation tooling. Power transmission Prysmian designs, produces and installs high and extra high voltage cables for power transmission directly from power plant sites to primary distribution networks. As a part of the Prysmian Group, Ravin Cables offers a wide range of high and extra high voltage cables and network components in India. Prysmian power transmission solutions include the most advanced turn-key submarine power cable systems and a wide range of network components (including joints and terminations) for all voltage classes. Saptarshi R. Dutta Write to us with your feedback at pwi@nextgenpublishing.net

“The future is in the renewable energy segment” In a power packed interview with PWI, Mr Vijay Karia, Chairman and Managing Director of Ravin Cables Limited, spoke about the lacunae in the regulatory environment for the electrical equipment industry, the company’s JV with Prysmian and the way ahead…

o what extent has your vision been realised since Ravin Cables got into the joint venture with Prysmian? We still have a very long way to go in terms of technology and manufacturing of new products. This is because the integration process has been very slow. When we signed the JV, we had expected a lot more, which has not been realised as per the vision. On the manufacturing front, the problem has been that capacity worldwide has been lying ideal. We had envisioned indigenization of products in India, which could not happen. In addition, because of the financial crisis in Europe, which has also impacted India to a certain extent, all sectors (including energy) have suffered and investments have not moved ahead, especially in the innovation area. Has the company made any fresh product or service announcements at ELECRAMA 2012? We have had a couple of products being displayed at the exhibition, which are very futuristic. Air guard cables, based on the air bag technology, renewable energy cables with ‘plug and play’ systems, which people were not aware of, and others. We also have the network components and extra high voltage cables. We have showcased services – projects done for Reliance

in Mumbai recently. In this project, on a 40 metre high tower, we have directly connected the overhead transmission line of 220 kV and brought it underground too. We have received a lot of enquiries for this technology. We are trying to mushroom this technology as quickly as possible, lest it becomes out-dated. What product lines are you looking to introduce in the year 2012? More than launching a new product line, we are looking at diversifying into different segments of business – renewable, especially, solar energy. In this realm, we are already supplying plug and play systems including cables. The cable vertical will remain where it is, but other verticals will increase in there scope. The future is in the renewable energy segment and specialization of services for extra high voltage cables. Towards becoming a turnkey solutions provider, we are looking at bringing various technologies and innovative ideas into India. What are your expectations from policy and regulation for equipment manufacturing, at state as well as central level? From the point of view of the electrical industry, I look towards having a unified policy across the country for the entire electrical segment. Secondly, giving a

deemed export status to the electrical industry, more so, on the distribution side because maximum losses are taking place in the distribution side. Unless we upgrade that, it will continue to be like a leaking pipe, and pumping money will be useless. In addition, I look forward to a big duty protection for the local industry. China, for example has 50% duty protection for the local industry. In India, the duty protection is negative, with 5% for metals and 7.5% for polymers and finished cables. The utilities ask for 10 years’ experience certificate from the local industry and will indulge in other formalities. However, if the same products are coming from abroad, utilities will accept a Chinese certificate, which is written in a foreign language and not even legible. Agreed, there are unscrupulous elements in the metals an electrical industry, who are spoiling the name of the authentic manufacturers. We need to start discriminating between the good and the bad. It is a dangerous situation which needs attention. We are seeing that production managers of cable companies start off their own ventures with half-baked ideas. This has to change.

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EVENTS

JANUARY 23-24, 2012

India Energy Congress 2012 addresses ‘Emerging Opportunities in Energy Sector’

he India Energy Congress (IEC) 2012 was held with great fervor in New Delhi from January 23-24 at the Lalit hotel. The flagship event of World Energy Council- Indian Member Committee (WEC-IMC), provided an extensive platform for energy sector players to share their knowledge, views, ideas and resourceful prospects in a collaborative manner and to further chalk out the roadmap for sustainable growth of the sector. The WEC, an alliance of 93 countries is a global and inclusive forum for thought-leadership and engagement committed to sustainable energy future. Its mission is to promote the sustainable supply and use of energy for the greatest benefit of all. It is represented by members from government, including energy sector ministries and related department of energy sector, corporate associations, academic institutions, energy professionals and experts of the India energy sector as individual members. The two-day session of this year’s Congress was aptly themed “Emerging Opportunities in Energy Sector”. It focused on issues, challenges and opportunities in each of the sectors of energy namely power, coal, oil, gas and renewables energy management 68

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and distribution. The event was addressed by the Union Ministers for Power, Petroleum and Natural Gas, Coal, New and Renewable Energy and Minister of State for Power. There were six sessions on each of these sectors, along with a ministerial session, wherein the minister and the apex policy maker of the energy sector highlighted the issues at the macro level. This was followed by a panel discussion amongst key stakeholders of the sector, including energy professionals from public and private sectors and other leading energy experts. Dr Christoph Frei, Secretary General, World Energy Council addressed the opening session of the Congress and shared the global and regional energy challenges and global perspective on emerging opportunities and technologies in energy sector. Mr. B.K Chaturvedi, Member of Planning Commission, the apex policy making body in India presented his vision of “Energy Sector 2032 and beyond.” The highlight of the first day was the release of the ‘India Energy Book 2012’, which comprehensively presents an overview of coal, power, oil, gas, nuclear

February 2012

and renewable sectors. It is a useful reference for the energy fraternity and is being developed and refined every year by WEC-IMC. The Indian Member Committee of WEC is being managed by NTPC under the patronage of Ministry of Power. Mr. Arup Roy Choudhury ,CMD, NTPC has committed his full support to WEC-IMC and this was his first event after taking charge as Member Secretary (WEC– IMC). He has also recently been elected as the Vice Chair (Asia Pacific and South Asia) of WEC, and in this capacity had extended an invitation to all the WEC member Committees in the region. Mr Teruaki Masumoto, Chairman, Japan Energy Association and Mr Young Hoon David Kim, former Vice Chair (Asia Pacific and South Asia), WEC and CEO DaesunG Group, Korea also graced the occasion. Mr David Kim made a presentation on 2013 World Energy Congress, inviting the Indian energy fraternity to Korea for the Congress.

WEC projects India’s fast growth in the energy sector Increasing the average efficiency of coal plants from 33 to 43 per cent would help India save more coal than what it imports, says Mr Christoph Frei, Secretary General, World Energy Council (WEC) in an interview with Monica Chaturvedi Charna ...

hat are the key trends that are driving the power sector, primarily in the field of generation and transmission? Policy frameworks are crucial to attract long-term investments for any country. To ensure this, we need to look at the three pillars of energy policy in a holistic way. These pillars are security of supply, environment and social equity. Hence, it is essential to build a balance among all these aspects simultaneously. If frustration builds in any one of these areas, it will lead to disruptive policy changes. In order to build a robust policy, keeping each country’s priority and needs in consideration, maintaining this balance qualifies for a major requirement. India is a large economy with massive growth needs. Having become the ninth largest economy with the world’s top five growth rates, the country has five times less energy access. India can learn from the experience of South Africa, which invested in low tariffs up to such a level that investors were totally shying away. They could not recuperate the capital and it became very difficult to back out at the

same time. Ultimately, the government had to accept severe conditions in order to get the capital back. This is something that no government would want. Considering that solar power tariffs have fallen by nearly 50 percent in the last three years in India, do you think solar will become the mainstay in the realm of renewables? We stand for openness to all technologies, since it is important to look at the best options and prepare an optimum mix of technologies. On the renewables side, I see a lot of emphasis being given to solar power in India. Whereas, there is lots of untapped potential in wind, being commercially viable and close to grid parity. I feel that one has to be very rational with the choice of the options. If, today, wind is cheap and has massive potential, it does make sense to understand how can dynamics be achieved in the sector. Another element is that coal is the undisputed contributor in the power sector and will remain the same. Yet, there are concerns regarding import dependency and climate change. Keeping this in mind, if India is able to increase the average efficiency of coal

plants from 33 to 43 per cent, it would save more coal than what it imports. Investment in this direction makes sense from the energy security and commercial perspective. Despite a decent growth in the Indian power sector in the last decade, state electricity boards have been accumulating huge losses. What, do you think, are the reasons for this and how can the issue be resolved? Power distribution stands out as a major issue requiring immediate attention. The question arises as to how the states define tariff levels and address the issue of maintaining and expanding the distribution grids. Many countries have struggled with similar issues and what we, at WEC, suggest for countries is to compare notes for dealing with similar issues. It is not easy to get the distribution side right and to have tariffs regulated in the backdrop of political pressure. Hence, it is integral to have the right model and right dialogue. Which country can serve as an example for India to deal with its power sector woes?

February 2012

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Events The issue requires a deep analysis into the structural elements like federal vs state level, then there are countries with policy of very low tariffs, and look at the practices in such constellations that have led to good progress. Having said this, the example of South Africa comes to my mind. They were proud to have the lowest tariffs for sometime, but had to change their policy in this area because they were not able to recover the capital. At WEC, we could go into deeper analysis and find which are the countries that structurally correspond to the situation and bring them on this platform to share their experiences and have a dialogue to present their success stories. This will be a significant contribution from our side. Do you think nuclear would be the answer to meet the increasing power demand, in the wake of low supply of coal and variable nature of renewables? Before the Fukushima disaster happened, majority of the people proudly spoke about the renaissance of the nuclear industry, believing that nuclear is fully backed. But the disaster has changed the perspective everywhere. The countries which strongly reacted to the incident, in terms of policy changes are Germany and Japan. By 2020-23, Germany is planning to completely be out of nuclear, which is very dramatic. Switzerland, too, is looking into the issue, with no legislation formulated as yet. Italy, on the other hand was already in a moratorium and are still in a contemplation mode. Talking about India, though a particular group is still committed to nuclear, there is another section which definitely looks concerned. And, since India is a democracy, the concern is voicing itself with a very strong impact. As far as countries that are going 70• PowerWatch INDIA

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forward with nuclear are concerned, I can say that China, Korea and Russia together make 66 per cent of the new projects, and there is no sign of any impact in terms of change. Having said this, it all boils down to what a country’s priority is. If climate change is an issue which we prioritise then it helps to take a decision regarding nuclear technology. Any message that you would want to give for the Indian power equipment manufacturing industry? According to what I have gathered from the discussions held at the India Energy Congress 2012, China has emerged as a strong player because of its decision to make renewables as one of the strategic areas, and investments in the sector have led to lower prices of solar panels, modules and other equipment. With India ranking fifth in terms of wind production, the country has a lot of potential for research and development (R&D), owing to the high level of education, skills and cultural diversity. I feel India can easily become a great place for innovation, then why not focus its opportunities in the development of renewable energy and have aspirations to become a leader like China. . The year 2012 is “International Year of Sustainable Energy for All”. How prepared are we globally to make it a reality? I have gathered that India is very much aware of the concept of sustainable energy, but internationally, there is a need to have better understanding. There are around 90,000 villages in India that are far away from being electrified. There is a strong need to bring hundreds and thousands of villages, globally that need to be brought under

February 2012

grid connectivity. We need to have a systematic inventory, where we know the demographic details – number of houses, density of villages, local resources available in each village, willingness and capacity of the inhabitants to pay, skills available in those villages. Having gathered all the information, we could strategically analyse which are the villages that have similar technology opportunity. We can then approach investors with a business model for villages with similar technology, say for example small hydro, bio-gas, wind, etc. I am pleased to hear from the Ministry of New and Renewable Energy of India that they would support WEC’s current coordinated efforts to build partnerships for generating this inventory in India and beyond. This could be a catalyst in achieving rural electrification and is an important issue requiring extensive discussion and planning. What are your views on the issue of energy-water nexus in Asia and Africa, keeping the climate changes in mind ? There is a great interdependency between electricity and water in any mostly all technologies, be it hydro-power, bio-fuels, coal gasification/liquification and oil production. Power generation comprising cooling towers and refineries has massive water needs. Keeping climate change into consideration, water availability may become a more serious concern than electricity in the near future, posing a need to develop infrastructure for water security as well. Developing this infrastructure in Asia and Africa is a critical issue since they are sensitive to the problem of water scarcity. Hence, if we put energy security against water security, the issue grabbing greater emotional attention is definitely water security.

Events

ELECRAMA 2012 Generates Dazzling Business Opportunities

LECRAMA-2012, India’s largest biennially, or perhaps the world’s largest, electrical transmission and distribution (T&D) exhibition was held in Mumbai from January 18-21, 2012. Organised by the Indian Electrical and Electronics Manufacturers’ Association (IEEMA), the exhibition was jointly

inaugurated by Mr. Sushilkumar Shinde, Union Minister of Power, Mr. Ramesh Chandak, President, IEEMA and Mrs. Indra Prem Menon, Chairperson, ELECRAMA2012. Talking at the inaugural function, Mr. Shinde assured the Indian power equipment industry of adequate protection. He also informed that the Prime Minister is keen on resolving issues of

the Indian power sector. In his address, Mr. Chandak requested the Union Minister of Power to create a level playing field for domestic electrical manufacturers. The exhibition hosted more than thousands stalls and delegates from 127 countries graced the occasion. At the Commerce Day of ELECRAMA-2012, IEEMA sets US $25 billion exports target of electrical and electronics equipment in the next 10 years. The objective of this day was to highlight strengths and capabilities of the Indian electrical equipment manufacturing industry and also to highlight the emerging global opportunities for exports from India. Mr. R N Nayak, PGCIL CMD announced a high-level meeting of head honchos of IT, telecom, power generation, electricity storage, advance metering, automobile companies to give their inputs on the development of ‘Smart City’. He also announced the company’s plans to add 80000 kms of transmission lines and 80 sub stations in the next five-six years, creating US $28 – 30 billion business opportunity in the T&D sector. The special highlight of this year’s ELECRAMA was the ChangeXchange – The Reverse Buyer-Seller Meet that served as an excellent forum for meeting a variety of Indian sellers.

“One of the critical issues is metering every single Urban consumer. On the other hand, it is equally critical to provide interest subsidy to Discoms and towards this end the government has promulgated NEF. We are expecting that Discoms will avail Rs 25000 crore in the first two years of launch.” Mr. P Uma Shankar, Power Secretary

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February 2012

“In the global environment, innovation is the only way out for Indian companies. India will have to increase its Research & Development (R&D) spends to at least 1% of sales from the current minuscule fraction of a percentile. In fact, at BHEL we have increased our R&D spends to 2.5% of our sales. And mind you our sales are growing at 20% CAGR.”

“On February 17, head honchos of companies involved in IT, telecom, power generation, electricity storage, advance metering, automobiles, etc. will meet and brain storm to give their inputs on the development of Smart City.” Mr. R N Nayak, PGCIL’s CMD

Mr. B P Rao, CMD, BHEL

Interview with

Mr Ramesh Chandak

PWI spoke with the President, IEEMA, on the recent ELECRAMA, the business and interest generated and what to expect in the next...

rom IEEMA’s perspective, how has ELCRAMA 2012 been different from previous years? Every subsequent ELECRAMA right from 1990 has been an improvement over the earlier ELECRAMA, in terms of participation, quality of visitors, equipment, aesthetics of stalls and infrastructure conditions. Having said this, our focus this year was to make it better or at par with any international exhibition anywhere in the world. This year, we had more than a thousands stalls with almost 127 countries participating. The quality of visitors has improved tremendously, with better government participation and the presence of major ministers from the power and commerce industry. Participation from the public sector and

multinationals has also increased manifold. We no longer encourage walk-in customers at ELECRAMA as it is not a B2C platform. This year, we arranged for a buyer-seller meet, which was quite successful. For the first time, we organised a CIGRE tutorial, an NGO comprising stalwarts from the sector who voluntarily participated. This year, for the first time, we organised the GridWeek Asia, which focused on the hot topic of Smart Grids. By all standards, ELECRAMA 2012 has been 30-40 per cent better than any large T&D exhibition, anywhere in the world. Was there a conscious decision by IEEMA to invite more foreign delegates this year? Yes, there was a conscious decision on our part to invite more foreign delegates (there

was participation from 127 countries) in order to ensure quality participation. We observed that the event was an eye opener for Africa, which has been dominated by the European market. I am confident, after the event they are open to sourcing material from India. What, do you think, can be the balancing act between domestic equipment manufacturing and imports? We are not against imports and are aware that the domestic equipment manufacturers have to become more competitive. However, I would go by the Maira Committee, which has recommended having a 14 per cent import duty, to protect the interests of the domestic industry.

February 2012

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Vital Stats REGION-WISE SUMMARY OF POWER GENERATION ( JANUARY 2011) Category/Regions

Monitored Capacity (MW)

Generation (GWH) Program

Actual

Percentage of Program (4/3)

Northern Region Thermal

30733.26

15723.00

16244.34

103.32

Nuclear

1620.00

782.00

999.09

127.76

Hydro

14978.25

2603.90

2932.16

112.61

Total

47331.51

19108.90

20175.59

105.58

Thermal

42554.31

22307.00

21508.60

96.42

Nuclear

1840.00

864.00

1269.91

146.98

Hydro

7392.00

1315.30

1170.99

89.03

Total

51786.31

24486.30

23949.50

97.81

24780.80

14207.00

14080.88

99.11

Western Region

Southern Region Thermal Nuclear

1320.00

480.00

634.94

132.28

Hydro

11372.45

2510.22

2590.50

103.20

Total

37473.25

17197.22

17306.32

100.63

Thermal

24490.05

11356.00

10916.53

96.13

Hydro

3847.70

540.83

361.91

66.92

Total

28337.75

11896.83

11278.44

94.80

Thermal

858.50

373.00

425.32

114.03

Hydro

1158.00

222.41

134.25

60.36

Total

2016.50

595.41

559.57

93.98

Imports from Bhutan

0.00

93.00

126.32

135.83

Thermal

123416.92

93966.00

63175.41

98.76

Nuclear

4780.00

2126.00

2903.94

136.59

Hydro

38748.40

7192.66

7189.69

99.96

Bhutan Imports

0.00

93.00

126.32

135.83

Total

166945.32

73377.66

73395.36

100.02 Source: CEA

Eastern Region

North Eastern Region

All India

GWH: Giga-watt hours

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28833

7668

5519

1711

6683

Andhra Pradesh

Karnataka

Kerala

Tamil Nadu

275

Goa

Western Region

416

5894

Madhya Pradesh

Dadra & Nagar Haveli

6695

Gujarat

14061

1299

Chhattisgarh

193

22266

Northern Region

Daman & Diu

847

Uttarakhand

Maharashtra

4973

6943

Uttar Pradesh

2796

Punjab

Rajasthan

702

1378

2741

Haryana

Jammu & Kashmir

1783

Delhi

Himachal Pradesh

103

Requirement (MU)

Chandigarh

State/System/ Region

5879

1672

4805

6736

24561

268

413

173

11128

4678

6668

1233

20238

823

5881

4712

2619

1014

690

2627

1770

102

Availability (MU)

-804

-39

-714

-932

-4272

-7

-3

-20

-2933

-1216

-27

-66

-2028

-24

-1062

-261

-177

-364

-12

-114

-13

-1

(MU)

-12.0

-2.3

-12.9

-12.2

-14.8

-2.5

-0.7

-10.4

-20.9

-20.6

-0.4

-5.1

-9.1

-2.8

-15.3

-5.2

-6.3

-26.4

-1.7

-4.2

-0.7

-1.0

(%)

Surplus/Deficit (-)

DECEMBER 2011

538

36 47

Mizoram Nagaland

MU: Million units

All India

North-Eastern Region

81381

888

150

Meghalaya

Tripura

467

7650

2778

1773

Manipur

Assam

Arunachal Pradesh

Eastern Region

Andaman-Nicobar

Sikkim

West Bengal

Orissa

Jharkhand

1248 1286

21744

Southern Region

DVC

Lakshadweep #

Bihar

163

Requirement (MU)

Puducherry

State/System/ Region

ALL INDIA POWER SUPPLY POSITION (DECEMBER 2011)

72195

800

114

434

7343

2728

1757

519

1274

1038

19253

161

-9186

-88

-4

-2

-4

-36

-4

-33

-5

-307

-50

-16

-19

-12

-210

-2491

-2

(MU)

Source: CEA

-11.3

-9.9

-5.4

-4.3

-11.1

-24.0

-7.0

-7.1

-8.8

-4.0

0.0

-1.8

-0.9

-3.5

-0.9

-16.8

-11.5

-1.2

(%)

DECEMBER 2011 Availability Surplus/Deficit (-) (MU)

Vital Stats CRUDE OIL PRODUCTION DURING NOVEMBER 2011 Name of the undertaking/unit

Planned production of the Production during the (in ‘000 tonnes) month Month under review*

Corresponding month last year

Preceding month of same year

Oil & Natural Gas Corp. Ltd.

1962.0

1940.0

2024.0

2026.0

Onshore

583.0

606.0

615.0

626.0

Gujarat

452.0

461.0

474.0

479.0

Assam

96.0

99.0

100.0

Andhra Pradesh$

19.0

25.0

23.0

25.0

Tamil Nadu

16.0

21.0

19.0

22.0

Mumbai High Offshore

1379.0

1334.0

1409.0

1400.0

Oil

1211.0

1176.0

1255.0

1232.0

Condensates

168.0

158.0

154.0

168.0

Oil India Ltd. (OIL)

307.85

311.2

300.8

325.6

Assam

306.12

309.3

299.1

323.6

Arunachal Pradesh

1.73

1.9

1.7

2.0

DGH (Private/JVC)

864.598

833.2

943.8

866.4

Onshore

529.696

544.8

544.0

561.7

Arunachal Pradesh

7.38

7.8

6.9

7.8

Assam

0.02

0.0

0.9

0.0

Rajasthan

511.651

524.7

524.4

542.0

Gujarat

10.645

12.4

11.8

Offshore

334.902

288.4

399.8

304.7

Grand Total

3134.448

3084.5

3268.6

3218.0

Onshore

1420.546

1462.1

1459.8

1513.3

Offshore

1713.902

1622.4

1808.8

1704.7 Source: MoPNG

$: Includes production from offshore east coast *Provisional

COAL STOCK POSITION AT THERMAL POWER STATIONS IN THE COUNTRY (AS ON FEBRUARY 01, 2012) Region/State

Name of Thermal Power Station

Capacity (MW)

Coal Requirement (in ‘000 tonnes)

Actual Stock In ‘000 tonnes

In days

Rajghat TPS

135.0

2.2

Badarpur TPS

705.0

13.1

Panipat TPS

1360.0

22.4

Northern Delhi

Haryana

Punjab

•

Yamuna Nagar TPS

600.0

8.4

Rajiv Gandhi TPS

1200.0

20.0

143

Indira Gandhi STPP

1000.0

13.8

GH TPS (Leh.Moh)

920.0

13.5

229

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February 2012

Rajasthan

Uttar Pradesh

GND TPS (Bhatinda)

440.0

5.4

137

Ropar TPS

1260.0

20.9

373

Kota TPS

1240.0

20.5

Suratgarh TPS

1500.0

21.5

Chhabra TPP

500.0

6.6

Anpara TPS

1630.0

26.3

155

Harduaganj TPS

470.0

4.1

Obra TPS

1372.0

14.3

Panki TPS

210.0

3.6

Parichha TPS

640.0

9.6

243

Dadri NCTPP

1820.0

27.5

Rihand TPS

2000.0

33.2

205

Singrauli TPS

2000.0

33.8

381

Tanda TPS

440.0

8.1

Unchahar TPS

1050.0

18.2

Rosa TPP Ph-1

900

9.0

Anpara C TPS

1200

15.9

24592.0

372.9

2654

DSPM TPS

500.0

9.0

161

Korba 2

440.0

9.0

135

Korba West TPS

840.0

14.9

378

Korba STPS

2600.0

38.9

587

Sipat STPS

2320

31.0

216

Pathadi TPP

600.0

9.0

142

Bhilai TPS

500.0

8.1

102

Gandhi Nagar TPS

870.0

14.7

175

Total of N.R. Western Chhattisgarh

Gujarat

Madhya Pradesh

Maharashtra

Total of WR

Sikka Rep. TPS

240.0

3.9

Ukai TPS

850.0

13.8

120

Wanakbori TPS

1470.0

23.3

282

Sabarmati (C Station)

400.0

6.6

Amarkantak Ext.TPS

450.0

5.4

172

Sanjay Gandhi TPS

1340.0

19.1

Satpura TPS

1142.5

18.5

142

Vindhyachal

3260.0

55.9

533

Bhusawal TPS

420.0

7.8

Chandrapur STPS

2340.0

40.3

367

Khaparkheda TPS

1340.0

16.1

104

Koradi TPS

1040.0

14.3

Nasik TPS

880.0

14.0

176

Parli TPS

1130.0

17.9

Paras TPS

500.0

7.8

Dahanu TPS

500.0

9.6

Wardha Warora

540.0

6.9

165

26512.5

415.8

4407

February 2012

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Vital Stats Region/State

Name of Thermal Power Station

Capacity (MW)

Coal Requirement (in ‘000 tonnes)

Actual Stock In ‘000 tonnes

In days

Dr N Tata Rao TPS

1760.0

26.9

Kothagudem TPS

1720.0

25.9

216

Ramagundem B TPS

62.5

1.0

Rayalaseema TPS

1050.0

17.0

Ramagundem STPS

2600.0

39.5

204

Simhadri

1500.0

23.9

Kakatiya TPS

500.0

8.6

252

Karnataka

Raichur TPS

1720.0

25.7

Bellary TPS

500.0

9.0

Tamil Nadu

Ennore TPS

450.0

7.2

Mettur TPS

840.0

14.0

156

North Chennai TPS

630.0

10.8

169

Tuticorin TPS

1050.0

19.1

14382.5

228.6

1349

Baurani TPS

310.0

1.2

Muzaffarpur TPS

220.0

1.8

Kahalgaon TPS

2340.0

41.8

Patratu TPS

770.0

3.0

Tenu Ghat TPS

420.0

4.8

Bokaro B TPS

630.0

9.3

Southern Andhra Pradesh

Total of SR Eastern Bihar

Jharkhand

Orissa

West Bengal

Chandrapura (DVC) TPS

890.0

8.4

Maithon RB TPP

525.0

7.6

179

Kodarma TPP

500.0

7.2

IB Valley TPS

420.0

8.1

Talcher (Old) TPS

470.0

8.6

Talcher S TPS

3000.00

53.5

Sterlite TPP

1800.0

17.9

Durgapur TPS

340.0

4.9

103

Mejia TPS

2340.0

29.9

Bakreswar TPS

1050.0

17.9

Bandel TPS

450.0

5.1

DPL TPS

690.0

8.1

Kolaghat TPS

1260.0

18.8

Sagardighi TPS

600.0

8.1

Santaldih TPS

980

6.6

Budge Budge TPS

750.0

9.9

213

New Cossipore TPS

160.0

1.3

Southern Repl. TPS

135.0

2.4

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February 2012

240.0

3.9

Farakka STPS

2100.0

32.9

Durgapur Steel TPS

500.0

7.2

Total of ER

23890.0

309.7

1422

All India Total

89377.0

1348

9832

Sources: CEA and CIL

Titagarh TPS

NATURAL GAS PRODUCTION DURING NOVEMBER 2011 Name of Undertaking/unit

Planned Production during the month

Production during the (in million cu mt) Month under review*

Corresponding month last year

Preceding month of current year

Oil & Natural Gas Corp. Ltd.

1983.037

1911.3

1880.2

1955.3

Onshore

445.004

479.2

455.1

482.6

Gujarat

148.934

156.1

157.7

158.0

Rajasthan

1.280

1.4

1.0

1.5

Assam

39.013

42.5

39.5

42.9

Tripura

49.056

53.7

52.2

55.4

Andhra Pradesh

106.289

119.3

109.8

114.1

Tamil Nadu

100.432

106.2

95.0

110.8

Offshore

1538.033

1432.1

1425.1

1472.7

Mumbai High Offshore

1538.033

1432.1

1425.1

1472.7

Oil India Ltd. (OIL)

219.413

218.0

204.3

235.8

Assam

198.693

196.1

188.3

212.7

Arunachal Pradesh

1.520

1.3

1.2

1.9

Rajasthan

19.200

20.6

14.8

21.3

DGH (Private/JVC)

2109.703

1718.1

2196.9

1834.6

Onshore

67.997

55.7

56.6

58.4

Arunachal Pradesh

1.970

1.6

2.0

1.7

Assam

1.500

0.0

2.4

0.2

Rajasthan

34.246

29.0

24.8

29.9

Gujarat

16.827

18.5

24.8

29.9

West Bengal $ (CBM)

12.870

6.3

3.0

6.8

Madhya Pradesh (CBM)

0.134

0.2

0.0

0.2

Jharkhand (CBM)

0.450

0.1

0.0

0.3

Offshore

2041.706

1662.4

2140.4

1776.1

Total

4312.153

3847.4

4281.4

4025.7

Onshore

732.414

752.9

716.0

776.9

Offshore

3579.739

3094.5

3565.4

3248.8

$: Coal Bed Methane Production *Provisional

Source: MoPNG

February 2012

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PowerWatch INDIA

•

RNI NO. MAHENG/2010/33690