Electricals Today by Electricals Today

Total pages 44 Volume 1 | Issue 5 | June 2013 | `50

Electricals Today

Management expertise for the power industry

TECHNOLOGY

TROUBLESHOOTING IN POWER PLANTS

GENERATION

COAL IMPORT SET TO INCREASE

Power play How MAHAVITRAN MD AJOY MEHTA HAS ENSURed UNINTERRUPTED ELECTRICITY IN maharashtra

Published by ITP Publishing India

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People

Contents 28

12 Column

Sanjeev Aggarwal, MD of Amplus Infrastructure, on the benefits of tariff hikes by states

14 Distribution

Ajoy Mehta, MSEDCL MD throws light on how he turned around Maharashtra to a power surplus state

Generation

22 Fuel

Power generators are looking for new avenues to import coal, as domestic supply decreases

26 Finance

Lack of clarity in policy, resulting in power generators holding on to their purse strings

28 Solar energy

Innovations in solar are driving the markets in Maharashtra

31 Case study

SKF India's Solution Factory's services helping utilities in enhancing efficiency

Transmission

34 Smart grids

All stakeholders pushing for a speedy implemenation of smart grids

Ajoy Mehta

REGULARS

06 Bulletin

Industry round-up, including news and events

39 Market column

Opportunities available for power companies

40 Market data

A look at key industry trends and statistics

42 Ten things about

Bulk transmission of power

Power cuts in Maharashtra have come down drastically. The deficit is less than 500 MW now."

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EDITOR'S NOTE

Election gimmicks?

he month of May was abuzz with activity across the board. And the power sector was no different, with listed companies busy announcing their annual results and strategising plans for the year. The discom segment too saw a lot of movement in the beginning of the fiscal with a lot of states revising their tariff. The State Electricity Regulatory Commissions (SERC) were only too willing to give their nod to recent tariff revisions to recover the increase in cost of power procurement as this is their last chance to do so before it becomes a sore point with the masses just before the country goes to polls. But that's not all. The normally reticent power minister seems to have suddenly come into this own and has started making assertive, headline-grabbing statements. One wonders if this has more to do with getting his house in order before elections next year or just a another desperate attempt to cover up for the failures of the ministry. A couple of weeks ago, Jyotiraditya Scindia hit the headlines by stating,“Once integrated fully, India will be the largest transmission grid in the world.” But the truth is the amalgamation of the national grid is still far from reality as the southern grid is yet to be connected to the national grid. Officials of the power ministry say it is expected to be completed by next year. If the ministry does meet its deadline, it will indeed be a moment of pride for all those who are tirelessly working behind this. But given the slow pace of things in India, it will be a tough task to achieve this milestone in such a short span of time. Whatever be the case, let us be patient and see how things pan out as the national grid will indeed address many issues such as the lack of facility to transfer power from one end of the country to the other. Another case in point about the power ministry's drive to improve its image comes in the form of a recent full-page newspaper advertisement. Let me give the background before touching the content of the advertisement. ‘Power for all by 2012’ was one of the aggressive slogans of the PM and the ruling UPA government. However, the target failed miserably due to various reasons. The advertisement in question emphasised the completion of electrification of 1,07,226 villages under the Rajiv Gandhi Grameen Vidyutikaran Yogana, overlooking the fact that the government had missed the deadline for electrifying all villages. The common man's memory may be short-lived but one can't help but wonder whether such gimmicks can help deflect attention from the mess the power sector is in.

ET ELECTRICALS TODAY

MANAGEMENT EXPERTISE FOR THE POWER INDUSTRY

Volume 1 | Issue 5 | June 2013

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Bulletin TATA Power launches bill payment through IMPS

Jyotiraditya Scindia

India's power grid to become world's largest: Scindia Optimistic about India's electricity grid becoming the largest in the world, union minister for power Jyotiraditya Scindia has said that checks and balances have been put in place to avoid recurrence of any major grid collapse, similar to the one witnessed last summer. India's transmission capacity during the 12th Five-Year Plan period ending FY 2016-17, is expected to go up from 28,000 megawatts to 65,000 megawatts, "making it the largest grid in the world," he said. The power minister also stressed that last year's grid failure, which saw nearly half of the country go without electricity for hours on two consecutive days in July, happened because of huge over-drawals in defiance of rules. "It (grid collapse) happened not because of the central government or because of all the state governments. It happened because we didn't stick to the rules. If you don't follow the rules Solar projects in JNNSM of over-drawal and under-drawal of the second phase system, you introduce greater volatility in the grid and the moment you have huge squeeze of volatility in the grid that ultimately can lead to a grid collapse, and that is what happened," Scindia said.

750 MW 6

Tata Power (TPL), one of the integrated power utility, has launched bill payments through immediate payment service (IMPS), an initiative through National Payments Corporation of India (NPCI). This initiative provides customers the convenience of making bill payments 24x7. Presently, customers can use the service through four platforms – mobile phone, ATM, internet banking and phone banking. At present, 22 out of 56 participating banks of NPCI are enabled with payment service. Commenting on this initiative, S Padmanabhan, executive director (operations), TPL, said, “As a lead adopter of technology, we strongly believe that the future is all about secure and convenient payment options. And IMPS clearly has the potential to change the power utility payment ecosystem.”

R-Power Q4 profit up 15 % ADAG company R-Power has posted 15 per cent jump in its net profit at Rs266.06 crore for the quarter ended March 31, 2013. The company had reported a net profit of Rs231.31 crore in the corresponding quarter of the previous year (201213), R- Power said in a statement. Total income stood at Rs1,247.79 crore during the period compared to Rs532.59 crore in the same period last fiscal it added. R-Power recorded an annual net profit of Rs1,011.46 crore this year.. "The year 2012-13 saw the development of our 3,960 MW Sasan UMPP in MP and we commenced coal production from our 20 MT/year Moher mines (for the Sasan project)," CEO, R-Power J P Chalasani said in the statement.

Electricals Today | June 2013

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BULLETIN

Kudankulam nuclear plant cleared by SC

Kudankulam has 1,000MW capacity.

It is a sigh of relief for the Kudankulam nuclear plant commissioning was delayed by years owing to severe opposition. The Supreme Court has allowed commissioning of the Kudankulam nuclear plant in Tamil Nadu, dismissing objections by anti-nuclear activists to its establishment. A bench of Justices K S Radhakrishnan and Dipak Misra relied on the 'unanimous' opinions of experts over the plant's safety and security aspects. Observing that the court should respect the national policy that is meant for 'larger public interest,' the bench said that the plant had to go on for controlled use of nuclear energy. In separate but concurring judgements by the judges on the bench, the court added that nuclear energy had become necessary for the welfare of the people and asserted that nuclear energy could minimise problem of power shortage in the country. It also said that when all the safety measures were already in place, nuclear energy was not to negate the right to life of people but to protect the right of life since it would help achieving larger public interest. A batch of petitions was filed by anti-nuclear activists, challenging the project on the ground that safety measures recommended for the plant by an expert body have not been put in place.

India registers 46.5 % growth in power sector India recorded an unprecedented 46.5 per cent growth in new power capacity in the first quarter ending March this year, according to Platts, a global provider of energy price assessments. This comes at a time when power development activity in the Asian region tumbled 12 per cent between January and March 2013 against the year-ago period, it said. Power development activity in Asia in the first quarter totalled 62,743 megawatts (MW), Platts said in its newsletter, Platts Power in Asia. "This was 12 per cent lower than in the same period of 2012, but was well up on the prior quarter - in fact, more than a fifth higher than in the last three months of 2012," said the editor of the newsletter, Martin Daniel. He, however, added the announcement of 21,000 MW projects in Asia during first quarter, almost double that of the fourth quarter of 2012, appeared to indicate an improvement in developer confidence. In line with the overall boost to investor confidence, India added a record 10,768 MW of fresh power capacity between January and March this year against 7,349 MW during the same period in 2012, according to the latest data from the Central Electricity Authority, the planning wing of the power ministry.

AP to add 4,000 MW by March The south Indian state Andhra Pradesh has planned to add over 4,000 MW of generation capacity by next March next. This is expected to significantly ease the demand supply situation in the State. The capacity addition will come in from 1,600 MW project at Krishnapatnam, 600 MW from Bhupalapally of AP Genco, 1,040 MW of Hinduja National Power Ltd and from another project in Ramagundam. In addition, the State will have access to power from NTPC Tuticorin project and NTPC joint venture project at Vellur in Tamil Nadu, according to Hiralal Samaria, chairman and MD of AP Transco. He also said AP Genco was at advanced stage of commissioning at least three projects, including two units of 800 MW at Krishnapatnam, another one at Bhupalapally. â&#x20AC;&#x153;We are sure, consumers will be able to access more than 3,000 MW by December 2014,â&#x20AC;? he said. In addition, wind and solar projects will augment new capacities.

New thermal plants addresses Andhra's deficit.

June 2013 | Electricals Today

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BULLETIN

Thermax improves BOOK Pune based Thermax Limited, energy and environment solutions company has improved its order booking by 21 per cent to Rs4,859 crore (Rs4,032 crore, previous year) this year despite the sluggishness. In the quarter ending 31st March 2013, order booking stood at Rs1,155 crore to that of Rs809 crore last year. The company has posted an operating revenue of Rs4,691 crore, a dip of 12 per cent to the previous year. The company’s annual profit after tax was lower by 14 per cent at Rs350 crore, down from last year’s Rs407 crore. Export income including deemed exports during the financial year constituted 21 per cent of revenue at Rs984 crore.

GMR's Odisha power plant operational GMR Group has started commercial operations in the first unit of its 1,400 MW power plant in Odisha. The group is setting up the coalbased power plant in two phases of 3x350 MW and 1x350 MW, respectively. "The first 350 megawatt unit of GMR Kamalanga Energy Limited (GKEL) was declared commercially operational," the company said in a statement. The power project in Dhenkanal district, about 100 kms from Bhubaneswar, is the group's second coalbased power plant to be declared commercially operational. The power produced from the first unit has been offered to state-run GRIDCO Ltd, as per the long-term power purchase agreement (PPA) with the state government. "This is yet another example of our commitment to on-time delivery of projects, which will now generate revenue and enhance our shareholder value," GM Rao, group chairman of the GMR Group said. Work on commissioning two other units of 350 MW in the first phase is in advanced stages and likely to be completed by August this year.

Fluke Corp introduces wireless system for troubleshooting The new Fluke CNX Wireless System will allow users to troubleshoot problems quickly and efficiently. The set of test tools that wirelessly connect multiple measurement modules and sends simultaneous readings to a master device up to 20 metres away. The rugged, customisable tool set allows users to choose various measurement modules based on their specific troubleshooting scenario. The centre of the This equipment can send signals upto 20 meters. system is a CAT III 1000 V / CAT IV 600 V multi-meter with a screen that displays its readings along with live readings from up to three other measurement modules. For more complex troubleshooting, users can view live measurements from up to 10 modules simultaneously on a computer equipped with the CNX PC Adapter. The modules, which include AC Voltage, AC Current Clamp, iFlex AC Current Clamp, and K-Type Temperature units, can take live measurements or log up to 65,000 sets of data. Logged data can be saved to a computer in .csv format.

Mundra UMPP generates over 12,000 m units Tata Power has said the 4,000 MW Mundra project has generated 12,440 million units of electricity till March this year. Located in Gujarat, Tata Power’s Mundra plant is the country’s first Ultra Mega Power Project (UMPP). “The total generation from the plant till 31st March 2013 has touched 12,440 million units and going forward the plant is expected to contribute more than 26,000 million kWh to the beneficiary states annually,” the company said in a statement. The project supplies elec-

tricity to five states — Gujarat, Rajasthan, Haryana, Punjab and Maharashtra. Mundra UMPP is being implemented by Tata Power’s wholly-owned subsidiary Coastal Gujarat Power Ltd. The first 800 MW unit of the project was commissioned in March 2012. “The average gap between synchronisation of two units has been 3.5 months, which is better than the baseline schedule of four months and is much better than the five months provided in original power purchase agreement,” the statement said.

Electricals Today | June 2013

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BULLETIN

Kerala promotes solar power

IIESR rooftop solar installation.

Kerala State Electricity Regulatory Commission has directed the State Electricity Board (KSEB) to provide an enabling environment for promoting solar power in the State. “KSEB and other licensees in the State should support the individual initiatives for development of solar electricity,” the regulator said in its order. The State government has published the draft of a Kerala Solar Energy Policy, 2013; it reminded KSEB and other licensees. “Solar electricity generation is expected to receive a fillip in the current year itself due to such policy initiatives.” Connectivity to the grid should be provided to all developers after approving and declaring the required technical protocol related to safety and other technical standards. “KSEB shall approach the commission with appropriate proposals related to net metering, feed in tariff, banking, etc. on or before July 31, 2013,” the order said.

Tata Power to set up 28.8 MW solar plant Tata Power plans to set up a 28.8 MW solar plant near Satara in Maharashtra this fiscal, as a part of its strategy to meet its clean energy capacity target. “This will be our second solar plant in Maharashtra. We will be spending over Rs230 crore this fiscal for setting up the project,” company’s executive director (finance) S Ramakrishnan said. Currently, the company has a 3 MW project at Mulshi in Maharashtra and a 25 MW solar photovoltaic (PV) project at Mithapur in Gujarat. Besides, its subsidiary, Tata Power Delhi Distribution Ltd, has also commissioned a 1 MW grid connected rooftop solar power plant in Delhi. Tata Power has also partnered with Australia’s Sunengy to build the first floating solar plant at Mulshi. The firm has set a target of generating 26,000 MW by 2020 and intends to have a 20-25 per cent contribution from clean power sources. The company will also be adding 200 MW of wind energy this fiscal, Ramakrishnan said.

C&S Solar completes rooftop installation at IIESR The C&S Solar EPC division has completed solar PV rooftop system installations at Indian Institute of Science and Education Research (IIESR), Mohali. This is a 40KWp capacity rooftop system on the sixth floor has high end crystalline PV modules. The project was completed well ahead of the committed completion time line. The project can produce more than 200 units of clean power on a given sunny day. The plant is mounted on an aesthetically designed structure which has higher energy efficiency.

Pioneer Wincon's sub-station in Jamnagar.

Suzlon Group wins German wind farm projects

Pioneer Wincon synchronises 25 MW substation

REpower Systems SE, a Suzlon Group-subsidiary have contracted over 27 wind turbines for four projects totalling approximately EUR90 million. CEO Andreas Nauen said, “We are pleased that another community project has selected REpower know-how. Community wind farms, in addition to orders from our major customers, make a considerable part of our German business: totalling nearly 50 per cent in the financial year 2012/13.” REpower will deliver 13 turbines of type 3.2M114 with 123 meters hub height, eleven 3.2M114 with 93 meters hub height, two MM92 with 80 meters hub height, and one MM92 with 100 meters hub height to the project. The turbines are scheduled for delivery over 2014. The community wind farm Medelby is situated in Northern Schleswig-Holstein near the Danish border. REpower also concluded a service contract for 15 years runtime with an option for five additional years.

Pioneer Wincon, Chennai-based wind power company had synchronised its latest 25MW substation and wind power project in Nanimatli village, Jamnagar District, Gujarat. The new substation is especially for the HT captive customers of the state, the P750/49-750 kw turbines are designed sturdy, and equipped with advanced power electronics with trouble-free maintenance. These high-end turbines have been certified by DNV Denmark under the stringent IEC code 61400-1 Edition 3. Pioneer Wincon Private Ltd, member of Pioneer Asia Group, has the technology from Wincon West Wind of Denmark. Ambar Patel, MDShilp Gravures Ltd, while inaugurating the project said “Wind energy segment is on a high rise and coming with advanced technology at affordable prices, it has been my most viable and reliable way to save on the power costs.” India currently has 20 GW of wind energy connected to the grid.

June 2013 | Electricals Today

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BULLETIN

Events SOLARCON India 2013

Venue: KTPO Exhibition Complex, Bengaluru Date: August 1-3, 2013 The 5 edition of SOLARCON India 2013 will provide a framework to discuss the enormous role for solar power in India. From power plants to rooftops and off-grid applications this will be the place to reaffirm the need for investments and commitment in both R&D and manufacturing to address the next demand cycle. th

PetroWorld India

Venue: Bombay Exhibition Center, Mumbai, Date: 22 - 24 August 2013 Organised by Pennwell Corporation, Petro World India, one of the biggest shows will have participations from the petroleum sector. An ideal networking opportunity, also gives the exhibitors a chance to understand the local market, market trends, etc. On the sidelines of the exhibition there will be a three-day conference.

7th REI 2013 expo

Venue: India Expo Centre and Mart, Greater Noida Date: 12-14 September 2013 The seventh edition of Renewable Energy India Expo being held from 12-14 September 2013 at the India Expo Centre and Mart, Greater Noida (National Capital Region of Delhi) India. Organised by UBM India, the last edition of REI was held in November 2012. According to the organisers, the renewable energy sector is growing rapidly and the Cleantech sector has the potential to generate 10 million jobs in India by 2025.

ELECTRI EXPO

Venue: HITEX Exhibition Centre, Hyderabad Date: October 3â&#x20AC;&#x201C; 5, 2013 The first-ever exposition in Hyderabad dedicated to low voltage electricity devices, organised by Hitex Exhibition Centre. The event will bring under one roof, energy efficient, environment friendly and sustainable devices.

Chennai to host Lii 2013

Light India International 2013, Indiaâ&#x20AC;&#x2122;s largest and brightest lighting fair titled Lii 2013 will be held in Chennai. Organised by Indian Society of Lighting Engineers the exhibition will be held in Chennai Trade Centre (CTC) from 13 to 16 September, 2013. Chennai has been chosen for the second time as the venue as the southern state and its suburbs are registering a rapid growth. More than 250 manufacturers are expected to display their products on the platform of Lii -2013. This include 100 plus international participants mainly from China, Taiwan, Korea, Italy, Germany, USA. The exhibition will showcase a wide range of products over the 16,500 sq.m exhibition area, covering residential, commercial and

retail lighting, industrial lighting, street lighting, security lighting, environmental/landscape lighting, city beautification lighting, architectural lighting, railway/metro lighting, airport & runway lighting, refineries/mines lighting, LED lighting, intelligent lighting, lighting with non-conventional energy, specialty lighting, lighting accessories and controls, power saving solutions, and testing and measuring instruments. Seminars and technical sessions; Theme pavilion and Special outdoor lighting will be the other salient features of the fair. Mainly a B2B event, the event is open for business visitors from 10 am to 3 pm and the fair willl be open to public in the evenings from 3 pm to 7 pm.

Electricals Today | June 2013

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BULLETIN

Time to cheer

Though Parliament elections are round the corner, the states are forced to think beyond vote-bank politics and hike the electricity tariff BY ET TEAM

n the month of May, the two south Indian states, Karnataka and Kerala hit the nail hard by hiking the power tariffs. Karnataka announced the tariff hike a day after the state elections were over. Kerala, predominantly a hydro electric dependent state, was forced to announce a power hike owing to the increase in power procurement from outside the state. While in Karnataka the hike is close to 10 per cent, the average in Kerala is between 7 per cent and 12 per cent. A month before this, Tamil Nadu has hiked the tariff to the tune of 37 per cent. This is not all, many other states are contemplating a tariff revision, Rajasthan and Maharashtra are two states which have already moved in this direction. In the last week of March, Andhra Pradesh also announced increase in tariff. The average hike is around 15 per cent across the board for all categories of consumers. Madhya Pradesh, Gujarat, Punjab, Haryana, Bihar and West Bengal also revised the tariff in the month of March 2013. In September 2012, the central government had announced a bailout package to sort out the Rs1.97 lakh crore losses accounted by the state distribution utilities. Out of the mammoth losses, eight states accounted for Rs1.25 lakh crore. And Rajasthan was one of the eight listed states. As on April 2013, the Rajasthan distribution companyâ&#x20AC;&#x2122;s losses have touched Rs50,000 crore. In Rajasthan, the first major tariff revision was in 1998 followed by a marginal increase in 2005. The 12 long years without revision lead to such huge losses. And in 2011, the state revised its tariff by 22 per cent followed by 18 per cent in 2012. This hasnâ&#x20AC;&#x2122;t helped the state SEB to come out of the huge financial mess. It is

believed that the state utility should have tariff revisions every year to minimise the financial losses the state board is facing today. It is expected that by 2016, the utility may turn around. Tamil Nadu, the revision of tariff happened after nine years. The long period has pushed the state utility (TNEB) into a debt of Rs45,000 crore. Tamil Nadu is one of the first states which has availed the bailout package announced by the central government to improve the financial health of the distribution utility. It was mandated that the state government should revise the tariff to make the electricity board turn around. Though electricity is a concurrent subject, it is a bold/ forced move by the state governments to adopt the path of tariff revision. In this year, Delhi Electricity Regulatory Commission Rs crore (DERC) has approved a tariff Rajasthan SEBs losses hike. The first revision was close to as on April 2013 five per cent. It is now reported that the utilities (in Delhi the power is supplied by private utilities) are contemplating another hike of two per cent. If, this also is taken into consideration, then, the hike in Delhi also will be close to the 10 per cent bracket. Electricity still remains a political subject in India. That is the reason why the state had partial roll back within days of its announcing the tariff hike. However, it is laudable that both the government at the centre and the state are realising electricity is a commodity that has a cost attached. It is no longer a viable option to subsidise as the per capita consumption of electricity is growing day by day.

50,000

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Tariff hikes come to discoms' rescue The centre's tough stand played a key role in pushing a majority of states to revise power tariffs Sanjeev Aggarwal Managing director, Amplus Infrastructure

ast year, many states including Tamil Nadu, Rajasthan, Andhra Pradesh and Delhi had raised power tariffs, while there are such proposals in other states as well for higher electricity charges,as a country, should we be happy with the increase in power tariffs? The industry and banking system seem to agree. But the same question has many answers depending upon which side of the value chain you are. There are many stakeholders here: generation companies, distribution companies, consumers, regulators, politicians, and India. As generation companies, IPPs and their capital providers find it justified enough that the tariff should increase to keep their purchasers bankable. What it means is financially robust distribution companies and consequently their ability to pay in full and on time to the IPPs. Fair enough to attract investment in the generation business. The distribution companies also find better cash-flow position, lesser working capital requirement, timely debt servicing, etc. They also find it easier to raise capital for further capital expenditure and O& M activities. What about the consumers? On the face of it, we believe that consumers will never be happy with increasing tariffs but if you really look deep, electricity is no more an optional consumable; it is a necessity and people are willing to pay higher costs. The caveat is that the price increase should be coupled with increased reliability National T&D losses and service. This is the reason that while political parties seem to be making a big issue out of the increased tariffs in Delhi,

26.4 % 12

but the general consumers seem to be much happier than 10 years before. The reliability and quality of power supply is much better. Unlike every other major town in India, there are hardly any diesel generators outside every shop or commercial establishment. However, if you consider the situation in some other states where tariffs are increasing but the quality of supply remains dismal, it is fair to understand consumer anguish. You pay more for an inferior product. Certainly not done. Now, finally a look at our country as a whole. The Indian economy is not doing as well as we all thought, considering the good days of 2004 to 2010. Part of the reason for our lower economic growth is lack of focus on manufacturing. Our so-called demographic dividend of young work force is being wasted in low paying and low skilled domestic services sector. If we need to track the path of Chinese economic growth and bring millions of people above poverty levels, it is imperative to focus on manufacturing.

The Indian economy is not doing as well as we all thought, considering the good days of 2004 to 2010. Part of the reason for our lower economic growth is lack of focus on manufacturing."

Electricals Today | June 2013

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Revision of tariffs will tackle financial problems of SEBs

part from many factors like labour laws and licenses, the manufacturing costs remain high due to high input costs including that of electricity. Our industry pays anywhere between 10 c/kWh to 16c/kWh, not even counting the cost of diesel generation during blackouts. Even then, the reliability and quality of supply is poor. Compare that with 7.5 c/kWh in China, 6.6 c/kWh in USA and 14 c/kWh in Germany. The difference in electricity prices explains part of the reason that it is cheaper to import goods from China than to manufacture locally. So, what is the right price of electricity for us as a nation? We need to recognise that our energy needs are pretty high and growing. At ~900 kWh/year, we are still one fourth of per capita consumption of China and one fifteenth of USA. Unfortunately, our domestic energy sources (including renewable energy sources) are not sufficient to meet the growing energy demand requiring energy import. We are not China and US with huge in-country energy reserves and significant ownership in assets abroad. Bottom-line is that as a country, we need to pay more for energy than what we are used to paying so far. This is a big challenge facing the Indian economy today. We

need to encourage our manufacturing industry that is struggling against the likes of China and Germany but we donâ&#x20AC;&#x2122;t have access to cheaper energy basket. The answer lies in being efficient starting from energy consumed in generation, using renewable sources to the hilt, reducing T&D losses and being energy efficient in consumption. The renewable energy from wind and solar, with proper battery back-up, is expected to be competitive with fossil fuel fired plants in the time frame of next three to five years. Indiaâ&#x20AC;&#x2122;s AT&C losses, that include losses incurred during electricity transmission and theft, are estimated at about 26.4 per cent on a national average. Compare that with countries in Europe and United States of America that have T&D losses of about six to eight per cent. Japan and Germany have reported losses of four per cent. Russia and China have reported losses of 12 per cent and 7 per cent respectively. The regulators and distribution companies ought to focus on this aspect and bring in the efficiencies in the beleaguered transmission and distribution services.

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cover story / Distribution

Electrifying Maharashtra

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cover story / distribution

Once a power surplus state, Maharashtra has dipped to energy deficiency level of 18% in the last decade. Now, it has bounced back with deficiency at sub 3% levels, resulting in no power cuts in the state

BY ET Team

s mercury levels soared, a majority of the states grappled with power shortages, compounding the woes of consumers across the length and breadth of the country. However, Maharashtra stood out. The state not only managed to provide uninterrupted power for most of the summer months but it also streamlined power supply to the agricultural sector. This is not all, the state has also witnessed transformation at large in terms of technological implementation in enhancing efficiency in the electricity segment, thanks to Ajoy Mehta, MD, Mahavitaran. Mehta, who has spearheaded the distribution company for the last four years, put things in perspective: “Privatisation of the utility in different circles, concerted efforts on curtailing theft, billing regularisation, sorting out metering issues, etc. have paid off at last.” According to Mehta, there were two major challenges which severely hit the power segment in the state but he was able to surmount them and turn around the discom company in a relatively short time. The first major challenge was the problem of capacity addition. The state reportedly had power cuts/ load shedding ranging between six and seven hours in the past decade. The distribution utility offices were attacked almost every day when there were long hours of power cuts. “The energy shortage at one point of time was 18 per cent and now it is below 3 per cent. You cannot run a power company with such huge energy deficiency. Bringing down the deficiency was the biggest challenge. " The second biggest problem was losses, adds Mehta. "That time the losses were 35-35 per cent. Today, we are down to 16 per cent. That is another huge achievement,” pointed out Mehta while explaining how the transformation really took place in the state. What we saw was a makeover in less than five years. For the first time, Mahavitaran has put consumer at the centre. The aim of the utility was to put the consumers at ease while doing business with Mahavitaran. Unlike any other product, one uses electricity every minute on a daily basis. As a first step, the bill payments were made easy with the opening up of multiple channel options, including online payments. In the second step, the company made efforts to make bills error free. A lot of technology, in terms of IRR (infrared radio meter) and RF (radio frequency) meters were introduced. According to Mehta, it was not a smooth process. For starters, perfect meter reading did not go down well with a majority of the consumers who were used to tampering with meters. However, though it took time, consumers understood and appreciated that, like other measures that Mahavitaran had taken, this too was a step in the right direction.

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cover story / Distribution

A man for all seasons Mahavitaran MD Ajoy Mehta can claim to have seen it all, at least as far Maharashtraâ&#x20AC;&#x2122;s electricity sector is concerned. Mehta, who has played a key role in revamping the sector, talks about the power situation in the state interviewed BY renjini liza varghese

joy Mehta, a 1984 batch IAS officer, took over as managing director of the Maharashtra State Electricity Distribution Company Ltd (MSEDCL or Mahavitaran) in February, 2009. Prior to this, Mehta was at the helm of Maharashtra State Power Generation Company Ltd (Mahagenco). He also holds charge as managing director of Maharashtra State Electricity Board Holding Company Ltd, the holding company that was created when the erstwhile MSEB was spilt up into four companies in 2005. And by dint of his assignment at MSEDCL, Mehta is also on the board of the restructured Ratnagiri Gas and Power Pvt. Ltd, formerly Dabhol. In addition, he holds charge as energy secretary of the state as well. So, in a sense, Mehta has seen it all. His major achievement is generation capacity addition in the state. Excerpts from an interview: What are some of the key challenges facing electricity distribution and utility companies? And how do you manage these challenges?

14,500 MW Maharashtra's demand today

I think bridging the gap between the demand and supply of power, strengthening infrastructure, reducing losses, recovery, better consumer services and giving affordable power to all 24X7 are some of the key challenges at the moment.

As to how we manage these challenges, first of all, thank you for recognising our efforts. Yes, we definitely have come a long way from where we were three to four years ago. Maharashtra was not the only state which was facing heavy load shedding because of non-availability of required quantity of power but other states too were facing difficulties. This was a national phenomenon. We did short-term and long-term planning. At that time, demand for power was about 16,000 MW. Twenty five per cent of this 16, 000 MW was from the agriculture sector. There are about 41,000 villages in the state of which, 30,000 villages are agriculture dominated. We all are aware that the gestation period for any new capacity addition in public sector is about four to five years. Thus, we realised that in order to get early relief, demand side management (DSM) will have to be resorted to. So, as a short-term measure, we decided to go for a single-phasing scheme. Subsequently, we also implemented feeder separation programme in agriculture-dominated areas. This helped us manage the demand from this sector by about 2,500 to 3,000 MW. We have made arrangement for power from Mahagenco, the central sector generating stations and the private sector through long-, medium- and short-term power purchases. All short-term purchases are through fully secured e-bidding processes. All this has helped us reduce the load-shedding hours in a phased manner. With the full support of the government of Maharashtra, we have adopted a philosophy of higher load shedding in areas where recovery is low and losses are high. This has yielded very good results in bringing community pressure to reduce the

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cover story / distribution

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cover story / Distribution

We have adopted a philosophy of higher load-shedding in areas where recovery is low and losses are high. This has yielded very good results in bringing community pressure on defaulters. As a result, today, 82% of Maharashtra is loadshedding free."

losses. The community now jointly endeavours to reduce losses, so that they can also have uninterrupted electricity. Today, 82 per cent of Maharashtra is load-shedding free. The present demand in Maharashtra is about 14,500 MW. Though we can meet this demand, we provide about 13,750 MW to 14,000 MW of power which leaves a gap of 500-750 MW. Therefore, now in Maharashtra, power is available to all, provided the losses are in limit and the bills are paid by the consumers regularly. What is the T&D scenario in Maharashtra looking like? How do you plan to manage T&D challenges? It is true that Mahavitaran inherited T&D losses to the tune of 35 per cent. But the situation is totally different now. Distribution losses have come down to 16 per cent in the last financial year and we are planning to reduce it further by at least 1 per cent in this fiscal year as per target given by MERC. We could manage this only because of our deliberate, planned and sustained efforts. Theft of power adds significantly to distribution losses. Recognising this, we undertook a massive drive against rampant theft of power. Earlier, we had 36 flying squads to detect theft cases while our O&M staff was not part of the anti-theft drive. We increased the flying squads to 120 and began involving our O&M staff in this activity. We established six dedicated police stations for anti-theft cases. Now, our O&M staff regu-

larly conducts anti-theft drives.

s a strategy, we have linked up losses with load-shedding relief. This is also helping us to put pressure on the masses to reduce losses. We are implementing mass meter replacement plan throughout the state. We are going for radio frequency meters in urban areas and IR meters in rural areas. Four to five years ago, we were purchasing about four to five lakh meters annually. Now, we are purchasing about 25-30 lakh meters annually; thatâ&#x20AC;&#x2122;s how much our metering has gone up. We are aggressively moving towards using automation and technology to reduce human interference in metering. We have already completed metering of all feeders and DTCs. This helps us identify theft-prone areas and assign responsibilities. How much did MSEDCL spend on upgrading its distribution network? A major challenge for any distribution company is infrastructure. Weak and old infrastructure is a problem limited not only to Maharashtra; it is faced by almost all the states. Given the paucity of funds, we had to string out the renovation of our distribution network for years together. As available generation kept on increasing, it became imperative to upgrade the infrastructure

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cover story / distribution

to handle the additional power. With the financial support of REC and PFC, Mahavitaran implemented massive and ambitious infrastructure plans to strengthen its distribution network with the investment of Rs11,000 crore. This has helped reduce the technical losses significantly. About three years ago, the network had only 1,800 substations of 33/11 kV which were vintage. We added more than 625 substations in the last three years. In addition to substations, a large numbers of DTCs and HT lines were also added. Now, the second phase of infrastructure plan of Rs6,500 crore is being planned so that we can distribute about 25,000 MW of power by 2020. Over the years, Mahavitaran’s losses have come down significantly. How did you achieve this? Reduction of distribution losses is a major challenge for any distribution utility. In the year 2004-05, our losses were about 35 per cent. To reduce commercial losses, we resorted to regular anti-theft drives and established dedicated police stations to handle theft cases, energy accounting of feeders, DTC metering, mass meter replacements, tracking doubtful consumers, shifting meters in the front of the house and restrict supply in theft prone areas. A special all-women squad was set up to check irregularities in meter reading. Infrastructure development helped MSEDCL to reduce technical losses. Because of all these initiatives, our losses have come down to more reasonable levels. Mahavitaran’s losses in 2011-12 were 16 per cent. By the end of this financial year, we expect to reduce it by another percentage point as mandated by the state regulator (MERC). What is the situation on the revenue recovery front? The existence of distribution utility is dependent on the recovery of bills raised. Nowadays, it is a common practice that if the power bills of the generating company are not paid on time, they will not hesitate to discontinue power supply. That’s the reason why instruments such as the LC and escrow became the alternate currency in the sector. In Maharashtra, our collection efficiency is about 97 to 98 per cent. Our policy to implement more load-shedding in non-paying and high-loss areas is also helping us maintain good recoveries from consumers. We are extending all possible help to consumers to pay their bills on time and regularly. They can make payment online or even through SMSes. We have also installed ATP machines in all major cities. Payment facilities are also available at district co-operative banks, co-operative housing societies and post offices along

with the regular departmental cash collection centres.

e are in an era where the consumer is king. Today, consumers are ready to pay for the services irrespective of the service provider, whether it is private or a public sector utility. After restructuring, there is a definite change in the attitude of the employees, but it is still short of the expectations of the consumers. We are regularly conducting workshops to make them aware about their responsibilities and accountabilities towards the consumers. To improve consumer services, we have established centralised 100-seat customer care centre at Bhandup, Mumbai. We are closely monitoring different types of complaints here. We have also simplified the new connections procedure with the introduction of the single page application. Earlier, they were supposed to give us different types of documents. Now, consumer needs only one proof each of identity and residence.

500 MW

What is the power scenario looking like in future and what are the key hurdles Shortfall in Maharashtra ahead? With the improved power situation, almost 82 per cent of the state is now load-shedding free. Maharashtra is now able to meet nearly 96 per cent of its energy needs. Industrial feeders in Maharashtra are supplied power 24x7, unlike other states. Agriculture is supplied assured power of eight hours during day time and 10 hours at night. Maharashtra has adopted a strategy of carrying out staggered load-shedding only in areas with high losses. Presently, 500 to 700 MW load-shedding is done only on those feeders with more than 42 per cent distribution and commercial losses. The high-loss feeders are identified and efforts are being taken to reduce losses on these feeders so as to enable withdrawal of load-shedding. In the last five years, the demand supply gap for base load energy has reduced from 18 per cent to 3 per cent and Maharashtra is load-shedding free in terms of availability. What are your power procurement plans? Mahagenco (MSPGCL), the state government-owned generation company has added 2,500 MW in the 11th Five Year Plan and

If the power bills of the generating company are not paid on time, they will not hesitate to discontinue power supply. That’s the reason instruments such as the LC and escrow became the alternate currency in the sector." June 2013 | Electricals Today

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cover story / Distribution

The present demand in Maharashtra is about 14,500 MW. Though we can meet this demand, we provide about 13,750 MW to 14,000 MW of power which leaves a gap of 500-750 MW. Therefore, now in Maharashtra, power is available to all, provided the losses are in limit and the bills are paid by the consumers regularly. "

further envisages a capacity addition of around 9,250 MW in the 12th Five Year Plan. Also, under the competitive bidding process under Case-1 Stage-1, MSEDCL has tied up 2,300 MW and under Case-1 Stage-2 it is 2,600 MW power from different IPPs. There is a major shortage of domestic coal for the plants in Maharashtra. During the last fiscal and current year, we are facing a shortfall of 25 per cent in coal supplies from indigenous coal companies. This has led to a generation loss to that extent from MSPGCL power plants. There is also a shortfall in production level of administered price mechanism (APM) gas and RIL gas. This has resulted in a major shortage of gas to the existing Uran and Ratnagiri gas power plants. Besides loss of generation, the drop in gas supplies can lead to an increase in generation costs. As a result of low generation, power tariffs of RGPPL are unviable at current levels. Despite these short-term problems, because of our planning, we may be in healthy power situation in the coming years. Maharashtra is almost self sufficient in power today and will be a power surplus state from the current financial year.

With inputs by Arundhati Bakshi-Dighe

Electricals Today | June 2013

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Generation / Fuel

COAL HUNT 22

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Generation / Fuel

Despite measures taken to boost domestic supply, India’s dependency on imported coal is increasing by every passing day. The country’s import is expected to touch 150 MT by 2014

40%

of world’s electricity is from coal

BY RENJINI LIZA VARGHESE

he energy growth of a country is directly proportional to the economical growth. In India, it is assumed that if the country registers a growth rate of eight per cent, then the energy growth needs to be in double digit. Coal-based power tops the chart as the highest fuel source. The rationale is that coal comes as a cheaper fuel option than oil. According to the International Energy Agency (IEA), “Approximately 40 per cent of the world’s electricity needs were provided by coal as on March 2012. Coal is the second source of primary energy after oil and the first for power generations.” The dependency on coal to meet the energy demands is on the rise, especially, in the emerging countries. India consistently registered demand growth both in domestic and international coal. Coal registers the fastest growth from the beginning of this century as more and more countries are looking at developing thermal power plants. Globally, the energy demand rises by over one-third in the period to 2035, underpinned by rising living standards in China, India and the Middle East.

Coal is the major fuel used for generating electricity worldwide – countries heavily dependent on coal for electricity include: Countries

Percentage of coal based power

South Africa

93%

Poland

90%

PR China

79%

Australia

76%

Kazakhstan

70%

India

69%

Israel

63%

Czech Republic

56%

Greece

55%

Morocco

55%

USA

45%

Germany

44% Source: World Coal Association

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Generation / Fuel

The rising demand for electricity in emerging economies is driving 70 per cent of the increase in worldwide coal demand. Interestingly, energy from renewable sources accounts for half of new global capacity. In the world energy outlook 2012 by IEA, it highlighted the major factors that lead to an unsustainable energy growth. First and foremost it points out that the fossil fuel subsidies have gone up by almost 30 per cent to $523 billion in 2011, led by MENA. The CO2 emissions were at record high, while renewable energy industry was under strain. Despite assertive and insistent international efforts,1.3 billion people still have no access to electricity. World electricity generation fuel-wise

Projected for 2030

Coal Gas Hydro Nuclear Other* Oil

38% 30 % 13 % 9% 6% 4%

out Scott Dendy, business development manager, IHS, Asia. “Indian power plants burn sub 6,000kcal coal. The energy value in this segment coal is less. Asian countries opt for this mainly because of the cost effectiveness but this grade coal has high ash content. 6,000kcal is an old bench-mark set by the European countries. But, there is change in the trends of traded coal. The major market is shifting to Asia and the estimate is that Asia will continue to be the focus for next 15 years. In the past five years, the concentration of coal market was China-centric. But the focus is moving to India,” he added.

* Other includes solar, wind, combustible renewable, geothermal and waste. (Source: IEA)

hough India is a coal producing country, but with the aggressive capacity addition plans in place, the coal imports are swelling. State owned Coal India Ltd (CIL) is the sole supplier of coal in the country. The rise in demand for domestic coal is 10 per cent every year and the output goes up only three to four per cent. There is indeed a demand supply mismatch. Starting from the 11th Five Year Plan, CIL periodically has expressed its inability to meet the ever-rising demand from the power sector. Environment clearance delays have hit CIL’s output in a major way. The supply constrains have put the thermal power plants with as low as three days of fuel stock in the last year. So along with the aggressive capacity addition plans, in the 12th Five Year Plan (2012-2017), the government has asked the generators to look at blending of fuel. Typically, in India there are three kinds of power plants a) those which run on 100 per cent domestic coal; b) the ones that run fully on imported coal (the ultra mega power projects for example); c) those opted for blended coal in the approved ratio. Realising the intensity of the problem, the central electricity authority (CEA) has advised the project developers to plan for blended coal provision from the planning stage of the project itself. The first approved blending ratio was 85:15, which was increased to 80:20 and now touching almost 65:35. The said reasons for this sudden increase is majorly because of the nonavailability of the fuel followed by the deterioration in the quality of coal. Recently, Arup Roy Choudhury, CMD, NTPC, the largest thermal power producer in the country, has alleged that the coal supplied by CIL is not up to the mark. “This is not a Indian scenario alone, globally, we are witnessing deterioration in the quality of coal. May be we have used the best quality coal already,” points

India is the fifth largest coal producer.

Globally, the energy demand rises by over one-third in the period to 2035, underpinned by rising living standards in China, India and the Middle East."

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Generation / Fuel

ndian coal has higher ash and low moisture, but heat value is less so, it is not really comparable to international coal. “Even after washing, Indian coal is cheaper compared to imported coal. The Indian coal has very high ash content and washing removes the inconsistencies in quality and improves heat value. For instance, if a 4,000 kcal/kg GCV coal has 34 per cent ash, then washing can lower the ash content to about 28 per cent. It is a natural mined product so one cannot really alter the specifications. Currently, only four per cent coal is washed in India because it is not mandatory. At present, some power plants are using 15 -19 per cent of imported coal to blend with domestic coal. About two years ago, CEA had recommended that all new power plants should have boilers designed for blend ratio of 30:70 (or higher) imported/high GCV coal indigenous coal because coal imports will rise going forward,” said James O’Connell, Editor-in-Chief of coal, Platts. Over 50 countries produce coal which is being consumed by 70 countries. Interestingly, only 15 per cent of the total produced coal is traded. The balance is consumed by the coal- producing country itself. For e.g; India is coal-producing country, at the same time an importer of coal as well. Top exporters of coal

Top importers of coal

Indonesia

PR China

Australia

Japan

Russia

South Korea

USA

India

Colombia

Taiwan

South Africa

Germany

Kazakhstan

For power- starved country like India focus and dependency on imported coal will continue to rise. “The import in 2012 was 123 MT and this year it will be 138 MT. And our expectation is that the import will touch 150 MT in 2014,” pointed out Dandy. Issues hindering the coal production domestically are compelling the power producers to explore new options. “Some of the Indian companies have acquired coal mines in Indonesia and South Africa. Close proximity made Indonesia the first choice. However, the change in taxation and escalation in international prices made the option financial unviable,” he added.

tilities such as Adani Power, Tata Power, JSW Energy and state-run NTPC, are among the biggest consumers of imported coal. Despite its abundant reserves of about 286 billion tonnes and being the world's fifth-largest producer, coal production in India has failed to keep pace with demand from utilities for several years now, leading to severe power shortages. The country has crossed 200 gigawatts (GW) last year and more than half of the installed capacity from coal burnt plants. According to the reports available, more than 20,000 MW of installed capacity is based on 100 per cent imported coal. In 2012, the international coal prices have gone up consid-

The rising demand for electricity in emerging economies is driving 70 per cent of the increase in worldwide demand. Interestingly, energy from renewable sources accounts for half of new global capacity. " erably, distressing on the finance outflow. According to data released by the government, the has country forked out about $15.5 billion for the commodity in the year ended March 31. However, in the previous couple of weeks the international prices have eased significantly. It is a world of bears at the moment. The international market is soft compared to last year. “The dip in international prices may continue for some more time, owing to more supply availability and decrease in demand from US and China,” pointed out Dandy. The other major issue which worries the Indian power generators are the news of Indonesia putting a ban on the export of power grade coal from the country. Indonesia, a power deficit country, is actively contemplating on using the power grade coal to develop power plant domestically. This law it is believed, will not be applicable on those foreign companies who have bought coal mines in Indonesia and this seems the reason behind move. Nevertheless, analysts are of the opinion that the buzz of coal ban from Indonesia will continue for some time before it fades out completely. According to the World Coal Association, there are two methods to assess the balance coal reserves in the world. The first one is produced by the German Federal Institute for geosciences and natural resources (BGR) and is used by the IEA as the main source of information about coal reserves. The second one is produced by the World Energy Council (WEC) and is used by the BP Statistical Review of World Energy. According to BGR there are 1004 billion tonnes of coal reserves left, equivalent to 130 years of the total mined coal is only traded internationally of global coal output in 2011. Coal reserves reported by WEC are much lower 861 billion tonnes, equivalent to 112 years of coal output. Since the government does not put out any data on coal imports, there seems to be no control over the quantum of coal bought into the country. That means more and more Indian companies are readying for shopping abroad to ensure fuel supply for the power plants.

15%

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Generation / finance

Waiting for the right opportunity

Lack of clarity in electricity policy at the national level forces leading power generators to put their expansion plans on hold BY ET TEAM

ll is not well as it is projected to be with power generation sector. On one hand, companies are fighting the fuel supply issue, on the other hand some others are trying to fix the tariff issue. However, the interactions with the power companies are revealing an entirely different story. A number of power companies have improved the performance in the last quarter owing to the dip in international coal prices. The escalating coal prices have come down to rational pricing levels in the last few months. JSW Energy, promoted by Sajjan Jindal, during the annual results announced that the company has no projects in pipeline. This is a pure reflection of the power sector sentiments. The lack of clarity at the policy level is forcing companies to go slow on their plans or hold on to the cash reserves. It is true that this also means that the companies may actively look at acquisition rather than new projects. According to the chief executive officer, JSW Energy, Sanjay Sagar, “The company is looking for good and viable opportunity. Power plants with a size of over 1,000 MW and above will be the option we will be zeroing down on. We have a cash chest of around Rs900 crore as on March 31, 2013.” Majority of the power sector companies are voicing for a pass-on of fuel price to the Average realisation/ unit consumer. This means, there needs a change in the bidding structure. India follows the fixed tariff structure (L1 bidding process). Under this bid, it allows the companies (the bidders) to quote

Rs4.13

low tariff while bidding for the project. In the recent past, leading generation utilities in the private sector had approached the Central Electricity Regulatory Commission (CERC) highlighting the projects financial un-viability due to unforeseen escalation in fuel price in the international market. The Commission has given an order in favour of the power companies in the said matter. That does not give a leeway to the power companies to stick on the fixed tariff while bidding and get a relief in a future date. “While we say the fuel price fluctuations should be a pass on, I am not asking to scrap the L1 bidding process,” said N K Jain, vice-chairman, JSW Energy.

Pricewise, the southern region looks positive. The tariff which is better than other states continues to sustain in the region or continue to increase. This helps generators like us who do not have long-term PPAs in place," says Sanjay Sagar.

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Generation / finance

JSW's total capacity has reached 3,140 MW.

hat power sector analysts point out is a complete change in the bidding process, where tariff determination will be a pass through. That means, if the fuel price goes up, one will shell out more for electricity and if the fuel price comes down then, consumer gets the benefit. A similar scenario of what is exists in petroleum pricing in India. The indications are that the power sector, may be not immediately, but also heading in the same direction. It is true that majority of the states are reeling under power shortage. The two states which boast of being power surplus are said to have asked the generators to back down production even in peak summer. JSW officials say that the demand dip in electricity is a mirror image of the slowdown in economy. While states like Maharashtra refutes this by highlighting the growth registered in the last three years. The state has registered a CAGR of 9.5 per cent consistently for the past few years. Though the country has power deficiency, the merchant power tariff hasnâ&#x20AC;&#x2122;t showed any improvement even during the summer. This is not a positive sign for those generators who sell more than 50 per cent of their produce in the market. But the buzz is that the merchant power rates may pick up during the election. One may recall that, during the last parliament

election the merchant price have touched Rs14 and Rs17. That may sound a bit exaggerated though, the expectation among the power producers is that, inching closer to the elections will surely bring in improvement in pricing. The southern grid yet to get connected to the national transmission grid, is playing a spoilt spot, points out an analyst. He continues that the southern discoms are quoting better price. But the lack of infrastructure is a major hurdle. â&#x20AC;&#x153;Price wise southern region look positive. The tariff which is better than other states continues to sustain in the region or continue to increase. This helps generators like us who does not have long term PPAs in place,â&#x20AC;? said N K Jain. Average realisation currently stands at Rs4.13, he added. According to the report by Karvy, the stock broking firm, JSW Energy (JSWEL) continues to remain exposed to imported spot market and merchant power rates. This results in the balance sheet of the company from quarter to quarter. This is not the case of one company alone, it applies to all those companies which have higher exposure to imported call. To sum it up, those companies who entered the power segment with high return expectations are forced to re-look at their strategies to minimise losses.

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generation / Solar

INNOVATIONS DRIVE SOLAR M 28

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generation / solar

Maharashtra, though not successful in attracting investments in solar like Gujarat and Rajasthan, is innovating with designs to woo more business BY KAUSTUBH KULKARNI

S R MARKET

he rising demand for power and delays in setting up conventional power plants is mounting the pressure on both the government and private players to harness non-conventional energy resources. To give a boost to the said plan, the government has come out with supporting schemes to lure more players to the renewable energy segment. Be it be solar or wind, the two major contributors in the renewable energy basket. 2010 announced National Solar Mission had given the needed thrust to the state governments and the private companies to take off in a bigger way in solar. Indian companies and their partners are powering ahead with innovative solar schemes. Maharashtra is stated to have a high potential in solar. However, lack of a supporting state-level solar policy is a hindrance to the investments. An encouraging solar policy will not just enable private players to invest and contribute in reducing the power-deficit, it also will bring in innovative solar products into the market. The present policy encourages the rooftop installations which are catching up. The few companies which entered the segment, brought along with them unique structures with aesthetic value too. From companies to academicians, the research is on to innovate with designs to harness the available energy to the fullest. From solar lightings to solar cookers to solar water heaters to, now, solar panels on the rooftop. On the commercial side the solar farms have grown from 1 MW size to 25 MW and above now.

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generation / Solar

he demand for fuel is on a rise, this has make the students of Potti Sriramulu Chalavadi Mallikharjuna Rao College of Engineering and Technology to look at the alternate energy. The students wanted to look at the green energy. K Vamsi Srinivas, P Murali Krishna, E Anand and Y Vinod Babu of final year Electrical and Electronics Engineering designed a multipurpose ‘solar car’. When not in use, the solar car can be used for meeting the electricity needs of a house. This also can double up for operating agricultural pumps. The vehicle Solar car could run for 10 hours at 35 km speed if charged for five hours. In case of emergency, the batteries can be charged with conventional power too. The innovations are not stopping here, now, the students are exploring the ways to tap wind energy while the vehicle is on the move. They are optimistic that, this will improve the mileage and battery capacity. Designed in 45 days, the total investment is Rs70,000.

STATE INITIATIVES

A solar plant in Maharashtra

he state owned Mahagenco is also tapping the potential of solar power. They have come out with unique models to promote investment in the segment. Mahagenco is looking at to build, operate and maintain solar power plants. As per the model, a selected private developer would have to raise finances, set up a solar power plant, and maintain it while generation of power from the asset will remain in Mahagenco’s books. However, the choice of technology lies with the developer. The developer can either choose between solar thermal (which converts radiation into heat using either air or other fluids) or solar photovoltaic (PV) that uses PV cells to convert light directly into electricity.

aking into consideration the land acquisition constraints in India, Tata’s innovation of floating solar plants can change the face of solar industry in the country. Tata has zeroed down Mulshi in western Maharashtra for the implementation of the project. A similar project is also being built in Gujarat on Narmada Dam. Mulshi also houses Tata Power’s three MW PV power plant. Floating solar modules help to keep the water clean and also prevent the water evaporation to a greater extent. “This is an exotic idea,” says energy expert adv. Suhas Tuljapurkar. “There a higher need for small projects like the roof top installation in Vidarbha and Marathawada region to power the remote rural houses. Western Maharashtra is on the wind map of the country. It is now necessary to install solar projects in regions that have ample sunlight, like Vidarbha,” Tuljapurkar added.

Floating solar panels

pilot project with PV-powered greenhouse is being developed in Maharashtra currently. The project is developed by PR Fonroche, a joint venture between PR Clean Energy and a Solar greenhouse France-based solar company Fonroche Energie. The integration of two different segments in the green house is expected to address the two major issues of land and power in one go. Innovations are happening, but lack of clarity in the policy levels is pushing innovations to back seat,” said Sanjay Pathak, of Sanjay Marketing, Mumbai. But he is optimistic that an accelerated policy in solar energy can give the right boost to innovations as well. When it comes to putting into action, Mumbai leads first. One of the suburban society in Mumbai-- Sea Line Co-operative Housing Society, has constructed a solar power plant. The common area and stairway in the society consumes only solar power. They used rooftop solar module with a tracking system. The tracking system tracks the sunrays and moves the panels accordingly. Hence, from sunrise to sunset the panels receives light, that is almost 12 hours a day.

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generation / case study

SPARkLING BEARINGS SKF India's solution factory remanufactures large bearings of power plants, increasing overall life cycle and enhancing efficiency BY ET TEAM

he technological advancement has enhanced the operations in all the three segments of power sector, viz; generation, transmission and distribution. While the common man is aware of the newer technologies/advanced equipments which are visible to them, these are equipments or instruments which are seen by them at the consumer end. This does not mean that in the transmission and generation segment there is no major change in terms of technology. The improvements have enabled both the segments with easy and earlier detection of trouble shooting, reduction in time for fixing the problem, lowered the maintenance period, etc. It may leave you wondering what is new in the above said, read on. Solution factory a fairly new concept from SKF â&#x20AC;&#x2DC;solutions factoryâ&#x20AC;&#x2122; is catching up fast in India. Frequent break-downs of equipments is a common problem faced by the power generators globally. Conditions leading to a forced unscheduled shutdown from this are a headache for the generation utility. At the end, this kind of shutdown affect overall performance of the power plant negatively. It is understood

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generation / case study

The process involved in a thermal plant.

that the generator is benefited only when the power plant is The overall performance of a power plant depends on run at its maximum capacity, giving higher plant load factor various factors like a) working condition of the boilers, b) avail(PLF). ability of fuel, c) efficiency in fuel handling in the plant area, Typically, the Indian generators were following the and d) minimum shutdowns for maintenance. In general, the time based maintenance. Under this condition, country in the earlier days had small power generation facilimaintenance of the plant is carried out in a ties which were predominantly owned by the government. schedule which was drawn according There witnessed a paradigm shift, from government-owned to months/years (time) of operato the private-owned power plants. Size of the plants also is tion. However, frequency of bigger than before. This means, the consequence of a partial breakdown reporting has shutdown in the current scenario will be far bigger than the Savings per year for the utility started rising. A shutdown earlier periods. directly brings down the output ime is money, it is 100 per cent true with the power plants. of the plant thus toppling overall So it was imperative for the large generators to bring in efficiency. Financial viability of the plants is solutions before the problem could arise. “The shift we are seecalculated on the basis of maximum performance. ing is that the Indian These shutdowns resulted in an increase utilities are moving in operational costs. away from timeThe situation has made the utilities to look based maintenance for solutions to reduce maintenance costs and to condition based improve the overall efficiency of the plant. This maintenance. This is where the Solution Factory plays a crucial enables the operator role. “Many a time, we came across utilities to identify problems which were fighting to find one stop soluwell in advance,” said tions for its long-lasting issues. This concept Kundan Dave, segwas introduced to help reduce unplanned ment manager, power, maintenance issue that hits the performance SKF India. of a power plant,” said Deepayan Das, general Usually, in a power manager- strategic customer sales, SKF India. Vibracon a new generation bearings from SKF.

6-lakh euros

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generation / case study

Before After

Remanufacturing of the bearing improved its life by 50%. Benefits of remanufacturing of large size bearings

plant the major issues arise from the bearings. Bearings, though a small component, plays a crucial role in every point in a generation plant. All the bearings come with a life time, however, no bearings achieve the full life span. To explain it better, let me give you a case which we solved successfully and satisfactory to the clients expectation, elaborated Dave. “A generation utility approached us with the aim of reducing maintenance costs by 2.5 per cent each year. The analysis showed that the bearings in the conveyor drums and gearboxes needed attention. We took it up and through programmed remanufacturing, covered 60 per cent of the installed bearings. End result, the company was able to achieve the target of reducing the annual maintenance cost which was denting the balance sheet.” Before any work begins, SKF experts inspect each bearing, determine if remanufacturing is possible, and issue a comprehensive bearing analysis report.

Many a time, we came across utilities which were fighting to find one-stop solutions for its long-lasting issues. The concept of ‘solutions factory’ was introduced to help in reducing the unplanned maintenance issue that hits the performance of a power plant,” says Deepayan Das.

Save up to 50% of the cost of a new bearing Extend bearing service life by 50% or more Reduce CO2 emissions by 80% versus manufacturing a new bearing Timely availability of large size bearings Improve uptime by increasing machine availability

This report can help plant maintenance proactively correct root causes for premature machine failure and extend the service life of the asset. What ‘solutions factory’ did here: a) the bearing failure analysis to gauge the remaining life of the bearings. They removed the bearings, did a criticality analysis to find out the root cause of the failure, b) ultrasonic wave analysis helped them understand, whether the bearing can be recovered through remanufacturing thus achieving the life time. Once the evaluation process was over, ‘solution factory’ factory suggested the utility to remanufacture the bearing which the company opted for after evaluating the financial implications. “As a practice, we at ‘solutions factory’ advises the clients to look at remanufacturing of bearings. This helps them in many ways-- cost wise, less time in comparison to installing a new bearing, and decrease in shutdown time,” Dave explained. “The savings per year for the utility was 6,00,000 euros. Which was commendable,” he added. Any technology comes with a price tag attached to it. Dave summed it up by saying, “Yes, there is an additional investment required in the initial stages. But the savings by avoiding an unwarranted shutdown is much higher.” The frequency of the failures in a power plant can depend on the maintenance practise of the utility, varies from utility to utility. The highly contaminated coal-handling area bearings have higher chances of failure in comparison to the other segments of the plant. Putting in place sensors and regular monitoring can enhance the efficiency of a power plant.

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transmission / smart grid

Resilient grids It is believed that the best way to fight grid instability is to implement smart grids. All stakeholders are pushing for speedy execution of the programme BY RENJINI LIZA VARGHESE

t is not only the scorching heat which is bothering Indians this summer, but also the fear of the near blackout situation like the last year. Last summer the country had to brace through an unusual event of a grid collapse. The northern grid failed, and it took almost three days for the utilities to bring back the supply to normalcy. The stated reason was the overdrawal by some distribution utilities to meet the higher demand. There were debates on the reason behind the collapse, the possible corrective measures and the ways to avoid such situations. According to the union power minister Jyotiraditya Scindia, corrective measures have been put in place to avoid a repeat of what happened last year. He also stated that the grid volatility curve to a great deal has flattened out in the last four - five months because of corrective steps. â&#x20AC;&#x153;It (grid collapse) happened not because of the central government or because of all the state governments. It happened because we didn't stick to the rules. If you don't follow the rules of overdrawal, then you introduce greater volatility in the grid. And the moment you have huge squeeze of volatility in the grid that ultimately can lead to a grid collapse and that is what happened," said Scindia. According to experts, smart grids can prevent similar eventualities to a greater extent. It is believed that the smart grid applications once implemented will enhance the utilities to regulate the sudden rise in demands. Following the grid collapse incident, the

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transmission / smart grid

zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz Smart grid helps in studying consumer patterns.

Globally, consumer involvement is key to the success of smart metering and smart grids in any country. And a well-defined countrywide regulatory framework acts as the backbone of implementation." different stakeholders in the distribution space are looking for a faster execution of smart grids at the national level. However, there was very less movement seen in this direction in the past one year-- not overseeing the sanctioning of 40 pilot projects in the country. The smart grid is not just the implementation of technology; it is more about having a vision, objectives, processes and involvement of all stakeholders including consumers. A national roll of the project requires large investments and coordinated efforts/ working between the different stakeholders in electricity segment. “Policy makers need to adopt a comprehensive approach towards this. Several countries around the globe have mandated smart metering and smart grid implementations with defined objectives and timelines. Funding needs have also been clearly identified and addressed. The driving entities have also been identified and directed to produce results. A positive aspect of the Indian regula-

tory scenario is the incremental results based approach, where utilities demonstrate results with initial investments and then go on to larger investments in smart grids; said Dinesh Abhimanyu Rajan, principal consultant, smart metering and smart grids, energy, natural resources & utilities, Wipro. He also added that,“It would also help if technical protocols for meters and integration are rapidly finalised, to enable equipment and software manufacturers to commit their investments in building the capability to deliver. We have provided an infographic (in an appended document) which gives you an overview of our Smart Grid work across the world. It is clear where India is lacking when it comes to putting smart grid application into practice. However, there is no clear-cut road map in place at the policy level. Subbi Lakshmanan, vice-president & head – domain practices, energy, natural resources & utilities, Wipro, elaborated the argument by saying,“There are several reasons behind the slow pace of smart grid implementation in India. The first is the absence of a well-defined country-wide regulatory framework for smart grid implementation. Second is the lack of standardisation of technologies like meter protocols and integration protocols for smart equipment. The third is that utilities are yet to prepare themselves for such a major operational and organisational change. And, lastly, we need a framework for consumer involvement. Globally, we see that consumer involvement is the key to success of smart metering and smart grid implementations.” According to Vikram Gandotra, general manager (marketing) smart grid - energy automation applications, Siemens Ltd,“There will be more transparency and visibility in operation of grids which shall lead to benefits for consumers. In the long run, the customer will feel more empowered to match his consumption with his

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transmission / smart grid budget. And also reap the benefits of continuous availability of quality power. The electrical network will be more resilient and capable of being managed in a more dynamic and flexible manner. The new technologies shall help the utility managers to identify the leakages in revenue in a better way. The vagaries of renewable power sources such as wind and solar will be controlled by new technologies.â&#x20AC;? Smart grids will ensure a stable grid. This is very imperative at this point of time, as many states in the country have already started harnessing rooftop solar power. The announced state plans include two-way metering in the near future. â&#x20AC;&#x153;A stable grid that has the ability to effectively balance variations in demand along with distributed generations is a must for the success of rooftop solar projects. Distributed generation needs to be implemented not just as a supplement to address the gap between power demand and supply, but as an effort to improve reliability and locally contain problems,â&#x20AC;? added Lakshmanan. He continued that for an investor, a guaranteed uptake of the non-firm excess generation is an important consideration for financial viability. During outages, the roof top plants remain energised and may create unsafe conditions for both system owners and the

There will be more transparency and visibility in operation of grids, which shall lead to benefits for consumers. In the long run, the customer will feel empowered to match his consumption with his budget." utility workers. Well-designed standard interconnect agreement and safety procedures are necessary, but they do not fully eliminate the risks when there are frequent outages. According to his colleague Rajan, rooftop solar implementation may be handled by the existing grid when done on a small scale, and well distributed across localities. Larger scale and more concentrated implementations will necessarily require grid upgrades. In case of Kerala, the decision to go ahead with systems of 1kW per site, keeps the scale low and at the same time introduces standardisation across interconnects. During the past five years there been significant development in ICT implementations at Indian utilities. With the implementation of RAPDRP (Restructured Accelerated Power Development and Reforms Programme) projects, utilities have their foundation IT systems in place. Many utilities have reported reduction in their AT&C (Aggregate Technical & Commercial) losses by implementation of advanced technologies. In some cases the losses have come down from 40 per cent levels to sub 20 per cent levels, which is a considerable achievement. This is a significant first step as losses and availability are major issues for almost every Indian utility. How-

Regularisation of metering assissts utility in financial recovery.

ever, further focus and capital allocation towards smart equipment is required to contain losses to acceptable levels and provide the reliability and security that are the objectives of a smart grid. CERC (Central Electricity Regulatory Commission) has kept losses below 15 per cent as desired levels for the country. With several pilots demonstrating positive results, a full scale rollout of smart devices, both meters and distribution systems seems not very far on the horizon. Siemens, one of the leading equipment providers in the smart grid segment, named some of the most sought after equipments in the power sector after the technological evolvement happened. The intelligent SCADA DMS solutions system tops the list, as it helps to monitor the automated processes in the power sector. This was installed for several utilities across India (including MSEDCL, Torrent, Tata Power, CESC amongst others). According to the company it had improved the reliability of supply to the common consumers. Currently, one of the largest projects is in Maharashtra, where they are providing SCADA DMS solutions for eight of its largest cities under the R-APDRP programme. India for the last few consecutive years has been registering a CAGR of close to nine per cent in electricity. That means, the increase in demand is directly putting pressure on the distribution utility to meet the supply demand. For better reliability and for ensuring the quality of supply, all point to a definite need for modernisation of the grid. India has more than 100 utilities with each utility typically having a customer base of more than 8-10 million consumers. Majority of the utilities are state owned, and operate in regions with distinct and unique geographical and economic conditions. Being a price sensitive market, low cost, high impact and reliable solutions are what the country/market is looking for.

15 % target for T&D losses

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international corner

Greener on the other side Dubai Municipality’s new green building regulations are set to come into force in 2014, will transform the MEP industry in the Emirates BY ET TEAM

andatory green building rules and regulations on all buildings in Dubai are scheduled to be enforced in 2014. Currently, it is optional for private buildings. According to Dubai Municipality, the purpose of the regulations is “to improve the performance of buildings in Dubai by reducing the consumption of energy, water and materials, improving public health, safety and general welfare and by enhancing the planning, design, construction and operation of buildings to create an excellent city that provides the essence of success and comfort of living”. The regulations are intended “to support Dubai’s Strategic Plan, create a more sustainable urban environment and extend the ability of the Emirate’s infrastructure to meet the needs of future development”. Green building is clarified by the document as “the practice of creating structures and using processes that increase the efficiency of resource use — energy, water, and materials – while reducing building impacts on human health and environment during the building’s life cycle, through better siting, design, construction, operation, maintenance, and removal.” The rules and regulations cover all aspects of the construction process, with many having universal application to all parties involved. For example, Section 401.02 deals with air quality during

construction, renovation or decoration, stating that “building occupants and systems must be protected from airborne contaminants which are generated or spread during construction or renovation inside the buildings.” Other uniform measures tackle environmental tobacco smoke, the use of environmentally-friendly materials and resources, and the responsible management of waste generated by the various construction processes. However, at its heart, this document is a new testament for the MEP industry in the Emirate of Dubai. The bulk of its content deals with freshly defined standards for HVAC systems, electrical efficiency and lighting, and water efficiency through plumbing and drainage. Consequently, it is set to transform work practices and behaviours in the industry from the design and planning stage right through to testing, commissioning and maintenance. Section Four of the document, which deals with “Building Vitality”, has several points of interest for MEP practitioners. Its first chapter deals with ventilation and air quality, opening with the decree that “All new and existing air-conditioned buildings must be mechanically or mixed mode ventilated and must comply with the minimum requirements of ASHRAE Standard 62-2007.” The finer detail of the chapter goes on to establish strict thresholds for compliance with indoor air quality in new buildings in section 401.06. Maximum acceptable limits are outlined for con-

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international corner taminants such as formaldehyde (<0.08 parts per million [ppm]), total volatile organic compound (TVOC) (<300 micrograms/ m³) and suspended particulates smaller than 10 microns (<130 micrograms/m³). The sampling schedule must also take place preoccupancy, while the duration of sampling must be an hour of continuous monitoring (8 hour time-weighed average [TWA]). Similar levels for existing buildings are set in section 401.06, with additional samples required for respirable dust, ozone, carbon dioxide, carbon monoxide, bacteria and fungi. Section Four’s first chapter also regulates on maintenance of HVAC equipment and ventilation in parking areas, while HVAC professionals should also note chapter two of the section which rules on thermal comfort and the range of conditions which a system should be able to provide for 95 per cent of the year. The “Building Vitality” section’s last chapter addresses water quality, with particular attention paid to the risk posed by legionella bacteria and building water systems. The document requires such fixtures to be periodically maintained, cleaned and disinfected, which has specific relevance to MEP maintenance and FM contractors. However, the importance bestowed on water by the municipality is more thoroughly manifested in section six of the document which looks at resource effectiveness. With detailed rules regarding water efficient fittings, condensate drainage and recovery, irrigation, metering, wastewater usage, and water consumption for heat rejection including heating towers, Dubai Municipality ensures that the emirates most precious resource will be handled with great care. HVAC professionals will undoubtedly take greater interest in section five which covers resource effectiveness – specifically energyefficiency. Chapter One sets out the parameters for air-conditioning design, with the heat load of buildings to be calculated by factoring in the outdoor condition of a building with a dry bulb temperature of 46°C, wetbulb temperature of 29°C, Dubai City location latitude of 25°N, and an extent of variation on the day of design of 13.8°C. Further parameters are outlined for the indoor condition of a building and the sensible and latent heat safety factors applied. Regulations on air loss from entrance and exit and air leakage are also covered. Perhaps the most singularly prescriptive aspect of the entire document can be found in section five’s second chapter which provides exhaustive detail on the minimum energy efficiency requirements of HVAC equipment and systems. The reference table it provides specifies equipment type, size, category, heating section type, subcategory or rating condition, minimum efficiency (T1) levels, maximum efficiency (T3) levels, and test procedure. While it will surely limit the selection of HVAC systems across various applications, its clarity is sure to simplify decision-making and focus efforts on necessary action. Of further interest to HVAC professionals will be the chapter’s stipulations on demand controlled ventilation. Lighting also comes in for rigorous regulation, with maximum average levels set for the watts per square metre (W/m²) across the total interior area of a variety of building types. Retail outlets, shopping malls and workshops must not exceed 14W/m², while manufacturing facilities (13), educational facilities (12), commercial/ public offices, hotels, resorts and restaurants (10), and warehouses

The performance of elevators, as well as escalators, will be regulated in order to limit energy usage when not in use. Water-conserving fixtures must be installed meeting the criteria in the table below Fixture Type

Maximum Flow Rate

Showerhads

8 Litres Per Minute

Hand washbasins

6 Litres Per Minute

Kitchen sinks

7 Litres Per Minute

Dual Flush Toilets

6 Litres Full flush, 3 Liters Part flush

Urinal

1 Litre per flush or waterless

Source: Dubai Municipality Green Building Regulations and Specifications in the Emirate of Dubai

(8) must all use less. Exterior lighting gets similarly tight treatment while lighting controls are to become mandatory to further minimise energy usage. Elevators and escalators are also included in the energy efficiency drive as demands are made for the introduction of reduced speed and use-on-demand controls. The move to more managed consumption of energy is extended to HVAC with a requirement that control systems also be introduced to such installations, as well as to hotel rooms. Chapter two of section five rounds off its comprehensive assault on building systems energy-inefficiency with pronouncements on exhaust air energy recovery systems, pipe and duct insulation, Domestic hot water thermal storage for requirements to be provided by district cooling, ductwork solar water heaters in new villas and labour accommodation. air leakage, and maintenance of mechanical systems. All of this regulation amounts to a seismic shift in the Dubai MEP landscape. Many old habits and practices will have to be scrapped in order to survive in the new world hearlded by the municipal legislation. This will take time and may be costly, but it also presents an opportunity for those quickest to seize the initiative. The ordinance represents a necessary evolution in construction in both a local and global context, but the MEP industry would do well to remember that evolution’s essence has, and always will be, adapt or die.

75%

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Market Column

Big opportunity Regardless of the existing challenges, power continues to remain a sector with high potential D K Aggarwal CMD, SMC Investments and Advisors Ltd

urrently, per capita consumption of electricity in India is 733 KWh and the current installed capacity is 2,00,000 MW. To maintain a GDP growth rate of 5-9 per cent the demand is expected to grow to about two times (1,466 KWh) from the current scenario by 2017. It is expected that with the 12th Five Year Plan(2017), India might have sufficient base load capacity. However, with economic growth, there will still be a need to add 1, 15,000 MW to 1,90,000 MW of base load capacity between 2020 and 2030 i.e, about 12,000 MW to 19,000 MW every year; need to continue adding base load capacity in 13th and 14th Five Year Plan as well. At an average cost of Rs5 crore/MW, India will need Rs60,000 crore to Rs95,000 crore per year. Coal procurement—a key challenge— it is expected that for capacity addition major fuel source will be coal. However, availability of domestic coal is a challenge on account of various bottlenecks such as capacity expansion of Coal India Limited, coal block allocation, tribal land acquisition, environmental and forest clearances. As per the ministry of coal, the projected coal demand in FY 14E is 650 million tonnes (including both coking and non-coking coal), while the likely supply is expected to be 75 MT. This would leave a deficit of about 120 MT which would need to be made up by imported coal or blended coal. Consequently, this will lead to increased demand for imported Broad details of coal based Capacity addition requirement 12th plan capacity of 62,695 MW Type of capacity Thermal Coal Gas Hydro Nuclear Total

capacity (MW) 63,781 62,695 1,086 9,204 2,800 75,785

Technology Type Super Critical Sub-Critical Source of Coal Coal linkage Coal block Imported coal Requiring coal linkage Location Pithead Load centre Coastal

Capacity (MW) 23,940 38,755 38,548 17,825 6,292 30 25,995 25,160 11,540

Sector-wise break-up of 12th Plan capacity (MW) Sector

Hydro

Coal

Lignite Gas

Central State

5,632 1,456

10,600 12,080

826 260

Total Thermal 11,426 12,340

Private

2,116

40,015

Total (MW)

9,204

62,695

1,086

63,781

Nuclear

Total

2,800

19,858 13,796

42,131

2,800

75,785

On the basis of above opportunity and concerns, we prefer companies like Power grid & CESC Ltd from our coverage universe which is completely isolated or partly isolated from the above concerns.

Summary financial -Power grid Net sales INR(mn) Growth Y-o-Y EBITDA INR(mn) PBT INR(mn) PAT INR(mn) EPS (INR)

FY 11 84,147 70,572

FY 12 100,353 19% 83,824

FY 13E 128,452 28% 113,038

FY 14E 155,427 21% 136,776

38,327 27,009 5.8

46,351 32,925 7.1

52,665 39,118 8.4

63,725 47,882 10.33

Summary financial –CESC ltd Net sales Rs (mn) EBITDA INR(mn) PBT INR(mn) PAT INR(mn) EPS INR(mn)

FY 11 49,425 7525 3,516 2,774 22

FY 12 58108 9899 5823 4661 37.1

FY 13E 67,425 12,259 6,441 4,678 37

FY 14E 72,857 1377100% 7,331 5,361 43

coal, resulting in a rise in fuel cost. However, the political will to pass on this increased cost to consumers has been rather weak, thereby forcing to increase subsidy bills. Diversification-need of the hour-currently Indian power sector relies excessively on coal-based generation. India will need to move away from coal to other sources such as Hydro, Solar, Wind and Nuclear as the climate change movement gathers momentum. The estimated fund requirement during 12th Plan for generation, including renewable works out to about Rs6,38,600 crore including Rs2,72,582 crore for advance action for 12th Plan projects.

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market data

Capacity crosses 2 Lkh MW In spite of the problems of fuel linkage of gas and coal, the Indian electricity segment is registering fair growth. For the first time, the country's capacity has crossed 2,20,000 mega watts GROWTH OF INSTALLED CAPACITY SINCE 6th PLAN (in MW) Thermal

Plan / Year

Coal

Gas

Diesel

Nuclear

Total

Hydro (Renewable)

RES (MNRE)

Total

End of 6th Plans(31.03.85)

26310.83

541.50

177.37

27029.70

1095.00

14460.02

0.00

42584.72

End of 7th Plan (31.03.90)

41237.48

2343.00

165.09

43745.57

1565.00

18307.63

18.14

63636.34

End of 2nd Plans(31.03.92)

44791.48

3095.00

167.52

48054.00

1785.00

19194.31

31.88

69065.19

End of 8th Plan (31.03.97)

54154.48

6561.90

293.90

61010.28

2225.00

21658.08

902.01

85795.37

End of 9th Plan (31.03.02)

62130.88

11163.10

1134.83

74428.81

2720.00

26268.76

1628.39

105045.96

March, 2003

63950.88

11633.20

1178.07

76762.15

2720.00

26766.83

1628.39

107877.37

March, 2004

64955.88

11839.82

1172.83

77968.53

2720.00

29506.84

2488.13

112683.50

March, 2005

67790.88

11909.82

1201.75

80902.45

2770.00

30942.24

3811.01

118425.70

March, 2006

68518.88

12689.91

1201.75

82410.54

3360.00

32325.77

6190.86

124287.17

End of 10th Plan (31.03.07)

71121.38

13691.71

1201.75

86014.84

3900.00

34653.77

7760.60

132329.21

March, 2008

76048.88

14656.21

1201.75

91906.84

4120.00

35908.76

11125.41

143061.01

End of 11th Plan (31.03.12)

112022.38

18381.05

1199.75

131603.18

4780.00

38990.40

24503.45

199877.03

End of Mar.â&#x20AC;&#x2122;13

130220.89

20109.85

1199.75

151530.49

4780.00

39491.40

27541.71

223343.60

Captive Generation Capacity in Industries having demand of 1 MW and above, grid interactive (as on 31-03-11) = 34444.12 MW Note: Installed Capacity of RES is 27541.71 as on 31-03-2013

Total energy mix

While coal-based and gas-based power plants registered minimal growth in the past year, nuclear and hydro remained at the same levels. It is expected that clarity on fuel and tariff issues will bring back the growth on track this year. Thanks to the ministry of new and renewable energy, the segment has registered a better growth rate in the last year than the conventional segment.

27541.71

2,23,343.60 MW (as on 31-03-13 ) Coal-based generation continues to dominate the capacity addition in the country. The other notable difference witnessed in the generation capacity addition is the increase of private players in the sector.

Generation

130220.89

39491.40

TOTAL 211766 Coal Gas

4780.00 1199.75

Diesel Nuclear

20109.85

Hydro RES

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market data

Coal supply position List of TPP having critical stock less than 7 days as on 31-03-2013 The less stock of coal as a fuel in the thermal plants continue to be a concern for both the power companies and the country. The fuel supply mandate says that the plants should have 22 days fuel in stock. However, the below chart reflects the dipleted fuel condition of the thermal plants in the country. No

Name

No of days

reason

Badarpur

Due to less receipt of coal from CCL i.e. 92% of ACQ during Apr 12- Mar 13

Mahatma Gandhi

Inadequate coal availability of domestic coal

Anpara 'C'

Due to financial constraint.

Dadri

Due to higher generation i.e. 108% of Prog during April12 -Mar13

Sabarmati C

Due to less reciept of coal during Apr 12- Mar 13 i.e. 94% of ACQ

Korba STPS

Due to higher generation i.e. 114% of PLF during Apr12 -Mar13

Sipat

Coal supply for Sipat Unit 2&3 yet to commence by SECL

Khaperkheda

Due to less reciept of coal from MCL during Apr 12- Mar 13 i.e. 64% of ACQ

Bhusawal

Parli TPS

Due to raw water constraint coal supply was regulated by power station

Wardha Warora

Due to inadequate import

Simhadri

Due to less reciept of coal during Apr12-Mar13 i.e. 87% of ACQ/MOU

Rayalseema

Due to higher generation i.e. 84% of Prog during Apr12 -Mar13

North Chennai

Due to less reciept of coal from CIL during Apr12- Mar13 i.e. 92% of ACQ

Vallur TPP

Due to less reciept of coal during Apr12- Mar13 i.e. 73% of ACQ/MOU

Kahalgaon

Due to inadequate coal availability in linked mine of ECL(Rajmahal)

Durgapur Steel

Coal supply for unit 2 yet to commence by CIL

Talchar STPS

Due to less import

Sterlite

Due to less reciept from MCL

Santaldih

Due to less import of coal during March 2013

Due to less reciept of coal during Apr12-Mar13 i.e. 46% of ACQ

Note: i) Muzaffarpur TPS is under long outrage for R&M activities ii) Kodarma TPS Generation yet to start / coal supply still awaited LOA Letter of Award ACQ Annual Contracted Quantity

Installed generation capacity (as on 30-04-13 ) All India

Thermal Coal

Nuclear Gas

Diesel

Total

Hydro Renewable

Renewables

Grand total

MNRE

130370.89

20109.85

1199.75

151680.49

4780.00

39623.40

27541.71

223625.60

% average

58.3

9.0

0.5

67.8

2.1

17.7

12.3

100.0

June 2013 | Electricals Today

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10 things about...

Bulk power transmission With the higher capacity generation plants coming onstream, the distribution utilities are looking at bulk transmission

16 27 38 49 510

Transmitting electricity from the point of generation to point of distribution i.e, substations, are known as bulk power transmission

Normally, bulk power transfer is being done through overhead transmission wires

High â&#x20AC;&#x201C;voltage lines with capacity

High-voltage direct current (HVDC) lines are also put into use now to transmit power for longer distance. This brings losses to a minimal level

110 kV

of and above are commonly chosen for the transmission of power in bulk

Earlier, transmission and distribution were under one state-owned company. But now, they are two different companies

Bulk transmissions also happen through underground power cables and submarine lines

Majority of the countries use highvoltage three-phase alternating current (AC) lines for power bulk transmission

If HVDC is used for 100 mile, 765 kV line carrying 1,000 MW of energy, then the losses will be as low as

The interconnected transmission lines are part of the bulk transmission network, forming the transmission grid

1.1%

A transmission network consists of power lines, cables, circuit breakers, switches and transformers

Electricals Today | june 2013

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