Electrical

The Format for the Proposal of MRP – I

1.

The Title page

2. A brief introduction to selected industry 3. Statement of the Problem 4. Scope of the study 5. Objectives of the Study 6. Significance of the Study 7. Research Methodology 8. Chapterisation scheme 9. Time planning 10.Budget 11.Bibliography (Source/s of data)

A MANAGMENT RESEARCH REPORT Of “COMPREHENSIVE STUDY ON INDIAN ELECTRIC POWER INDUSTRY”

SUMMITED TO, V.M.PATEL INSTITUTE OF MANAGEMENT

Ganpat University, Kherva. SUMMITED BY, Gurjar Sanjiv B. Chondagar Ghanshyam R. Mohmmad Tarik K.

Introduction of Indian Electric Power Industry The electric power industry in India is both a supplier and a consumer of primary energy, depending on the kind of energy used to turn the generators. Hydroelectric and nuclear power plants add to the country's supply of primary energy. The total installed electricity capacity in public utilities in 1992 was 69,100 megawatts, of which 70 percent was thermal, 27 percent hydropower, and 3 percent nuclear. The total installed capacity was programmed to reach around 100,000 megawatts by FY 1996 through a package of government-supported incentives to the private sector. Because they cannot always depend on public utilities, many larger industrial enterprises have developed their own power generation systems. In 1992 there was a capacity of 9,000 megawatts outside the public utility system. Overall, the generation and transmission of power in India--with an average 57 percent plant load factor in FY 1992 in thermal plants and transmission losses of 22 percent--were inefficient. About 322 billion kilowatthours of power were generated by utilities in FY 1992, approximately 8.5 percent shy of demand. The resulting deficit led to acute shortages in some states. This trend continued the next year when 315 billion kilowatt-hours were produced. Many factors contributed to the shortfall of electric power in India, including slow completion of new installations, low use of installed capacity because of insufficient maintenance and coal, and poor management. In FY 1990, industry accounted for 45 percent of electricity consumed, agriculture 26 percent, and domestic use 16.5 percent. Other sectors, including commerce and railroads, accounted for the remaining 12.5 percent.

Rural electrification in India made great progress in the 1980s; more than 200,000 villages received electricity for the first time. In 1990 around 84 percent of India's villages had access to electricity. Most of the villages without electricity were in Bihar, Orissa, Rajasthan, Uttar Pradesh, and West Bengal. Villagers complain that government figures on electrification of villages are artificially inflated. Actually, although lines have been run to most villages, electricity is provided only sporadically (for example, only nine to twelve hours per day), and villagers feel they cannot depend on electricity to operate pumps and other equipment. Electricity to cities also is sporadic; blackouts occur every day in most cities. India's first hydroelectric station was constructed in 1897 in Darjeeling (then Darjeeling). In FY 1990, installed capacity for hydroelectric power was 18,000 megawatts. The country has a large economically exploitable hydroelectric potential, especially in the foothills of the Himalayas, but no large increase in capacity is predicted for the mid-1990s. Hydroelectric facilities have to be coordinated with other sources of electricity because seasonal and annual variations in rainfall affect the amount of water needed to turn the generators and consequently the amount of electricity that can be produced. Hydroelectric power projects in India have not been without controversy. Indian Dams for irrigation and power generation have displaced people and raised the specter of ecological problems.

Power Generation Electricity generation is the first process in the delivery of electricity to consumers. The other processes are electric power transmission and electricity distribution which are normally carried out by the electrical power industry. The growth of the industrial economy of India depends on the rapid development of the badly lagging power generation sector. Though India has abundant natural resources for generation of both hydro and thermal power, infrastructural shortcomings may bring the power industry to its knees By the end of 1995, India's total installed power generation capacity was 81,164 Megawatt. Of that, hydro-electricity (hydel) accounts for almost 26 percent, but hydel accounts for less than 13 percent of the total electricity generated in the first three years of the current eighth plan. In the thermal power segment, the average plant load factor (PLF) has improved in recent years, especially in the south and west of the country. Thermal power generation appears to be the most promising way for India to meet it's power requirements over the next years. The previous government as well as the new United Front government have several projects on hand to best serve this requirement. Among the projects on the anvil is a plan to privatize the fuel supply system. In most proposed power projects, fuel leakage and fuel risk responsibility have been among the main stumbling blocks. The state as the fuel supplier is unwilling to sign any guarantees and the private power companies are unwilling to risk running out of the fuel.

Another related area where this argument is extended is the transport sector. The previous ministry of transportation was in the view that the legally enforceable commercial agreement with transporters of fuel like the railways should be made into a mandatory clause. Once the basic transport and resource utilization (mining, petroleum refining) infrastructure starts developing apace with the needs of the power generation industry, the thermal power units will start to be functionally efficient, and the needs of Indian industry will be better met.

Distribution Segment: Indian Power Distribution is characterized by extremely high technical and non-technical losses, resulting from obsolete and inefficient distribution equipment, widespread power theft, illegal connections and non-payment of bills. The direct financial cost of preventable losses exceeds Rs. 25,000 Crores annually, and, without remediation, is expected to double in five years. Current losses are comparable with the annual investment requirements for the power sector, are twice India's annual budget for health, and about half its annual budget for education. Accelerated Power Development and Reforms Program (APDRP) In power sector, the distribution system plays a vital role where, the gap between the average revenue realization and the average cost of supply has been constantly increasing since a decade. This is causing the state electricity boards (SEB) run under huge losses. In view of the losses faced by the SEB's, the Government of India/MOP has undertaken the APDRP with the aim of restoring the commercial viability in the distribution sector. The main aim of the program is

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To make the power sector financially viable To provide reliable, quality power supply at affordable cost to consumers. Reduction in Transmission and Distribution losses (T&D) to around 10%. Introduce IT initiatives in Power Distribution reducing human intervention. Computerization for Management integrated system (MIS) Computerization for billing, etc. Customer satisfaction

Schemes planned under APDRP are renovation and modernization of sub-stations, transmission lines & distribution transformers, augmentation of feeders & transformers, feeder and consumer meters, high voltage distribution system (HVDS), consumer indexing, SCADA, computerized billing etc.

Power Companies in India Many government as well as private organizations have taken up the task of power generation in India. The major Indian power companies playing prime are:       

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Bhakra Beas Management Board Enercon Systems India Essar Group GMR Group Gujarat State Petroleum Corporation Ltd Jindal Steel & Power Limited Karnataka Power Transmission Corporation Limited (KPTCL) Karnataka Renewable Energy Development Limited Konarka Magnum Power Generation Limited Nippo Batteries Reliance Energy Ltd. Shri Shakti

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Durgapur Projects Limited Satluj Jal Vidyut Nigam Ltd. United Power Ventral Systems Pvt. Ltd. Enron India Power Plant Celetronix Power India Caterpillar Power India Alton Power India Thorium Power India GE Power Controls India Green Power India

Indian Power Industry Profile

GROWTH OF INDIAN POWER SECTOR: Generating capacity has grown manifold from 1712 MW in 1950 to 110000 MW today. Transmission lines have grown from 2708 ckm to 200000 ckm. STRENGTHS OF INDIAN POWER SECTOR: Well established and rapidly growing transmission and distribution network, private investment possible in all the segments, highly qualified and trained Engineering, IT and Finance professionals and Independent Judiciary with well established legal system. COMMERCIAL LOSSES IN STATE UTITLITIES: Commercial losses have increased from Rs. 4,200 Crores in 1992 to about Rs. 27,500 Crores in 2003. Among the factors responsible, the majors are Unmetered Supply, No Comprehensive Energy Auditing / Accounting, Theft and Pilferage, Cross subsidy in favor of Agriculture and domestic sectors. REFORMS - OBJECTIVES: To bring in commercial viability in Power supply industry; to provide reliable power supply at affordable costs to all the consumers; Complete Rural Electrification power to all including remotest areas; use of Information Technology to reduce human intervention wherever possible; competition in all fields of power sector viz., Generation, Transmission and Distribution. STRATEGY FOR REFORMS:

Constitution of Central and State Electricity Regulatory Commissions, Full Audit of Energy Flow, 100 % Metering, Eradication of theft, Rationalization of tariffs, Corporatization of Distributions. REFORMS THRUST - DISTRIBUTION: Reduction of T&D losses, rationalization of Tariffs; Improvement of efficiency in Metering, Billing and collections to help generate internal resources. Proper Demand Side Management to reduce the requirement of capacity additions. Accelerated Power Development and Reforms Program: APDRP is aimed at the objectives discussed above. The total allocated budget under this scheme was Rs. 40,000 crores including the Reforms component and the component for writing off the losses in the previous regime. The total funds utilized as on 1st January 2005 were Rs. 9,000 crores approximately. Several states have not picked up the essentials of this program and the funds are lying unutilized.

Statement of the Problem

We have the statement of the problem is finding the data about the electric power industry of whole India regarding to Power generation & distribution. Therefore, we will collect the data about this & analysis of them too which gives findings & suggestion to the industry. Also, we compare this data with other country through which we become able to understand the global growth with respect to the other country. Objective of the Study •

The report provides research and objective analysis of Indian Power Industry.

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This report helps clients to analyze the opportunities critical to the success of power sector in India. Government support, economic growth, market reforms etc remain the major market forces for the Indian power industry.

• With this data we become able to understand whole Indian Electric Power Industry & also its generation & distribution strategies with respect to other country. Scope of the Study • Indian power sector is plagued by high T&D losses, which is one of the main issues for the deteriorating state of SEBs. • This sector has been through number of reforms in the past 10 years, which have not been very successful. In fact, there have been disasters such as Enron and Orrisa’s attempt at reforms. Hence, it will be interesting to observe the impact of

the current reform initiatives namely, the APDRP, The Electricity Act, 2003. • The generating capacity has grown manifolds from 1,362MW in 1947 to more than 112,058MW. However, India still has a huge demand supply gap. •

The impact on reforms in light of the change in the political scenario.

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High Transmission and Distribution Losses, Small Capital Outlay by Indian Distribution Equipment Players & Regulatory Complications are major obstacles before Indian power sector. This will become the scope of our study. In our research report we will include it & also compare them with other country for global sustenance.

Significance of The Study With the help of the study, we become able to know following elements: Market forces driving the industry & challenges faced by it. • Major players in Indian Electric Power Industry. • What opportunities exist in Indian power industry? • Detailed overview of Indian power sector at state level. •

Research Methodology The data presented in this report are derived from a comprehensive study of the Indian domestic or external power distribution market. The primary and secondary research included all possible major application areas for both external & domestic power supplies. The data-gathering methodology included Secondary research was performed using all available published sources including, but not limited to, nonproprietary, previously performed and related work by the other Group, all available trade journals, proceedings from related trade conferences, previous industry studies, annual reports, 10Ks, advertising, product literature, and soon. Chapterisation Scheme In it, we include the brief structure of our research study covering the overall aspects. Chep. - 1 Introduction - Intro. About the Project - Intro. About the Indian Electric Power Industry. Chep. - 2 Indian Electric Power Industry Profile Chep. - 3 Major players in Industry Chep. - 4 Statement of the Problem Chep. - 5 Objectives & Scopes of the Study Chep. - 6 Significance of the Study

Chep. - 7 Research Methodologies Chep. - 8 Swot Analysis - Strength & weakness (Comparison of two Country) - OT Analysis ( Within one Industry) Chep. - 9 PEST Analysis (Political, Economic, Social,& Technological) Chep. -10 Strategic Analysis (Last years) Chep. - 11 Financial Analysis (Growth, Sales, & Exports) Chep. - 12 Major players in Industry (Top of the Industry) Chep. - 13 Conclusion Chep. - 14 Suggestions Chep. - 14 Bibliography