Power Sector Reform_in India

• The Expert Committee submitted the report in August’06. • India needs to sustain 8-10% growth rate over the next 25 years for eradicating poverty and meeting its human development goals. •

This would require, at least, enhancing primary energy supply by 3-4 times and the electricity supply by 5 times ,of 2003-04 level.

Integrated Energy Policy

• Power generation capacity would need be in the order of 8,00,000 MW in year 2031-32 from the current installed capacity of about 1,39,000 MW. •

Main objectives have to be energy security, reliability, competitive prices and meeting lifeline energy needs in a technically efficient, economically viable and environmentally sustainable manner.

Integrated Energy Policy

• National Electricity Policy (NEP)- notified in year 2005. • Competitive Bidding Guidelines – notified in year 2005. • Tariff Policy – notified in year 2006. • Rural Electrification (RE) Policy – notified in year 2006. Electricity Act 2003

• Regulations for inter state transmission issued by CERC -2004. • Open access to consumers above 1 MW within 5 years (by January, 2009). • Regulation for open access in distribution issued by 23 SERCs. • 26 licenses awarded by CERC for inter state power trading. Electricity Act 2003

• Present trading volume ~ 2.5% of total power generated. • Theft of electricity made a cognizable & non- bail able offence. • Commercial losses of state power utilities on the decline.

Electricity Act 2003

• Generating Capacity to be increased from 105,000 MW to 212,000 MW • Share of the Private Sector to be increased from 10% to 16.5% • Hydel Generation to be increased from 25% to 30%.

• Inter-regional transfer capability to be increased from 4850 MW to 30,000 MW.

Vision 2012 ( G O I ) “ Power for All by 2012 ”

• Recovery of the power cost through the realized tariff

from 70% to 100%. • T. & D. Losses to be reduced from 40% to 13%. • 100% rural electrification from the existing 86%. • Peak Energy Shortage to be brought down to 0 from the existing 13%.

• Average Energy Shortage to be brought down to 0 from the existing 8%.

Vision 2012 ( G O I ) “ Power for All by 2012 ”

• Major national effort to universalize access to electricity – 57% of rural households were without access in 2001. •

Launched in 2005. Targets : • 1,00,000 un-electrified villages. • 78 million rural households in un-electrified and electrified villages.

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Provides 90% capital subsidy. 100% capital subsidy for electrification of Below-Poverty-Line (BPL) rural households. Rural Electrification : Rajiv Gandhi Gramin Vidyutikaran Yojana (RGGVY)

• 44,000 villages electrified. Another 22,000 villages covered under intensive electrification. About 2 million connections given. • USD 1.5 billion invested. Another USD 6.75 billion provided. •

National programme for Franchisee development launched.

Rural Electrification : Rajiv Gandhi Gramin Vidyutikaran Yojana (RGGVY)

• Franchisees in place in 14 states, covering 63,000 + villages. •

Generated employment for villagers and improved consumer services.

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Resulted in significant improvement in revenue collection.

• Some examples: • Dibrugarh 89% • Bulandshahar 100% • Bijapur 103% Rural Electrification : Rajiv Gandhi Gramin Vidyutikaran Yojana (RGGVY)

• The Central Electricity Regulatory Commission established and functional • 9 States have passed reform law. • 9 States have unbundled State Electricity Boards. • 21 States have constituted State Electricity Regulatory Commissions. • 12 State Electricity Regulatory Commissions have issued tariff orders.

Reforms - So Far

• Flagship programme of the Central Government to support States in strengthening distribution networks and improving operational efficiency. • 571 projects totaling USD 4.3 billion sanctioned. • 9 states demonstrated reduction in cash losses of USD 1.4 billion in last five years. USD 490 million released cash incentive. Accelerated Power Development and Reforms Programme (APDRP)

• 100% feeder metering completed in 23 states. 90%+ feeder metering in another 3 states. • 100% consumer metering in 3 states. 90%+ consumer metering in another 12 states. • Aggregate Technical & Commercial (AT&C) losses brought down to below 20% in 212 APDRP towns. Below 15% AT&C losses in 169 towns. National average is about 34%. Accelerated Power Development and Reforms Programme (APDRP)

• Reduction of T. & D. losses to around 13%. • Up-gradation of sub-transmission and distribution system. • 100% metering (AMR – Automated Meter Reading) • Renovation and modernization of power plants. • Improving the quality and reliability of power supply

Restructuring of APDRP

• TOD – Time of the concept introduction. • Bifurcate agricultural pumping load from the non-pumping load in all rural feeders. • Investment Assistance  25% grant, 25% loan from GOI.  Balance 50% IG / FIs • Incentive Scheme  Reward for actual cash loss reduction • Fund release based on achievement of milestones

Restructuring of APDRP

• Hydro share to be raised from 24% to 27% in next five years.

• Expansion of existing stations. • Coal Pit head stations.

• Coastal stations. • Generation de-licensing. • Captive capacity utilization. • Joint Ventures of Central Undertakings with States

Sectoral Opportunities – Generation

• National Grid  4950 MW to 30,000 MW of interregional transfer capability by year 2012 . • Technology up-gradation – 800 KV A.C. and 500 KV D.C.

• RLDCs modernization. • Reliability improvement, reactive compensation.

• Private participation via  Independent Power Transmission Co.  Joint Venture with Power Grid

Sectoral Opportunities – Transmission

• Refurbishment of sub-transmission and distribution networks.

• Energy accounting and MIS • Metering and meter reading systems.

• Less High Voltage Distribution Systems • Technology enhancement for improved reliability • SCADA, Advanced Communications, Mobile Facilities and GIS. • Web enabled facilities for consumers.

Sectoral Opportunities – Distribution

Electricity – Lighting up INDIA