What are the main challenges India faces in its power sector regarding electricity access and supply?

The importance of electricity as a prime driver of growth is very well acknowledged and in order to boost the development of power system, the Indian government has participated in a big way through creation of various corporations such as, State Electricity Boards (SEB), NTPC Limited, NHPC Limited and Power Grid Corporation Limited (PGCL), etc. However, even after this the country is facing power shortage.
There are many problems faced by the power sector and these need to be addressed. One of the issues plaguing the power sector in a big way is shortage of equipment. This has been a significant reason for India missing its capacity addition targets. While the shortage has been primarily in the core components of Boilers, Turbines and Generators, there has been lack of adequate supply of Balance of Plant (BOP) equipment as well. There is a shortage of construction equipment also.
The current power infrastructure in India is not capable of providing sufficient and reliable power supply. Some 400 million people have zero access to electricity since the grid does not reach their areas.
Another problem is unstable power supply. There are frequency fluctuations caused by load generation imbalances in the system and this keeps happening because consumer load keeps changing. Frequency is the most crucial parameter in the operation of AC systems. The rated frequency in India is 50.0 Hz. While the frequency should ideally be close to the rated frequency all the time, it has been a serious problem in India. Poor power quality control has knock-on effects on equipment operation, including large-scale generation capacity. Equipment damage can, of course, further compromise supply and aggravate the effects of chronic fuel shortages.
To summarize, Indian power sector has made considerable progress in the last decade and has evolved from a nascent market to a developing market led by policy reforms and increased private sector participation. Challenges do exist in the sector, which India has to overcome to evolve from a developing market to a matured market. Meanwhile, the gap between what can be achieved and what is currently present, uncovers a number of possibilities and opportunities for growth.
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Toshiba has been an integral part of India's power sector for decades.

India's looming power crisis: An analysis
There are many roadblocks in unleashing the full potential of India's power sector
There are many roadblocks in unleashing the full potential of India's power sector
Electricity is critical to fuel the economic growth of India. The country is on the fast trajectory of development but to keep the momentum of growth high, availability of uninterrupted power supply is a must. India needs electricity to fuel the growth of every industry, be it large-scale or smallscale, manufacturing, healthcare or education.
There are many roadblocks in unleashing the full potential of India's power sector. One is fuel availability concerns faced by the industry. Coal supply by Coal India Ltd (CIL) is restricted to around 65% of actual coal requirement by coal-based thermal plants, leading to increased dependence on imported coal. This results in increasing power generation costs due to limited fuel availability. Increasing operational inefficiencies and outstanding debts have led to poor financial health of state discoms. Then there are other concerns such as land acquisition which has made purchase of land for power projects very expensive. Installation of power plants in any case, requires huge investments and the land acquisition cost pushes the capex to unprofitable and unsustainable levels.
India has been dependent to a large extent on energy imports to meet its national energy requirements. As per the estimates of Planning Commission, Government of India (GoI), to ensure a sustained 8% growth of the economy, by 203132 India needs to increase its primary energy supply by three to four times and its electricity generation by five to six times of the 2003-04 levels. To limit the dependency on energy imports and contribute in meeting this energy challenge, the government is also laying a lot of emphasis on energy efficiency and demand side management. Efforts are being made to increase supply from renewable sources of energy and promote energy conservation in various consumption sectors through appropriate policy interventions.
Energy-efficiency is extremely important and can be promoted by setting appropriate prices and this is particularly important where energy prices are rising. However, appropriate prices by themselves may not suffice and non-price incentives/disincentives are therefore also required. This includes standards of energy efficiency that are forward looking, i.e., anticipate future price changes or pollution penalties. These standards should be determined on the basis of rational considerations and must be set in an expanding range of applications, with continuous dynamic adjustment of these standards. The standards should also be effectively enforced.

While the power sector in India has witnessed a few success stories in the last 4-5 years, the road that lies ahead of us is dotted with innumerable challenges that result from the gaps that exist between what’s planned versus whatthe power sector has been able to deliver. This document highlights and quantifies some of these gaps and attempts to analyze the problem. The document builds on the risks prevalent in the industry, some prominent hurdles that the power sector has already crossed, and more importantly - others that various players have to overcome. Understanding these core issues & risks of the power sector help in identifying the opportunities that lie ahead; for example why is private sector participation an important requirement. A short peek at our past performances indicate that during the last three five year plans (8th, 9th and 10th), we have barely managed to achieve half of the capacity addition that was planned. As we enter the third year of the 11th five year plan, we have already seen slippages on the planned approx. 79 GW capacity addition.
Once we break the problem down and identify the bottlenecks, we may be able to better understand the integration challenges that such large projects pose. While there may be heavy dependencies on equipment suppliers and challenges around logistics and work-front availability – with the right and timely application of project management principles along the lifecycle of the project, one can strive to achieve increased project completion against baselines. Certain best practices around stakeholder management, integrated project and asset development and interdependency mapping across various entities can help improve overall project planning. Once we understand the practical implementation challenges, various teams and people get aligned to the overall strategy, then the delivery on our estimated plans becomes more of a reality.
India has the fifth largest generation capacity in the world with an installed capacity of 152 GW as on 30 September 20091, which is about 4 percent of global power generation. The top four countries, viz., US, Japan, China and Russia together consume about 49 percent of the total power generated globally. The average per capita consumption of electricity in India is estimated to be 704 kWh during 2008-09. However, this is fairly low when compared to that of some of the developed and emerging nations such US (~15,000 kWh) and China (~1,800 kWh). The world average stands at 2,300 kWh2.

India recently experienced one of the world’s worst blackouts, with 670 million citizens directly impacted. While media reports have focused on the repercussions from two days of outages, this incident illustrates a much larger, more systemic problem: the need for improved electricity governance.
India’s History of Power Problems
India has the world’s fifth-largest electrical system, with an installed electric capacity of about 206 gigawatts (GW). India initiated power sector reforms in the early 1990s through a range of legal, policy, and regulatory changes. Over the last two decades, some of these reforms have been impressive, but several others weren’t taken. This lack of follow-through has resulted in a growing gap between electricity demand and supply throughout the country. Recent blackouts may have shined a spotlight on this gap, but it’s a situation that’s widespread in India: Not only do 400 million Indians lack access to electricity, but electricity supply is unreliable and of poor quality even in large parts of “electrified” India. In addition to the existing demand, Indian consumers, businesses, and industries seek more electricity to power appliances, processes, and products, further exacerbating the demand-supply gap. By 2035, India’s power demand is expected to more than double.
3 Holes in India’s Electricity Governance
Loss and Theft: The predominant solution proffered by policymakers in India is to increase generation capacity—unmindful of the substantial technical losses due to outdated power lines, leaky cables, and poor maintenance; commercial losses due to poor metering and local politicians’ populist “free power” policies ; and rampant electricity theft caused by people hooking up wires to overhead electricity cables. Building more power plants without fixing these problems is akin to pouring water into a bucket with large holes. With India’s power plants close to 70 percent dependent on coal and natural gas, the current coal shortages and non-availability of gas haven’t helped the situation. The Planning Commission’s Working Group on Power for the 12th Plan, among other studies, have pointed to these “holes,” but so far there’s been no serious effort made to address electricity losses or theft. No doubt, there are vested interests that benefit by the business-as-usual scenario. But there is an urgent need to hold decision-makers accountable for solving these issues on a priority and not allow them to obfuscate the situation by announcing another round of new power plants.

The first step towards this goal is demanding accurate estimates of electricity losses, as well as public disclosure of efforts being taken to address them.
A Lack of Accountability: India’s transmission network needs strengthening in order to efficiently deliver the generated electricity from power plants located in different parts of the country to millions of consumers. Each state in India has its own transmission agency, and these are networked into one of five regional grids. Over the last decade, India has embarked on a project to join the five regional grids and establish a national grid. The plan sounds good in theory, but it requires a high level of discipline in order to work. Each state government needs to coordinate with the others to ensure no one is drawing too much power or impacting another’s allocated electricity. The blame game that followed the recent blackout showcases the fact that this communication and coordination just isn’t happening yet. Also, there is really no one accountable for managing the grid, pointing to a serious accountability vacuum.
Lack of a Holistic Governance Approach: India does not have a holistic approach to electricity planning or implementation. Generation, transmission, and distribution planning (and investments in each of them) happen independent of each other; renewable energy planning takes place outside of conventional electricity planning; and service to on-grid consumers and off-grid consumers happen separately–all of which highlights the absence of an over-arching electricity governance framework. This situation has caused ad hoc and lopsided planning, with no public disclosure of information about efforts to close the electricity demand-supply gap. Plus, no one agency or institution anywhere in the country is accountable for the failure to provide affordable, reliable, and quality electricity.
Improving India’s Electricity Governance
This list certainly isn’t exhaustive—several other interlinked problems contribute to the malaise affecting India’s power sector, from bad monsoons and water scarcity to inefficient electrical appliances. There are solutions to some of these concerns through improved technology (such as isolating and responding to grid problems and enhancing power plants’ efficiency) and innovative policies (like holistic planning approaches and incentivizing grid discipline), but addressing the accountability and governance issues are key to improving India’s power sector.
WRI’s Electricity Governance Initiative (EGI) is a network of civil society organizations working to promote transparent, inclusive, and accountable decision-making in the electricity sector in several countries, including India. EGI’s 2006 assessment of India’s power sector identified a range of core electricity governance problems in India.

The Indian government has set ambitious goals in the 11th plan for power sector owing to which the powr sector is poised for significant expansion. In order to provide availability of over 1000 units of per capita electricity by year 2012, it has been estimated that need-based capacity addition of more than 100,000 MW would be required. This has resulted in massive addition plans being proposed in the sub-sectors of Generation Transmission and Distribution.
While some progress has been made at reducing the
Transmission and Distribution (T&D) losses, these still
remain substantially higher than the global benchmarks, at
approximately 33 percent. In order to address some of the
issues in this segment, reforms have been undertaken
through unbundling the State Electricity Boards into
separate Generation, Transmission and Distribution units
and privatization of power distribution has been initiated
either through the outright privatization or the franchisee
route; results of these initiatives have been somewhat
mixed. While there has been a slo and gradual
improvement in metering, billing and collection efficiency,
the current loss levels still pose a significant challenge for
distribution companies going forward.
While additional gas supply from KG Basin has eased shortage to a limited extend, supply constraints for domestic coal remain and are expected to continue going forward. Consequently, public and private sector entities have embarked upon imported coal as a means to bridge the deficit. This has led to some Indian entities to take upon the task of purchasing, developing and operating coal mines in international geographies. While this is expected to secure coal supplies it has again thrown upon further challenges. For example, the main international market for coal supply to India – Indonesia, poses significant political and legal risks in the form of changing regulatory framework towards foreign companies. Similarly, coal evacuation from mines in South Africa is constrained by their limited railway capacity and the capacity at ports is controlled by a group of existing users making it difficult for a new entrant to ensure reliable evacuation9. In this case it is essential to manage the risk of supply disruption by different options like – diversification of supply, due diligence on suppliers, unambiguous contracting and strict monitoring among others.
Source : ©2010 KPMG, an Indian Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity, http://www.kpmg.de/docs/PowerSector_2010.pdf

At the consumption end, the greatest achievement has been the extension of electricity services to all parts of the country through a programmatic approach that effectively addressed a seemingly intractable issue. The country has also witnessed the emergence of a very strong and competent national regulator in the form of the Central Electricity Regulatory Commission (CERC). Despite the many challenges it inevitably faced, the CERC has emerged as a strong institution that has implemented the core constructs of the Electricity Act, 2003 with elan and has evolved a common market design that is universally accepted, including by the states. Such wide and large-scale transformation in a country of continental proportions, despite all the deep-seated challenges, is absolutely unprecedented.
The greatest unaddressed challenges in the Indian electricity sector lie in the states where institutions are weak and decisions are often influenced by political priorities and considerations. Two genres of state-level institutions stand on weak legs: distribution and supply licensees, and the state electricity regulatory commissions that regulate the state-level licensees. In a legal construct that is predicated on non-discriminatory open access, distribution and supply licensees are deeply conflicted in carrying out both functions while simultaneously permitting open access to third parties. It is time that these conflicts are removed and the two functions are unbundled and accorded two distinct licences. The distribution licensee, in its new avatar, can collect fair and reasonable access charges from all users, including the supply licensee(s) and other open access users, invest wisely in upgrading networks and earn reasonable profits. Arguably, the incumbent supply licensees will also be well positioned to compete with their access to a low-cost historical portfolio of contracts. At a time when building new power plants (especially conventional ones) has become very challenging, the incumbents will have great competitive advantages. The integrated distribution and supply licences arguably hinder their own performance and commercial interests. It is indeed a pity that the incumbents typically do not perceive this to be the case.
Independent regulation at the state level has mirrored the misplaced priorities of the state-level regulated entities. Since their inception, they have largely focused on keeping tariffs down, ignoring or downplaying the mandate of the Electricity Act, 2003 consumer service standards, ushering efficiencies in sector operations and regulating the overall sector in a fair and transparent manner.

In addition, the National Electricity Plan (NEP) created by the CEA in April, 2007, emphasized private sector participation by the provision of a fixed return on investment based on an assessment of opportunities and risk.
Challenges with the India Model
The India government, as explained earlier, has been conservative in allowing partial privatization of the power sector, perhaps for the sole reason of preventing private companies from using the electricity sector for private maximization. There is therefore need for professional and competent operations of the state utilities with functional autonomy and without bureaucratic bottleneck in the electricity reform. The Electricity Act, 2003, although provided a time frame for unbundling the State Electricity Board of each State, many states have deferred their restructuring innumerable time. In some states like the Jammu & Kashmir, Puducherry, Goa, Sikkim, Arunachal Pradesh, Manipur, Mizoram and Nagaland, the power sector is functional through a government department and in some other states; the distribution of electricity continues to be public sector driven except for Delhi and Orissa.
The contribution of the private sector has therefore remained quite low, despite the passage of the Electricity Act in 2003 that divested the sector. For instance, in March 2008, the total generating capacity of private participation constituted only 14%. The private sector contributed 20,011 MW out of a total capacity of 143,061 MW. When compared against the energy generation in March 2008, it would be correct to say that the private sector contributed 5,424 MU out of the total energy generation of 61,206 MU, which merely represents about 10%.
Furthermore, some key implementing challenges militating against private participation in the electricity sector include ensuring availability of fuel quantities and qualities, lack of initiative to develop large coal and natural gas resources present in India, land acquisition, environmental clearances at state and central government level, fuel supply, financial closure, power equipment supply, project execution and training of skilled manpower to prevent talent shortages for operating latest technology plants. Thus, despite the multiple licensing provided under the Electricity Act, 2003, Investors perceive a high risk in the distribution sphere due to inefficiency and exposure to regulatory risks, especially taking into cognizance that distribution is under state jurisdiction.

A number of policy measures at national level, which could be applied concurrently, would significantly improve the framework for renewable energy in India.
After all, India's rapid and enduring economic growth is intrinsically linked to the increasing consumption of energy and natural resources.
INTERVIEW YOSHIAKI INAYAMA
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Yoshiaki Inayama , Managing Director, Toshiba JSW Power Systems Pvt. Ltd. (TJPS) speaks to Dipti Srivastava about the challenges of power sector in India and Toshiba's commitment in solving the problems through innovative technologies
In the past few years, in spite of various initiatives, power situation still remains one of the core challenges for India. What are the factors responsible for it?
Electricity is one of the basic constituents for the economic growth of a country and as you said there are various initiatives taken in the country in the past few years to improve the power situation. Toshiba's major expansion of power business in India is also a result of this. One of the biggest concerns is the gap in the demand and supply of power in India. There are several barriers that pose a challenge to the Indian power sector. The first challenge is land acquisition; not only for the power sector but for any industry. The second challenge is speedy environmental clearance.
The third challenge is availability of coal. Half of the Indian power generation depends on coal as a source and the production of coal has not increased to match the demand. And the fourth challenge is financial crisis. Because of the recent economic slowdown, financing for new projects have become tougher, especially for Independent Power Producers (IPPs). There was no order from IPPs in the last fiscal year.
After the last general elections in India, there is a huge expectation, both from the general public and the industry that things will improve. At present Power, Coal and New & Renewable Energy ministries are functioning under a single leadership. It means more focused and better co-ordination among these ministries and ultimately improvement in the power situation is expected.
In your opinion, how does it impact the economic growth of the nation?
The Indian economy is in the trajectory of upward growth. To keep up the momentum of this growth, availability of uninterrupted power supply is a must.

It is often said that sectoral reforms have a very non-linear path. Electricity in India is a good example. The central challenges identified were inadequate generation capacity, high distribution losses, and free (and, in case of many states, unmetered) farm power.
The first generation of power reforms, initiated at the turn of the century, involved unbundling integrated utilities by separating generation, transmission, and distribution. This, coupled with a series of regulations mandating competitive power purchases by distribution companies, attracted private investment into generation and installed capacity rose dramatically. Discoms had to purchase power from the market at competitive prices and also had to make immediate payments (and not run up dues) for those purchases. Often times, especially in the summers, the prices of spot purchases rose by multiples, leaving discoms with even bigger gap between cost of services and revenue recovery.
This disciplining constraints on the cost-side forced the discoms to get their acts together on the revenues side or figure out ways to bridge the gap. But addressing the revenues side meant lowering technical and commercial losses. Given pervasive theft of supply, billing and collection deficiencies, and unmetered (and free) agriculture supply the latter was 2-4 times the former. This required addressing challenges on state capacity (in billing and collection), political economy (free farm power), and a combination of both (theft of supply).
Now these challenges are not easily addressed. So discoms came to rely on a combination of strategies to bridge the deficit. Primarily, they resorted to large-scale rationing of supply and suppression of demand, through what are called load-shedding or power-cuts. In fact, in India, “peak demand” is deceptive since it only conveys demand of the discoms and not of the consumers. Across vast swathes of North India, consumers are off-grid more hours than they have supply. Rural areas bear the brunt of these power cuts.
Another strategy was to finance the deficit with government subsidies (to the extent of government policy mandated subsidised supply, mainly to farmers) and borrowings. In many states, the government subsidies while sanctioned were never disbursed, forcing the discoms to borrow even more and continuously rolling them over. The Government of India periodically undertook discom debt restructuring schemes with ostensibly strict conditions on loss reduction.

There's an old saying – you can import coal, fertiliser and gas over long distances. But not electricity. That is why, if one has to look at energy security, power generation becomes critically important. Bijlee has become synonymous with modern living. Electricity now touches every life and is critical for our growth and sustainability. Thus, the new government should look at the following:
First and foremost tackle the primary fuel crisis as top priority. The urgent need to step up domestic production of coal and gas needs no repetition. Enhancing production will take time but a rationalisation of coal linkages, which can be done immediately can help ease the primary fuel availability in the short term. There is no sense in hauling coal from Maharashtra to Haryana and then sourcing coal from Odisha for power plants in Maharashtra. The present allocations and linkages to power stations need to be redone on scientific lines. An integrated approach is needed keeping in view coal production centres, power station locations, railway routes, imported coal and ports to put in place an optimum coal allocation and transport policy. Together with this, use of washed coal has to be emphasised to reduce ash, and in turn freightloads, by nearly 30 to 40 per cent.
The present location of generation capacities and inadequate transmission linkages to consumption centers have created a piquant situation where many power stations are stranded or backed down due to lack of demand. At the same time, large areas especially South Indian states have huge demand supply gaps.
Even within states, transmission corridor constraints are causing outages in some areas while power stations idle away. Transmission planning needs to be bottom up with state electricity utilities playing a much greater role in the transmission corridor planning process. While the North-South Grid linkage needs to be made fully operational quickly, even small interventions in terms of completing short-distance interstate lines would help ease the situation in large parts of the country.
In distribution, there is an urgent need to rationalise tariffs. The present, completely-perverse, tariff structure is not sustainable, constricts the growth of manufacturing and service sectors. This is because industry and commercial consumers are charged way above the cost of supply to heavily subsidised agriculture.
Highly subsidised agriculture power is not only killing the manufacturing and service industry but is also causing long-term damage to both groundwater table and soil quality. Moreover, there is no incentive to economise water usage through modern techniques like drip irrigation.

It is pertinent to note however, that with the on-going intensified competition in the licensed and the liberalized electrical sector, many states are beginning to pull their stocks together, shedding the complacency of monopoly to face the competition.
India also faces the problem of inadequate coal and gas production as well as exploration of new fossil fuel reserves.
It is evident that constant power supply is essential for the growth of any nation. India has set out a target to be a global super power having the third largest GDP by 2030 and also to have a sustained economic growth of 8-10% for at least another decade. Many countries have decided to adopt the Indian model as a milestone for developing their electricity sector. At any rate, these countries must first appreciate and put in proper perspective, the challenges associated with the India electricity model in order to be able to build a formidable electricity sector. There is therefore the need to install administrative and regulatory measures that would harmonize the varied interests of investors, developers and consumers in India. Also, robust and comprehensive package of policies should be prescribed for the development of hydro potentials and other renewable energy resources at a faster pace to ensure a sincere commitment towards sustainable development. Finally, whilst the Indian model appears closest to a ‘role model’, Nigeria should only adopt what is ‘uniquely ours’ from the model and domesticate the same for our own purpose.

In an excellent example of crowd-sourcing, the website “Power cuts in India”, launched this summer, invited people to tweet or text information on power cuts in their neighbourhoods. Messages poured in by the hundreds. The site also provided links to newspaper reports on power disruptions and load shedding in different corners of the country. When the seemingly isolated pieces of information were put together, the big picture was clear. India faced an unprecedented and grim situation on the ‘power’ front — one that threatened to bring the country to a standstill.
It is painfully evident that the problem is neither a temporary one nor confined to one part of the country. The malady is pan-Indian and threatens to torment us for a long time.
Given a GDP elasticity factor (amount of electricity required to power 1 percent GDP growth) of 1, we need to ensure an increase of 10 percent in power generation every year. If we need to wipe out existing deficit and bring into the fold about 400 million people who do not have access to power, the target should be much higher. We need an additional 30000 MW every year.
At least, 70 percent of this increase must come from base-load plants that can produce predictable, schedulable electricity round-the-clock and in all seasons. All the rhetoric of adding large doses of clean wind and solar energy can help us feel righteous and green, but these will not serve the immediate purpose, with their characteristics of seasonality, intermittency and unpredictability.
60 percent of our power need is met by coal-based plants, and we continue to place our faith on coal to meet our future requirement. This, we are slowly realising, can be a flawed approach. Large coal plants take many years to come up, if at all. We have not been able to ramp up domestic coal production to meet the growing demand. Relying on imported coal means competing with China for the same sources in Indonesia, Australia and South Africa and paying a high price too. Also, putting all our eggs in the coal basket will lead to serious consequences on the environmental front. The world will hold us accountable for the carbon emission. So we desperately need a second option to help reduce our dependence on coal.
Capacity addition in the form of nuclear plants is desirable, but looks improbable. If an almost-ready is stalled at the last mile, investments in other planned projects may be viewed as fraught with unacceptable risk.

The industry has attracted FDI worth Rs.43,530.99 Cr (US$ 7.24 billion) during the period April 2000 to May 2014. India has emerged as one of the fastest growing economies in the world. Its current economic performance reflects a healthy trend based on increased consumption, investment and exports. Over the next five years, this growth is expected to continue.
The Government of India has identified the power sector as a key sector to promote sustained industrial growth. The Government of India has taken some initiatives to boost the power sector of India. One, it plans to buy the equity of Power System Operation Corporation Ltd (Posoco), a wholly-owned subsidiary of the PowerGrid Corporation of India, at a book value of around Rs.35 Cr (US$ 5.82 million). Two, Agence Francoise de Development (AFD) is extending a Line of Credit (LoC) of 100 million (US$ 134.73 million) for a tenure of 15 years to M/s Indian Renewable Energy Development Agency Ltd. (IREDA) to finance renewable energy and energy efficiency projects in India. Three, there has been an introduction of new online forms for submission of applications, which would help the Ministry function in a more transparent manner. Four, the Electricity Supply Companies (ESCOM) of Karnataka and Andhra Pradesh Power Generation Corporation (APGENCO) have signed a power purchase agreement (PPA) for sharing 230 MW power generated from the Priyadarshini Jurala hydro power project. Five, the Government of India has joined hands with IIT Bombay to implement cost-effective solar powered lighting solutions for the rural population, which will help save 36 million litres of kerosene.
Overall, there is a need for improvement in generation and transmission/distribution of electricity by adapting new, innovative strategies. First, there is a need for renovation and modernisation of generation equipment, i.e., improving the performance of existing old power plants. There is a need to increase the efficiency of coal-based power plants. Currently the average fuel conversion efficiency of the existing thermal power stations is around 30 per cent. In order to increase the transmission capability of power, there needs to be development of National Grid. Then, a significant thrust on renewable energy is needed. To boost investment in renewable energy, it is essential to introduce clear, stable and long-term support policies.

Prime Minister Narendra Modi's decision to open commercial coal mining to private players is a key step towards bringing order to the country's chaotic power industry and ending the chronic blackouts that impede its economic rise. In an executive order posted on the Coal Ministry's website, the government said that any firm incorporated in India may be allowed to mine coal for their own consumption or sale, ending a 42-year-old ban.
Progress of independent power projects has recently accelerated. The 700-megawatt Enron project at Dabhol is under construction, and two power projects have actually started generating power (the 235megawatt GVK project at Jegurupadu in Andhra Pradesh and the 208megawatt Spectrum project at Kakinada in Andhra Pradesh).
India is currently facing energy crisis with its major dependency on coal, crude oil imports to meet sharply growing energy needs of the country. More than 40% household lack access to electricity. There is a need for alternate energy which will not only offset the demand of conventional fossil fuel but also pave way to cleaner solution with less poisonous gases emissions. The alternate solution must be low maintenance and deliver sustained performance in adverse climatic conditions. There is a strong need to push for wider-scale implementation of public-private partnership models. The private sector has been playing a key role in generating power, and in making the desired technological interventions in energy space.
Millions of people in India have no electricity
There is a whole gamut of challenging areas in the power sector that India needs to address on priority in order to meet its growth targets World over the economic growth is driven by energy, either in the form of finite resources such as coal, oil and gas or in renewable forms such as hydropower, wind, solar and biomass, or its converted form, electricity. This energy generation and consumption powers a nation's industries, vehicles, homes and offices.
It also has significant impact on the quality of the country's air, water, land and forest resources. For growth to be sustainable, it must be both resource efficient and environmentally-safe.
In India, the demand for electricity has always been more than the supply.

Calls for more efficient transmission grids and regulation measures
Electricity distribution to the end consumer is the weakest link in power sector, says a World Bank report that asks for transition from administratively-run to commercially-run utilities.
The World Bank report named “More Power to India: The Challenge of Distribution” was conducted at the request of the Government of India and was released in Hyderabad on Monday.
While making an urgent call for change, the study recognises the many impressive strides that the Indian power sector has made over the years. Generation capacity tripled between 1991 and 2012, boosted by the substantial role played by the private sector.
A state-of-the-art integrated transmission grid now serves the entire country. Private distribution utilities in Kolkata, Mumbai, Surat and Ahmedabad, which have been owned and operated by the private sector since before Independence, point to potential gains from private participation. Grid-connected renewable capacity has risen from 18MW in 1990 to 25,856 MW in March 2013. And more than 28 million Indians have annually gained access to electricity between 2000 and 2010.
However, according to the study, the financial health of the sector is fragile, limiting its ability to invest in delivering better services. In 2013, total accumulated losses in the sector stood at Rs 2.9 lakh crore or three per cent of GDP. Around 70 per cent of the sector’s accumulated losses in 2013 came from Uttar Pradesh, Rajasthan, Tamil Nadu, and Haryana. Uttar Pradesh alone accounted for 27 per cent of the sector’s accumulated losses.
Who is the biggest loser?
These losses are overwhelmingly concentrated among distribution companies (discoms) and bundled utilities—State Electricity Boards (SEBs) and the State Power Departments, says the study. Sector losses have led to heavy borrowing— power sector debt reached Rs 5 lakh crore in 2013. More than 40 per cent of the loans were made to discoms.
Over the last two decades the sector has needed periodic rescues from the central government—a bailout of Rs 35,000 crores in 2001 and a “restructuring package” of Rs 1.9 lakh crore that was announced in 2012.

These states are among those that have delayed electricity sector reforms to improve the financial health of their distribution companies and also raising generation capacities of state-owned power utilities.
“Not only does this (power supply scenario) limit future expansion as companies remain wary of not being able to compete, the Indian economy which depends highly on firms trading in the international markets is affected as well,” the survey said, referring to the impact of short-supply of electricity to companies that export goods and services overseas.
In its study, FICCI called for a rapid increase in generation capacity and for improved electricity supply and monitoring systems. To meet these goals, it recommended an increase in solar and wind energy. More than half of India’s generation capacity is based on coal, which is short supply.
India’s alternate electricity industry, with a total generation capacity of about 25 gigawatt is still at a nascent stage. The government is offering tax breaks and others incentives to encourage industries to use green sources of energy.
The survey also sought clear communication from electricity distribution agencies on power cuts so that they can schedule their business plans accordingly. “The information though available is not as uniformly available as it should be and that stakeholders in certain states are hence unprepared for power cuts, increasing the negative impact of power outages on their operations,” it said.
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In the absence of adequate maintenance, reclining poles, sagging conductors, recurrent transformer failures, burnt insulators and failed switches, unreplaced fixtures and so on became commonplace. The result was frequent interruptions, pervasive voltage fluctuations, high technical losses, and accidents with large-scale human casualties.
So what’s the way out?Clearly only the first challenge of enhancing capacity generation, by attracting private investment into generation, has been addressed. There too, the failures on the other parts of the sector threaten to undermine the successes. The issue of high distribution losses and free farm power have remained unresolved.
Privatisation of distribution has been the oft-repeated solution. But experience of private participation in power distribution has been mixed. The limited successes have been in areas with favourable load mix and disciplined consumers, and with none of the underlying problems addressed. Also, unlike generation, political economy factors are relevant at the consumer facing distribution sector.
There is no avoiding the reality that any sustainable solution has to involve addressing the underlying financing problem of the discoms. This requires tariff increases that allow for cost recovery, metering and pricing of farm power, and strict billing and collection. There are no short-term or one-time legislative or regulatory solutions for these. This needs political attention and that too urgently. The house is almost burnt down.
In the meantime, a good and practical bureaucratic starting point would be to appropriately leverage technology to measure and audit supply, and localise and highlight the source of losses. Automatic meter reading (AMR) devices and smart meters now make it possible to easily monitor these in real-time, bill and even control supply to consumers. But given the constraints and the complex challenge, this needs to be done gradually and with great attention.
Fortunately, the very configuration of electricity distribution offers an opportunity to monitor in a gradually cascading manner. Electricity is transmitted from the generators through a cascade of substations. Distribution side starts with the 11kV feeders emanating from each 33/11 KV sub-stations (typically 3-8 feeders with each substation), each feeder in turn servicing several smaller distribution transformers, each of which in turn has several consumers depending on their total load.
There is no dearth of efforts to leverage technology to address the distribution side problems. In fact, there have been programs for several years. The Government of India has had programs to install smart meters upto transformers.

There is much India needs to learn about education – it is not merely a matter of throwing more money at the problem. The Right to Education Act (RTE) passed in 2009 is a farce – it establishes a system of reservations and dilutes educational standards in teachers as well as students. Furthermore, the tax the government has collected as an educational cess sits unused. Recently, Finland‘s schools have shown promising results that India can try and replicate. Until education is made apolitical in India, results cannot be expected. India’s 12 million-per year workforce will not only be a big one but also an unqualified one.
Energy: India’s booming economy is an energy guzzler, and successive governments have yet to achieve anywhere near 100% electrification. At least 25% of Indians have no access to electricity. India desperately needs energy to sustain its industrial growth, adding approximately 1,200 GW by 2050 to its presently installed 185 GW capacity. The per capita consumption of electricity in India in 2011 was 778 KWh, while in the European Union, it is 6,200 KWh.
While the government has finally woken up to the impact of 8-hour load shedding on the economy, it has recently been impeded in its power plans by demonstrators against nuclear power at Kudankulam and Jaitapur. India’s energy plans need to be better than good to not only post an increase for industrial use but to make up for the less than full electrification at present (there is a 13% shortfall). Nuclear energy is not the only way forward but it is fastest and cleanest. India cannot meet its energy needs through thermal power plants as India has neither the mining nor the rail system surplus to deliver the coal to the power plant. Furthermore, the ash content of Indian coal is significantly higher than other varieties of coal, creating greater inefficiency and pollution. Renewable energy simply cannot deliver the volume of energy needed to power India’s growth. On the other hand, reactors can be built in India as well as purchased from abroad with generous lines of credit.
Power generation is not the only problem India needs to focus on. Approximately 32% of generated electricity is lost in transmission or theft, compared to a world average of less than 15%. Without sufficient power, the lights could very well go out on India’s economy.

The bottlenecks in the country’s transmission and distribution networks have been blamed.
“Lack of investment in transmission and distribution infrastructure has resulted in congestion of the network in India, impeding the evacuation of power and the development of a competitive market,” the World Bank says in its report.
That is one of the reasons why most of the power plants in the country are operating a little above 50% of their capacity, known as Plant Load Factor.
Share of world’s total
From 7%at present
To 14%by 2040
Source: BP Energy Outlook, 2019
Some experts fear if electricity cannot be fully evacuated from existing power plants in distant places, then states could start having their own plants.
Two major coal-fired power plants have recently been approved in Bihar and Uttar Pradesh.
“Political competition between parties can create that situation, particularly if this election results into a grand coalition government,” says Mr Krishnaswamy.
“But that competition could also result in installation of solar plants. But again will the renewables be able to supply the amount of energy they are now promising?”
Some say that now looks increasingly possible because renewable energy in India is becoming much cheaper than electricity produced from coal burning.
“The move towards renewable electricity will keep on happening because we see that as being the most cost effective way to meet people’s needs,” says Mr Mathur.
“Our action is not based on environmental aspirations, it is based on hard economic realities.”
Renewables can generate only when there is the Sun and wind – but India’s peak demand time is before midnight.
Battery technologies to store renewable energy cannot yet be source of stable electricity supply.
“For stable power generation, coal is our necessity and our plants will need more coal,” says Shailendra Shukla, head of the power generation company in Chattisgarh.
“The day an alternative is available, we will stop using coal.”
But even with so much of coal burning, the Indian government says it is already on its way to meet its commitments under the Paris deal.
Low per capita emissions
“India has been one of the top performers in terms of living up to climate commitments,” says Mr Krishnaswamy.
“But is that adequate?

The country has about 25,000 Mw of idle and underutilised electricity generation capacity as private companies set up power plants in anticipation of high prices, Power Secretary PK Pujari said at the launch of ETEnergyworld.com.
Surplus production was also a problem in the coal sector, Coal Secretary Anil Swarup said. "Earlier, I was pressurised for coal deficit, now for surplus... I have coal, I have rakes, I don't have demand," Swarup said at a panel discussion on his sector.
In the renewable energy sector, the ambitious expansion of solar energy was worrying distribution companies, which had their own power generation units, but the government would resolve the matter, Renewable Energy Secretary Upendra Tripathy said.
He said the government was in talks with distribution companies for faster adoption of rooftop solar projects. India plans to achieve 100 Gw of solar power generation and 60 Gw of wind power by 2022.
Currently, installed solar capacity is around 5,700 Mw and wind over 25,000 Mw. Sector experts and officials say that the rapid expansion in renewable energy poses several challenges of transmission and grid stability as well as reluctance of state discoms to support the sector.
"We do understand that some discoms have a lot of opposition to rooftop solar, because the moment customers start producing their own power on their rooftops, they will not be buying from the discom anymore. But we will resolve this issue," he said.
Panelists said capacity utilisation of thermal plants had fallen sharply due to sluggish industrial growth and inefficiency of state discoms. The power secretary said the demand-supply mismatch in the sector is likely to balance out in the next four to five years as industrial growth picks up.
Pujari said the average capacity utilisation of thermal power plants is 61%. While central public sector units have load utilisation of about 70% and private producers around 65%, power plants owned by states proved to be laggard by operating at 53% of their capacity. He said capacity utilisation had fallen in the small, inefficient units.
Association of Power Producers Director-General Ashok Khurana said there was a need to change coal supply policy to supply coal to power plants with medium-term power purchase contracts with distribution utilities. The other speakers in the session were Sterlite Grid Vice-Chairman Pratik Agarwal and ICRA Senior Vice-Pesident Sanyasachi Majumdar.

Following the assessment, EGI has begun a project that could provide a pathway to avoid another disaster like India’s recent blackouts. The project seeks to develop a holistic and participatory approach to electricity planning, working with decision-makers to close the “holes” and explore the potential of improved energy efficiency and renewable energy in order to shrink the demand-supply electricity gap.
Indian civil society can also play a role in improving governance. Citizens can create a “demand” for improvements by asking that information on sector problems and potential solutions be placed in the public domain. They can also hold decision-makers accountable for providing affordable, reliable, and quality electricity for all. Unless both citizens and decision-makers start to chip away at India’s core governance problems, blackouts—and a host of other power problems— will likely become increasingly common.

Last year, the Central Electricity Authority reported that India is on the verge of being a power surplus nation. For a country accustomed to power shortages, this may appear to be a major step towards reliable electricity supply. But surplus power has not eliminated shortages. In particular, rural India continues to face power cuts.
What explains this paradox?
Surplus power occurs when the power available with distribution companies at a given time exceeds the demand for electricity. A surplus could arise due to a fall in the demand for power, for instance, during an industrial slowdown. Or it could result from an increase in power supply, for instance, when a new generating station is added. Insights from various states show that the burgeoning surplus is more due to an increase in power supply, as we explain in a subsequent article.
But first, we explain why surplus power is a problem. To start with, it has put a significant financial burden on distribution companies and may adversely impact their already precarious financial positions.
Cost of power
Most power procurement by distribution companies is done through long term, 25-year contracts with power generating companies. These contracts legally bind the distribution companies into paying the generating company a lump sum annual amount for fixed costs, and a per-unit charge to cover variable costs (mostly for fuel).
Distribution companies have to pay the fixed charges even if they do not draw power from the generating company for a particular time period. If such surplus cannot be sold, it is backed down, which means power generators lie idle at that time, incurring fixed costs, but generating no electricity.
The table below shows the financial impact of backing down in five states.
In effect, states are paying for surplus power that they do not use. Fixed cost payments to power generators due to backing down are as high as 15% to 35%. In Gujarat, the payments are more than three times the agricultural power subsidy, and in other states, they amount to about 40% to 60% of power subsidies by the state government.
Such costs are eventually borne by the electricity consumers.
A problem of contracts
As distribution companies with surplus power have entered into long-term, legally-binding contracts for power, it is difficult to surrender or re-allocate such capacity. Therefore, the most common strategy to mitigate the cost of surplus power is to ensure its sale.

Despite having made deep inroads in the sphere of Information Technology, and also good progress of development in the field of road connectivity, our country is way behind to be tagged along with the developed countries. The reason is not very complicated to understand. Primarily, it is the bad power sector. We see to run short of electricity, despite the fact that hydro-electric power generation in our country had been given lots of thrust by the Congress Government, under Pt. Nehru. Soon after Independence, the construction of the Bhakra dam started in 1948. During its inauguration, Nehru said, ‘these structures are the temples of modern India.’ Nehru was a visionary. He knew that India minus electricity will never be able to even think of competing with the developed nations.
It was in Nehru’s tenure, that the construction of the Tarapore Atomic Power Plant was taken up in 1962. This was again because of his vision and of course due to foresight of Homi J. Bhabha, the great nuclear physicist, who launched the development of nuclear energy in India.
In the post-Independence era as the demand for electricity increased in leaps and bounds, India switched over to thermal energy. During the period 2010-11, the distribution of energy generation in the country was as follows:
Liquid fuel: 0.41% and
import from Bhutan: 0.78%.
- (After, India Energy Book 2012).
Of course to these figures the energy generated from other sources like solar, wind and geothermal are not added-as at present their input is minuscule But yes, locally every day we hear of a new solar power plant or a wind energy farm coming up.
All to all the scenario is that we need much more energy than we get. But the problem is how to generate that energy? There is a strong opposition against the hydro-electric power, mainly because it requires a river to be dammed and the people living in the upstream get damned by the dam. Though, the opposition is not because of the protests by dam victims. The opponents of the dam believe that the rivers of the north Indian plains are shrinking up because of the dams in Uttarakhand. Then there is a very strong anti-nuclear lobby.

With an energy growth of just 1.5%, it is difficult to see how even a 4% GDP growth can be sustained.
Three problems bedevil the power sector, all of which are addressable, if only there is clear focus and political will.
The first is the inability of the government to usher in laws which allow the RBI to deduct the amounts due to power distribution companies (discoms) directly from the funds paid into state accounts. Instead of using its brute majority to usher in divisive agendas like the CAA (Citizenship Amendment Act), the government ought to have brought in more sanity into power revenue recoveries. The trouble is that when it comes to controlling power profligacy, often used as a means for winning elections, the knees of policymakers begin to buckle.
The second is the unwillingness of policymakers to realise that the maximum bang for the buck lies in promoting (off-grid) rooftop solar. There are several reasons for this. As Tripura showed last year (http://www.asiaconverge.com/2019/10/solar-energy%e2%80%88ministries-practice-deceive/), the average cost of providing grid connectivity to households is over Rs.2 lakh per household on an average. The cost of a rooftop solar installation is just Rs.50,000. Then there is the issue of supply reliability. Rooftop solar is more reliable as a source of power than grid power, because – for a variety of reasons, both technical and collusive — state engineers resort to power-cuts and shut-downs. Most rural folk thus prefer off-grid rooftop solar to grid-connectivity. The third is the economic benefit that comes from rooftop solar. It has the potential for creating over 80 million jobs within a couple of years (http://www.asiaconverge.com/2017/12/sabotaging-rooftop-solar-and-employment-generation/). It can actually generate employment – kickstarting small and medium enterprises at the grassroots level. And it reduces the cost of imports, as the country learns to depend less on imported fuels.

On the other hand, states like Orissa and Himachal have surplus power, and the eastern zone is comparatively safer than other zones.
Power consumption is also driven by industry and states like Maharashtra and Tamil Nadu have lots of it, at least compared to Himachal and Orissa.
Let’s revisit the The Load Generation Balance Report 2012-13 published by the Central Electrical Authority that illustrates the power scenario prevalent in India and in different zones:
Figure 2 (a)
Figure 2 (b)
If we were to summarise:
*All zones, barring western, saw an increase in demand from last year during the peak season.
* Southern zone has a 26% deficit in meeting demand as against the all-India average of 10.6%; and
*Only eastern zone has surplus power after meeting demand.
So, from the data available, it seems that North-East could probably be the next zone to face serious power outages. The shortfall is nearly 22% as against the national average of 10.6%.
Figure 3 gives an idea of the anticipated supply position of the top 5 power deficient states during 2012-13. Bihar has surprisingly low consumption, a fourth of even a small state like Punjab. This suggests that were Bihar to expand economically, as is widely predicted and expected, than the dependence on power will skyrocket. Interestingly, there are 13 states that have a shortage of over 20%.
So, it can be seen that two North-Eastern states – Nagaland and Tripura – are projected to have the highest shortages, proportionately, followed by Punjab and Bihar. Tamil Nadu, which is currently reeling under crisis, is also among the top 5 states.
Only Himachal Pradesh (52%), Sikkim (34%) and Orissa (12%) have surplus power. The surprise here is Himachal with more surplus than Sikkim and Orissa since the state has been making big strides in development.
The Government of India had set the goal of electrification of all households during the XIth Plan (2007-12), Incidentally, India has seen its deficit increase to 10.6% (from 9.8% in 2010-11), and 56% villages still do not have access to electricity.
Estimates by consulting firm KPMG say India’s power consumption could double by 2020.

Even though energy projects are often constructed in the name of poverty alleviation and rural development, they’re largely focused on meeting the demands of the urban rich. (Note “demands” should be differentiated from the normative term “needs.”) Therefore, it shouldn’t be surprising that even official estimates show that around 56 percent of rural households in the country didn’t have electricity in 2000. These residents live without adequate lighting, and many spend hours each week collecting firewood because they don’t have access to modern cooking fuels. An October 2007 Greenpeace report shows how the rich in India have much higher carbon emissions compared to the poor.
Not only do the poor and marginalized in India not have access to electricity, they also often face the brunt of the negative consequences of generating electricity for the rich. In a densely populated country such as India, a significant fraction of the population is directly dependent on land, water, and forests. Practically all large-scale electricity generation projects in the country–whether coal plants, nuclear plants, or large dams–impact these resources, and most recent large-scale electricity generation projects have met with stiff resistance from local inhabitants. (See “Haripur: Land for Nuclear Plant” and “Campaign Against Coal-Based Thermal Power Plant Project,” an online petition signed by hundreds of people who oppose a proposed coal-based thermal power plant in India’s Chamalapura Valley.) This alone makes it unlikely that massive expansion of large and centralized energy projects will materialize anytime soon.
Independent energy analysts have shown that it’s possible to plan for energy and electricity in a way that caters to India’s marginalized poor and that this makes financial sense. Studies using the development-focused end-use-oriented service-directed (DEFENDUS) paradigm for energy pioneered by the late Amulya Reddy and his collaborators have shown that in contrast to conventional energy planning, DEFENDUS could result in greater achievement of development objectives at far lower cost in a shorter time. And because of the emphasis on improved efficiency–as well as the use of decentralized and renewable sources of electricity generation wherever it made economic sense–it also resulted in enormous environmental gains.
The necessity of such methods of energy planning that pay attention not just to overall electricity generation targets but also equity and environmental sustainability is implicitly highlighted by the National Action Plan on Climate Change.

Ending India's Massive Power Grid Outages
On July 30th and 31st, the world's largest blackout — The Great Indian Outage, stretching from New Delhi to Kolkata — occurred. This blackout caused by northern power grid failure left nearly 700 million people — twice the population of the U.S. — without electricity. A grid failure of this magnitude has thrown light on the massive demand for power in a country and its struggle to generate a much-needed power supply.
India aims to expand its power-generation capacity by 44 percent over the next five years. In June, the country's power generation fell short by 5.8 percent against a peak-hour demand for 128 gigawatts, according to government data. India is divided into five regional grids, which are all interconnected, except for the southern grid. All the grids are being run by Power Grid, which operates more than 100,000 kilometers of electricity transmission lines.
Serious concerns have been once again raised about the country's growing infrastructure and inability to meet its energy needs. Government officials have concluded, "The grid failed because of the overloading of power," and contend that "many states" try to take more power than they are allotted from the grid.
The country's lack of energy security is a major constraint to its capacity to generate power. The slow pace of tariff reforms is hindering infrastructure investment at the state level in most parts of the country. The centralized model of power generation, transmission and distribution is growing more and more costly to maintain at current levels to meet increasing energy needs. The blackout and shortage of power are hampering India's economic growth and its capacity for growth.
Article continues at ENN affiliate, Triple Pundit
Image credit: Defense Pakistan

Economic growth is energy hungry and much of the incremental energy needs will be delivered in the form of electricity. For India’s progress to continue unhindered for the coming 25 years, the role of its electricity sector will be absolutely pivotal. Despite obvious challenges, our political leaders do recognise the critical role that a strong electricity sector will play. The past 25 years of reforms have put the sector on a rather strong footing. The time is opportune to solve the last-mile reform challenges, which will set India up well for the coming 25 years with a debt-equity structure of 70:30.

While India has up to 900GW of renewable energy potential, according to the Ministry of New and Renewable Energy, this nevertheless represents an impressive target given that only 37GW are currently installed.
The level of ambition is even stronger for solar energy, of which the government aims to deploy 100GW by the same date—from just 3.3GW in 2014. Such a rapid capacity increase would be unprecedented globally. Combined, Germany and China, each of which has sustained large levels of investment for years, have barely been able to deploy two-thirds of that (66.3GW). In addition, notes Sasha Riser-Kositsky, associate at the Eurasia Group, such a rapid deployment might encounter infrastructure constraints. “India’s grid probably cannot handle the 40GW of roof-top solar planned,” he notes.
Even if, as the IEA expects, low-carbon technology accounts for more than half of total new power-generation-capacity additions over the next 25 years, the sheer scale the growth in coal demand will be such that India’s emissions will nearly triple over the same period.
This will still leave per-capita emissions levels below the world average, suggesting that despite higher emissions, the contribution of India to the climate change problem will remain limited compared with that other countries, including China and the US.
But it also means that India can do much more to improve the energy efficiency of its coal power fleet, which at the moment is dominated by subcritical coal power plants (85%). Given that new coal plants in China or the OECD are nearly 10% more efficient, technology transfer will be an integral part of keeping emissions in check. Reforming the electricity sector will also be required. High electricity losses, theft and poor financial performance, in particular, are making it difficult for distribution companies to purchase all of the electricity supply, notably for natural gas but also for coal-fired power plants, “whose load factors have decreased this year”, points out Mr Riser-Kositsky.
Overall, between the power generation side and the grid infrastructure, the IEA estimates that some $2.1trn of investments will be needed by 2040 in the Indian power sector. This substantial amount (roughly equivalent to what the US will have to spend on its power-sector infrastructure over the same period) is urgently needed: Despite a doubling of energy consumption since 2000, 240m Indians still lack access to electricity today.

Timeliness in actions has often been missing, resulting in the landmark judgment of the Appellate Tribunal (APTEL) in the OP 1 of 2012 case, where APTEL passed explicit directions to all state regulators for compliance with certain basic functions enjoined in the Electricity Act, 2003. Despite that judgment, the development of these critical institutions has been slower than desired because, in general, there is a lack of both will (or courage) and of institutional capability. The state-level electricity regulators urgently need capability enhancement, greater resources and arguably a more clearly defined operating blueprint. Such a blueprint ought to have granular definitions on a strategic framework for regulation; more robust instruments of regulation that are tightly aligned to the objectives of the Electricity Act, 2003 overall regulatory work plans; monitoring frameworks for the implementation of regulations; review of performance and information dissemination, etc. Right staffing, capacity building and access to the right tools and capabilities will be very important. The gap between the current and the desired state in these institutions is indeed very high. In effect, unreformed state-level institutions are like the Achilles’ heel of the Indian electricity sector.
Will these points of weakness be any different in the foreseeable future? Reforming the unreformed elements will be a long path but, I dare say, that I see hope for several reasons. Despite the structural and ownership challenges to competition and efficient functioning, the pressures are being inevitably felt by the laggards. A laudable feature of the Electricity Act, 2003 is that it did not limit any possibility artificially by being judgemental on what is economically feasible and what is not. This, in effect, is resulting in competitive pressures being exerted on the incumbents to become efficient or face financial consequences. Efficiencies in technical and commercial operations have indeed improved over the years, manifested in sharply reduced aggregate technical and commercial losses in most states, though arguably there is room to do more. Administrative measures by the Government of India, such as the rules on late payment surcharge, have reduced payment delinquency to generators. Consumer rights are increasingly on a better footing with improved supply infrastructure, enhanced hours of supply and quicker rectification of faults. Recent experiences in the re-privatisation of Odisha distribution licensees have gone on to demonstrate that ownership changes can be successful, if backed by appropriate political commitment and support.
India is uniquely placed in the world as a large growth economy.

When I served as a Pennsylvania Public Utility Commissioner from 1993 to 1998, my two most important duties were keeping drinking water safe and the lights on. A nightmare scenario was an uncontrolled, cascading electrical grid failure and blackout.
That nightmare scenario unfolded in India on Monday, when a then world record blackout knocked out power to 300 million Indians. The very next day, a worse blackout hit, knocking out service to more than 600 million people or about half the population of India. Both were uncontrolled, cascading outages.
Here are some key facts and further thoughts about India's electricity situation.
India's daily peak demand is regularly 12% higher than peak supply but the shortage is managed through rolling or controlled blackouts that cut electricity supply deliberately to specific locations to balance supply and demand.
The basic problem in India is that daily demand outstrips supply. There is just not enough power or generation that pushes the grid in India just about everyday to what would be considered a crisis in the US.
In fact, the USA has a mandatory generation adequacy or reliability standard that requires enough electric generation be available to make the probability of even a controlled blackout no greater than one day in ten years. Indeed, apart from Texas, America has excess generating capacity--an amount of capacity that exceeds even the protective mandatory reserve requirements--in just about every region.
Despite the massive generation needs in India, India has built only about 50,000 megawatts of new generation in the last 5 years or about 5% of the total US generating capacity. That is just not enough to begin to meet India's basic electrical needs. Not even close.
Over the same 5 years, China, however, has built approximately 300,000 megawatts of new generation.
As for the US, even though we have an excess generating capacity position, America typically builds 10,000 to 20,000 megawatts of new generation every year. According to EIA data, to date more than 8,000 megawatts of new generation began operating here through June.
The shock of a cascading blackout to a society--especially a democratic one like India--is enormous. Count on India launching a massive priortization of resources to building much more generation and taking other steps to close its gaping electric demand and supply gap.

These reforms could be good news for advocates of sustainable energy in India. For one, reducing grid power losses and theft would inherently improve the efficiency of the electricity system. Furthermore, a well-functioning electricity grid is a prerequisite for integrating large amounts of variable renewable energy sources such as wind and solar. The improved ability of SEBs to finance power purchase agreements could also increase opportunities for renewable electricity generators to sell power to the grid in a more efficient and transparent process.
Given the severity of the crisis facing India’s electricity sector, SEBs should be monitored closely in the coming years to ensure that they implement the reforms necessary to ensure a secure, reliable, and affordable electricity supply throughout the country. Improvements in electric utility governance and infrastructure must be combined with robust renewable energy incentives and rural electrification programs in order to transition India to an energy system that is socially, economically, and environmentally sustainable.
Homepage Image: India's Raisina Hill. (Ambarish Singh Roy)
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There is no question that India desperately needs to generate more power. The energy indicators say it all. It has the lowest per capita consumption of electricity in the world. This when access to energy is correlated with development, indeed with economic growth.
Let us not dismiss the need for energy as a simple issue of intra-national equity when the rich use too much, while the poor do not have enough. This may be true for other natural resources, but energy scarcity is more or less all around. Data shows India’s energy intensity has been falling—we do more with each unit of energy produced. In industry it is down by 2.2 per cent between 2004-05 and 2008-09, and in the agriculture and the service sector by as much as 4.7 per cent annually.
The reason is not hard to see. India has one of the highest prices of energy and it does pinch industry and the domestic consumer. So saving is part of the energy game. This is not to say we must not do more to cut energy use and be more efficient. The point is there are limits to efficiency.
But why am I stating the obvious? The reason is that even though India knows it needs more power, it does not realise it will not get it through conventional ways. It will have to find a new approach to energy security before the high-sounding targets of the power ministry are derailed and ultimately energy security compromised.
Just consider what is happening in the country. There are widespread protests against building major power projects, from thermal to hydel, and now nuclear. At the site of the coal power plant in Sompeta in Andhra Pradesh, the police had to open fire on some 10,000 protesters, killing two. In the alphonso-growing Konkan region farmers are up in arms against a 1,200 MW thermal plant, which, they say, will damage their crop. In Chhattisgarh, people are fighting against scores of such projects, which will take away their land and water. The list of such protests is long even if one does not consider the fact that most of the coal needed to run them is under the forests, and the mines are contested and unavailable.
Hydel projects are no different. Environmentalists are protesting the massive numbers of projects planned on the Ganga that will virtually see it dry over long stretches.

However, Indian companies have the opportunity to increase the utilization rate of their existing assets and improve sales per asset by catering to both the foreign and growing domestic market.
The electric power sector in India is witnessing several changes and new trends. The country’s installed capacity for electricity generation has increased from 174.64 GW in March 2009 to 356 GW in March 2019; this was the fifth largest in terms of installed capacity globally, and third in terms of power generation and power consumption. The government targets capacity addition of around 100 GW under the 13th Five-Year Plan (2017-2022). India’s power sector is forecasted to attract investments worth $130 billion between 2019-2023.
Trends and Outlook
Lately, we’ve witnessed an unprecedented price drop in the solar power sector in the country. The costs of building large-scale solar installations in India fell by 27 percent in 2018. On the other hand, falling capacity utilization of power generation plants is compelling the industry to come up with innovative technical solutions. These include upgrades and modernization to bring more flexibility into operations to enable quick ramp up or ramp down.
Increased economic activity, especially in manufacturing, along with favorable government policy, drive steady growth in electric demand. The government has introduced and refurbished a series of schemes and policies to strengthen the power sector. The Ujwal DISCOM Assurance Yojana (UDAY) scheme focuses on improving the financial health of the electricity distribution companies. The government is promoting awareness on energy efficiency and power saving. The industry has been deeply involved in the successful implementation of Deendayal Upadhyaya Gram Jyoti Yojana UJALA. This has resulted in energy savings of more than 2.66 crore kWh every day, a reduction of over 21,550 tonnes of CO2 per day, and is estimated to have a cost savings of $1.39 million per day.
India’s electric power industry needs to explore the benefits of investing in distributed generation, smart grid, and other verticals. The government has set an ambitious target of having 175 GW of clean energy capacity by 2022, including 100 GW solar and 60 GW of wind energy.
Renewable industry presently constitutes around 21 percent of the total installed base and is on an accelerated growth path in both solar power and wind power generating plants. Presently, India's clean energy capacity is 1,096 GW.

The mismanagement of power in India
RN Bhaskar – 02 January, 2020
The sins of the past are finally catching up with the power sector. The energy situation has worsened, and could get worse, as policymakers hurtle from one blunder to another.
The first serious effort to address this malaise was during the Vajpayee government, when the New Electricity Act was ushered in, and states were urged to rein in power losses.
But soon, power subsidies and power theft were allowed to rear their heads again. This was followed by clever methods to hide the losses under the carpet, especially with UDAY (Ujwal DISCOM Assurance Yojana) which was launched in November 2015 (http://www.asiaconverge.com/2018/09/discom-losses-continue-to-bleed-the-country/). Ironically, even Crisil – India’s premier credit rating company — touted UDAY’s virtues (https://www.crisil.com/Ratings/Brochureware/News/Discom-losses-to-nearly-halve-by-fiscal-2019-on-reforms.pdf). It had curiously overlooked two key numbers – the average cost of supply or ACS and the average revenue received or ARR. If the gap between the two increases, then the scheme is just not working. If the gap narrows, the scheme could be said to be working. And the truth was that this gap has kept increasing (for the country, barring a few states). The hole has become larger and larger.
As a recent CARE Ratings report pointed out, “Power generation during April-October 2019 recorded [just around] 1.5% growth at around 843 billion units (BU). . . . .The share of thermal power in the overall power generation has dropped to its lowest level since 1991-92 at 72.8% during the current financial year.”
What is even more interesting is that the industrial powerhouse of India, Maharashtra, which accounts for much of power consumption, saw power supplies down (by -5.6%) during the April-October 2019 period (compared to the same period in 2018). Ditto for Gujarat which saw power supplies fall by 3.9%. Clearly, the industrial engines of the country had begun to sputter.

Chief among the risks for mini-grid operators and investors in India is the arrival of the central utility grid to a mini-grid-serviced area – often via low-voltage distribution lines, at high cost and incurring significant network losses. Given the extremely low discom tariffs, these grid extensions – even though they often provide unpredictable and insu fficient power – are highly disruptive to DESCO project economics, despite clear customer preferences for more reliable services.
Investors see other risks in the mini-grid model, sometimes erroneously. REEEP’s investigations revealed significant concerns connected to customer behaviour, particularly theft and non-payment, but these issues have largely been overcome by operators.
Electrical power is a political issue in India, as it is in most countries. Power is subsidised, and likely will be for a great many years to come. There have been encouraging signs in 2016 and 2017 of government interest in DRE mini-grids, both at state level, with the ground-breaking release of the first state mini-grid policy in Uttar Pradesh, and at the central government level, with movement towards a national mini-grid policy. Indeed, just prior to publication of this report the Modi Government announced a plan to electrify every household in India by 2019.
The $2.5b plan, known as Saubhagya, is both ambitious and risky, dependent as it is upon a blend of public and private financing, but relying largely on public or quasi-public institutions to deploy and maintain. It will also likely test the limits of the government in overcoming structural economic and physical barriers, as this report will show. But current incentive schemes are sub-optimal, the procedures for securing them are unclear and lack transparency, and it is unknown whether they will be available at the scale required for mini-grids to make a significant impact on the “Power for All” challenge.
Ultimately, the sector will require long-term cooperation between the public and private sectors in order to render DESCO-model mini-grid deployments viable at scale and attract sufficient amounts of domestic and international investment. Such cooperation is sensible and to be expected, given the characteristics of the rural electrification space.
An important consideration for securing funding is that international development cooperation agencies, development financing institutions (DFIs) and multilateral development banks (MDBs) have expressed interest in supporting climate-smart energy access in India. DRE mini-grids offer precisely this kind of power.

In India, 46 million, mostly rural, households lack access to electricity – over 50% of those are in the states of Bihar and Uttar Pradesh. While India has set an aggressive goal of extending the grid to all households by 2019, grid extension does not necessarily imply reliable electricity access. Indian utilities face a financial disincentive to supplying reliable electricity in rural areas because of subsidized tariffs and low consumer willingness-to-pay. Tariff subsidies for full household electrification in these states would be about Rs 15,000 Cr per year, which is two-times the existing subsidies and equivalent to 20–30% of their annual utility revenues. We find that superefficient lamps, TVs, and fans can reduce the energy consumption of a rural household by over 70% costeffectively, resulting in a net reduction in the total subsidy burden. Reduced consumption offers an opportunity to raise consumer tariffs while ensuring consumers’ monthly electricity bills reduced. We also argue that superefficient appliances make consumer-side storage cost-effective, leading to greater consumer willingness-to-pay. We recommend adoption of super-efficient appliances as part of the electricity access initiative in India, and electricity service based tariff setting as the next policy steps towards providing a reliable and sustainable electricity access.

What Do India’s Recent Electricity Sector Reforms Mean for Renewable Energy?
|In July, 620 million people in India were plunged into darkness during the world's biggest power outage to date. (AP // Bikas Das)|
In the wake of massive blackouts this past summer that spanned 20 Indian states and left half of the country’s population without power, the national cabinet approved a debt restructuring program for State Electricity Boards (SEBs) in September aimed at improving the functioning and viability of India’s electricity sector. SEB debt across all states is currently over US$35 billion, or about 2 percent of the nation’s GDP.
SEBs are state-owned utility companies responsible for operating the electricity grid and delivering electricity to customers. SEBs buy electricity from power generators at a price negotiated through a Power Purchase Agreement (PPA), which they in turn sell to electricity consumers. Lack of necessary investment to improve grid infrastructure, widespread electricity theft, and low electricity prices that result in SEBs often selling power to customers at a loss are among the systemic problems in many states. Electricity losses during transmission and distribution to customers—due to grid inefficiencies, electricity theft, and illegal grid connections—account for more than 25 percent of power generated in India.
The cabinet-approved debt restructuring package aims at addressing some of these problems. Under the program, state governments will take on 50 percent of SEBs’ short-term liabilities over the next two to five years. The remaining 50 percent of short-term loans will be rescheduled by lenders, providing SEBs with favorable interest rates and a three-year moratorium on principal payments. SEBs have until the end of this year to sign on to the program, which will apply to debts accumulated through March 2013.
If the program has the desired impact, reduced debt pressure on the state utility companies will allow them to invest in much-needed infrastructure and operation improvements and revitalize the electricity sector by enabling new PPAs that are currently beyond SEBs’ financial capacities.
In order to qualify for the restructuring package, SEBs are required to implement several reforms aimed at improving their financial viability and provision of services. The conditions include that SEBs may not take on new short-term loans, must collect outstanding power dues from customers, and must reduce electricity losses by at least 25 percent. State governments must also regularly review electricity prices, which will likely result in price increases for consumers in order for SEBs to generate enough revenue to cover operating costs.

|| Current plans to provide “Power for All” in India via the country’s utility or distribution companies (known as discoms), through main-grid extension and utility-scale generation projects, are largely polluting, slow to build, and expensive. The central utility grid is 70% coal-powered, and the proportion of fossil fuels is still expected to be greater than 50% of the energy mix in 2040, despite high targets for renewable-energy generation capacity and heavy investment in it.
Grid power projects and extension, such as laying high-voltage transmission lines, take years from conception to completion, incurring enormous time-linked opportunity costs for underserved communities, in addition to the already extremely high capital costs of such infrastructure. However, the weakest link in the power value chain is distribution. This challenge
is ultimately political and economic in nature, since with few exceptions discoms are chronic loss-makers and perpetually stressed financially. Providing power for all under the existing paradigm will therefore be a drawn-out and hugely expensive enterprise, despite the successes of existing government electrification programmes.
Mini-grids powered by decentralised renewable energy (DRE), and operated by distributed energy service companies (DESCOs), which provide a utility-like service on a for-pro t basis, can offer a long-term, solution for the underserved, which can expand rapidly and easily along with demand. DRE-powered mini-grids are quickly deployed and reasonably priced. Furthermore, if done in the right way, such mini-grids can be integrated with the main grid at a later date. Equally significant, DRE power is environmentally cleaner than coal – or diesel-generated alternatives.
Mini-grids and DESCO business models, particularly those based on solar photovoltaic (PV) cells with battery storage, have largely met with success in eld tests, providing both reliable and significantly cleaner power than the hundreds of thousands of diesel generators that provide electricity across many rural villages. DESCOs give households a “grid experience” unmatched by localised solar home systems (SHS), in addition to providing household and commercial customers with economic opportunities for energy-intensive appliance upgrades.
DESCO-operated mini-grids are not yet viable on a purely commercial basis, due to high up-front capital expenditures, low levels of initial effective demand, and high levels of uncertainty among investors as to the sector’s long-term viability.

08 / 2010
There is no question that India desperately needs to generate more power.
The energy indicators say it all. It has the lowest per capita consumption of electricity in the world. This when access to energy is correlated with development, indeed with economic growth.
Let us not dismiss the need for energy as a simple issue of intra-national equity when the rich use too much, while the poor do not have enough. This may be true for other natural resources, but energy scarcity is more or less all around. Data shows India’s energy intensity has been falling—we do more with each unit of energy produced. In industry it is down by 2.2 per cent between 2004-05 and 2008-09, and in the agriculture and the service sector by as much as 4.7 per cent annually.
The reason is not hard to see. India has one of the highest prices of energy and it does pinch industry and the domestic consumer. So saving is part of the energy game. This is not to say we must not do more to cut energy use and be more efficient. The point is there are limits to efficiency.
But why am I stating the obvious? The reason is that even though India knows it needs more power, it does not realise it will not get it through conventional ways. It will have to find a new approach to energy security before the high-sounding targets of the power ministry are derailed and ultimately energy security compromised.
Just consider what is happening in the country. There are widespread protests against building major power projects, from thermal to hydel, and now nuclear.
At the site of the coal power plant in Sompeta in Andhra Pradesh, the police had to open fire on some 10,000 protesters, killing two. In the alphonso-growing Konkan region farmers are up in arms against a 1,200 MW thermal plant, which, they say, will damage their crop. In Chhattisgarh, people are fighting against scores of such projects, which will take away their land and water. The list of such protests is long even if one does not consider the fact that most of the coal needed to run them is under the forests, and the mines are contested and unavailable.
Hydel projects are no different. Environmentalists are protesting the massive numbers of projects planned on the Ganga that will virtually see it dry over long stretches.

The BJP-led Indian government has been keen on augmenting its nuclear power generation capability but the director of the national apex body for Training and Human Resources Development in power sector says lack of transmission infrastructure is the biggest impediment on this road. Director General of National Power Training Institute Dr. Rajendra Kumar Pandey lays down the challenges in the way to Nuclear Generation threadbare in an interview to Nuclear Asia.
In France 70 per cent of electricity is generated through nuclear power. In India, currently 60 per cent of our power is supplied through thermal energy. Under such circumstances, can nuclear energy be the next best alternative?
As per Bhabha Atomic Research Centre (BARC) and the Department of Atomic Energy (DAE) the nuclear power capacity is expected around at 30,000 MW and that it can become the cleanest source of power. But, there is this notion among the people that nuclear power is dangerous. This despite the fact that many advanced countries are operating with nuclear power.
The government previously had the goal of 100 GW of solar, 60 GW of wind and 15 GW of biomass etc. When it was felt that generating 100 GW of solar is very difficult, they included hydro as well. So now if you look at any government declaration, it is 40 GW by 2022, which was 100 earlier. It means that nuclear has been left in totality, hydro and solar has been combined to 100 GW, 60 GW of wind and 15 GW of biomass.
Now, let us come to the topic of grid interface of renewable energy. If we can produce nuclear power through thorium which is abundantly available with us then we can generate nuclear power in abundance. Unfortunately this technology has not yet been utilised in its full capacity.
What are the major challenges that comes into play post production of nuclear power?
The first challenge is that we are still dependent on some other countries for the supply of uranium.
The way I see it, nuclear power will form large portion of renewable energy penetrating the Indian grid. As on date it is 310 GW in the grid. The biggest challenge is, if you allow penetration of renewable energy in the Indian grid, say 175 GW, there is no guarantee as to how much power will be available. You see that hydro power is only available for 3-4 months, as long as there is good monsoon and the dams have sufficient water for the production of electricity.

This key feature, when read with the rights of users of the power systems per various sections of the Electricity Act, 2003, transformed the ways of working of the sector, allowed for third-party network use, power trading and eventually organised trading platforms in the form of power exchanges in 2008. It also forced the expansion of the grid and its integrated operations through binding codes, especially the Indian Electricity Grid Code.
Shorn of the details, the Electricity Act, 2003 fundamentally permitted for two critical freedoms – the freedom to purchase and the freedom to sell electricity. These freedoms were backed by an entire set of provisions relating to the delicensing of generation, elimination of cross-subsidy surcharges, dedicated transmission lines, definition of a captive generating station, elimination of conflict of interest through ownership restrictions, etc., all underpinned by open access. The limitations imposed on transmission companies, in particular, were noteworthy since they are essentially the purveyors and guarantors of open access. Transmission companies were prohibited from trading in electricity.
It has often been argued that the progress in the implementation of the act has fallen well short of the objectives. It is tempting to conclude so, especially since many parts of the sector remain inefficient and unresponsive to consumer needs and also to independent regulation. The finances of the sector remain precarious despite several bailouts, tariff distortions are rife and service standards are blatantly violated or entirely ignored. However, such a conclusion would really undermine the gains made in the past two decades. The power system’s installed capacity base is much larger (5x today as compared to 1998) and much more robust now. The national transmission grid is amongst the largest frequency integrated grids in the world. The system allows for handling a large amount of renewable energy. The present renewable energy capacity in megawatt terms is larger than the entire electricity grid capacity in the year 2003. This is no mean feat since absorbing large amounts of intermittent renewable energy is an exceedingly challenging task. Over time, the competitive power markets have become larger and more sophisticated, with a vast variety of market-traded products. Indian power system operations are extremely well regarded across the world. The last major grid failure in India occurred in 2012. Frequency excursions, which used to be quite common, are a thing of the past, with grid frequencies now managed in a very narrow band.

Electricity Shortages and Diesel Substitutes
Because farmers do not pay for the electricity to pump water from the ground or from one river to another, the revenue of state utilities in Haryana, Punjab, and every other Indian state are perennially in deficit, relying on the national government for financial assistance.
Furthermore, the expansion and modernization of India’s national transmission grid is slow and uneven, say state power executives. Currently, India’s transmission grid wastes 25 percent of the energy it transports. In contrast, China’s transmission grid loses just 5 percent of the power it carries.
Not only are the funds funneling through the system inadequate, but the electricity itself is in such short supply that state utilities in this region and across much of the country set schedules for their customers. In Punjab, homes are supplied with electricity from late afternoon through the evening, as well as most mornings. Farmers, meanwhile, get power during the night and intermittently during the day. Power can — and often does — go out during an allotted time, however.
But there are ways to get around the electricity schedule, as well as any unscheduled electricity outages: intermittent power supply is so embedded in the Indian way of life that any farmer — or anybody else for that matter who can afford it — purchases and operates a diesel-fueled generator.
For instance, when the power goes off on Sekhon’s farm, diesel generators provide the electricity needed to run the irrigation pumps in the field. At his dinner table, the only subtle change is a slight dimming of the lights as the system seamlessly switches from state-provided electricity to at-home diesel generators.
The steadily growing number of generators reflects two market events:
- More people can afford them as middle class incomes rise.
- 40 percent of the $US 18 billion in annual energy subsidies that India provides for farmers, businesses, and drivers is devoted to reducing the price of diesel to well below market rates.
Petroleum consumption has climbed more than 40 percent since 2000 to 3.2 million barrels per day in 2012, 70 percent of which is imported, according to the International Energy Agency. More than 40 percent of India’s petroleum is consumed as diesel fuel, according to India’s Ministry of Energy.

Even 75 percent of families connected to grid power in rural areas – 700 million people – regularly get less than six hours of uninterrupted power a day, according to a 2016 study by the Delhi-based Centre for Science and Environment.
India's government aims to bring 500-megawatt mini-grid solar systems to about a fifth of the country's 1.3 billion people in the next five years, according to a government draft policy.
More than 230 million people in India still have no access to basic electricity, often in rural areas where expanding the national power grid is too expensive.
Expanding access to power aims to boost household incomes, help students study, provide better access to information via radio or television and generally improve life for rural people, studies have suggested.
But the Uttar Pradesh study – which looked at 1,281 households in 81 communities – found that providing about two hours of electricity in the evening via clean energy mini-grids resulted in few significant changes.
Many households continued to use subsidised kerosene for lighting after the mini-grid power shut off, said the study published in Science Advances magazine.
Electrification programs that focus on off-grid technologies must think carefully about whether low-cost minimal systems are the right answer, authors of the study said.
Clementine Chambon, co-founder of Oorja Solutions, which will begin setting up clean energy mini-grids systems in the Bahraich district of Uttar Pradesh in June, said she agreed that providing larger amounts of power to supply businesses, rather than just homes, could help solar systems pay for themselves more quickly – and could subsidise household use of power.
"Oorja will cross-subsidise residential consumers through higher electricity tariffs for businesses. This renders clean energy affordable to all, whilst ensuring the profitability of the mini-grid infrastructure," Chambon said.
India eventually aims to expand its grid power system throughout the country, but there will be five to 15 years while that is underway where other solutions – such as mini-grids – are needed, according to Ashvin Dayal, the Rockefeller Foundation's managing director for Asia.
Those are crucial years both for meeting world goals to extend clean electricity to communities without it and to curb climate-changing emissions in line with the Paris Agreement, which calls for fossil fuels to be phased out by the second half of the century.
The cost of producing solar power in India has plunged in recent months, hitting a level that makes it price competitive with fossil fuels, including coal, experts say.

The role of renewable energy (RE) needs to shift from just being important to being more relevant. For this to happen, RE generation must integrate with the scheduling requirements of distribution utilities. The infirm nature of RE makes it a grid-operator's nightmare. While consumers demand continuous power, RE can make this an impossibility. Thus, most utilities look at renewables as vendor-driven, expensive and infirm; it is power that has to be absorbed for obvious unholy reasons. With weather prediction models becoming more and more accurate, policy intervention must shift the premium from just adding solar and wind capacity to bringing about predictability and scheduling of RE and simultaneously facilitating its trading over shorter time slots. This would not only bring predictability, leading to better acceptance by distribution companies, but also create a new and niche market for RE.
It is time that the right to energy also becomes a reality. The Rajiv Gandhi Gramin Vidyutikaran Yojana (RGGVY) has to be recast to meet this need. This programme has the laudable target to provide electricity to the homes of the rural poor. But with electricity comes a bill, which even though very small, needs to be paid within a time limit. A family which has not seen electricity for 65 years since Independence suddenly gets connected to the grid followed by a bill. But the new user has no economic activity to generate the required cash. Disconnection follows and over time, the distribution system is stolen or wasted. The RGGVY must provide for payment of a minimum bill for first-time BPL (below the poverty line) electricity users.
Power sector reforms must now be driven by simple straight forward thinking based on ground realities with customer at the centre and full involvement of states rather than complicated, central driven initiatives.
(The writer is managing director of MSEDCL, Maharashtra's state electricity distribution utility, and has been on almost every committee dealing with power reforms)

India Inc. is losing millions of rupees in potential revenue every year because of power cuts, a new survey reveals.
The study, carried out by the Federation of Indian Chambers of Commerce and Industry, revealed that one in three industrial units suffer power cuts for more than 10 hours each week.
The report, released Monday, drew attention to coal shortage, to the failures of power distribution systems in various states, and to the common phenomenon of power theft, where people tap into power lines illegally.
The survey comes after, last summer, India suffered a massive power outage that affected as many as 680 million people, disrupting transport and businesses.
India has an installed generation capacity of 210 gigawatts that lags electricity demand by 10.6%. according to the Central Electricity Authority, the government agency that monitors the power sector. The country has plans to expand electricity generation capacity by 44% to 288 GW in the five year-period between April 2012 and March 2017 to supply uninterrupted power to millions of its households and power the industrial growth. But coal shortages and poor financial health of electricity distribution agencies stand in the way of the expansion goal.
The study says that Indian companies are losing up to 40,000 rupees ($733) a day each because of power shortages, which are taking a toll on production. The survey, which covers 650 industries of various sizes across India, said that as many as 61% of the companies surveyed suffered more than 10% loss in production due to power cuts. Most companies have power generators, which temper the effects of power cuts.
The study revealed differences between Indian states. Companies based in Gujarat, Karnataka and Maharashtra suffered far less from power cuts than companies based elsewhere.
In keeping with its business-friendly reputation, the study found Gujarat was the state where power cuts are least common. Gujarat undertook successive reforms including electricity tariff hikes that led to improvement of financial health of its electricity distribution companies, which in turn improved their ability to buy more power and also fund plans to modernize distribution networks.
Southern states of Andhra Pradesh and Tamil Nadu fared worst, with companies saying they suffer between 21 hours and 30 hours of power cuts every week, the report said. The states were followed by Orissa, Jharkhand and Madhya Pradesh, where the power supply situation is also poor.

According to 2013-14 figures, the total installed capacity for electricity generation in India registered a compound annual growth rate of 7%. However, as of 2015, 237 million people in India do not have access to electricity. The government’s National Solar Mission is playing an important role in the work towards renewable energy, and interventions in rural electrification and new ultra mega power projects are moving India towards achieving universal energy access.
Targets for Goal 7
By 2030, ensure universal access to affordable, reliable and modern energy services.
By 2030, increase substantially the share of renewable energy in the global energy mix.
By 2030, double the global rate of improvement in energy efficiency.
By 2030, enhance international co-operation to facilitate access to clean energy research and technology, including renewable energy, energy efficiency and advanced and cleaner fossil-fuel technology, and promote investment in energy infrastructure and clean energy technology.
By 2030, expand infrastructure and upgrade technology for supplying modern and sustainable energy services for all in developing countries, in particular least developed countries, small island developing states and land-locked developing countries, in accordance with their respective programmes of support.

As a growing economy, India not only just requires to light bulbs, but needs electricity to fuel the growth of every industry, be it large-scale or small scale, manufacturing, healthcare or education. All of this impacts the economic growth of the nation and it doesn't end here. It is one of those key components that facilitate our everyday life. In the current world it has a large impact on human life.
Toshiba has been contributing in many ways to provide power solutions in India. What have been the main focus areas and important breakthroughs in terms of performance in the power sector?
Our main focus is to provide turnkey Engineering, Manufacturing, Procurement, Construction and Services (EMPCS) solutions to the Indian power sector. Toshiba, with its highly-experienced manpower and energy-efficient and reliable power generation equipment, has been providing similar turnkey solutions across the globe for more than 60 years.
In the power sector, there are three main processes that are important: generation, transmission and storage and Toshiba has efficient solutions in all the three categories. Our manufacturing facility, Toshiba JSW Power Systems Private Limited in Chennai, focuses on manufacturing efficient power generation equipment. This plant is well-equipped and the employees are trained at Toshiba, Japan, to achieve the same level of quality standards as in Japan.
Toshiba is actively engaged in developing the reliability and quality standards of Indian raw material suppliers and other vendors. This initiative of Toshiba will ensure India's excellence in manufacturing sector over a period of time.
I am sure that in the coming years, we will provide 100 % indigenous power plant solutions from India not only for the Indian market but also for the rest of the world.
Do you think more private sector participation can help improve the situation? How can the government encourage corporates to provide large-scale solutions?
Installation of power plants requires huge investments. Participation of private sector will definitely make this investment proposal more competitive and ultimately benefit the consumers. From the government side, sustainable energy policies backed up by financial support, is required to promote the participation of private sector. State Electricity Boards are the main customers of private players in the power sector. To boost the morale of private players, economically-viable, timely and assured payment from state utilities to these private players is a must.
What kind of innovation and technology can contribute in overcoming the situation? In line with this, what would be the strategy and vision of Toshiba in the coming years?

This odd surplus – as dubious as it may be – is an inspiring story that started in 2003 when the Indian Parliament passed landmark legislation, replacing the old electricity Act. The new law allowed electricity trade, mandated open access and empowered the electricity regulator to develop an electricity market. Open access materialised on the main transmission grid in 2004 and traders began their work. Power exchanges were set up a few years later in 2007. This happened at a remarkable pace, unprecedented even in most rich countries.
India is so big and diverse in terms of weather that even in an overall shortage scenario there are states or regions with surplus energy, particularly in the East and the North-East. Open access makes the technical (and trickier) part of trading electrical energy relatively simple. The power trade started right in the midst of a nearly 10% energy shortage nationally, baffling the ministry of power.
One of the first energy trade transactions was between the eastern city of Kolkata and the northern state of Punjab over weekends when offices are closed in Kolkata and demand drops. Punjab went further in its quest and started buying power from late night to early morning. No bureaucratic intervention could have caused such an efficient allocation of resources, or could have convinced the business class to invest in generating plants on such a massive scale.
And when the rising prices in the short term electricity market caught the attention of the Indian business class, there was no looking back. Over the last decades, the generating capacity of India sky rocketed by a factor of ~3. Trade volumes in the open market have ballooned to a figure that is more than the total electricity requirement of Bangladesh, Nepal, and Sri Lanka put together.
(Hydro)Power knows no boundaries
Sitting atop the Himalayas, Nepal has massive hydro power potential. However Nepal has exploited less than 1% of its hydro potential, even though brownouts and blackouts are a regular feature of life in the country. At present, Nepal imports power from India through a dozen small cross-border links. Any further progress on strengthening these ties is typically addressed with a deep sense of suspicion. Arguments include: “India buys electricity cheaply from Bhutan and then the same electricity is sold to Bangladesh at double the price. But India doesn't allow Nepal access to sell electricity to Bangladesh.” The fact is that Nepal has no electricity to sell.

* Tamil Nadu unable to meet 31% peak demand for power during summer
* Tamil Nadu to add nearly 6,000 MW capacity to solve crisis
* States like Bihar & Punjab could be next to face power deficits
Power cuts are a part of life in most parts of India. And yet they can surprise, as it happened when the country’s northern grid faced a severe power cut on July 29, 2012 and 7 states were crippled due to shortage.
A few weeks later, IndiaSpend drew up a short report on the power dynamics across the country, and hazarded that southern India was probably the next in line to see large scale cuts because of rising demand-supply gaps.
Last month it happened. The southern Indian state of Tamil Nadu, especially its western and southern districts, saw power cuts that lasted between 10-20 hours a day as supply failed to keep pace with high demand. The situation may stabilise as some fresh capacity comes in but it might take another three months.
Tamil Nadu appears to be a case of a state which may have been better prepared. The Tamil Nadu Generation and Distribution Corporation (TANGEDCO) – set up in 1957 to run the power transmission and distribution in the state – had proposed new power generation capacity of 5,988 MW during the next five years.
They included three thermal power projects scheduled for commissioning by April-June 2013 and eight hydro power projects of which four are scheduled to be operational by November 2013.
Tamil Nadu presently has a 330 MW gap during peak demand, which is the highest amount of electricity consumed at any point of time. And summers usually see demand peaks in India. Not surprisingly, Tamil Nadu has been seeing power deficits rise during peak demand in the last few years as the following table shows:
Evidently, the power deficit during peak zoomed again after 2010. And much faster than the previous peaks in 2007 and 2008. If the data is accurate, it would suggest that fresh capacity has been keeping pace, somewhat. Or demand has been slipping. More likely the former.
That’s the quick story of Tamil Nadu. Many other states in India don’t come close in preparedness. Bihar and Punjab look like prime candidates. As do the North-Eastern states.

S.K. Soonee, Former and Founder CEO, Power System Operation Corporation Limited (POSOCO), spoke at length on the inevitable changes, challenges and outlook for the electricity grid at Power Line’s 15th Annual Conference on “Power Transmission in India,” held in Gurugram recently. Excerpts from his address…
Challenges in grid operations
The ongoing energy transition is bound to impact transmission, as well as system operations. With the electrification of various segments such as transport and cooking, the system operation would change too. Three major changes are taking place in the transmission segment. Firstly, transmission access, planning and pricing are moving from Kirchhoff’s Current Law to Kirchhoff’s Voltage Law. This essentially implies that point-to-point transmission would be replaced, and the grid would become a common carrier with general network access and point of connection access and tariff. This is a paradigm shift.
Secondly, the value of transmission has until now been mainly restricted to transmitting power and certain important attributes related to the transmission grid, namely, reliability, resilience, inertia, access to market and risk mitigation, etc. remained latent. All these aspects have important roles in transmission, and have to be valued. However, with energy transition, these aspects will become more important than ever before because we will have non-tameable generation (wind and solar) and even the load profile will change (electric vehicle charging, induction heaters for cooking, etc.).
The third change is on the transmission planning front, where integrated resource planning will be required. The transmission planner would have to forecast the import and export capability of every state using various probabilistic approaches. States have their own load generation balances and portfolios, and import/export, and this needs to be pushed to the limits. It is important to determine the degree of imports needed by a state to meet its power demand. States with less load need to determine if they will be able to evacuate their entire internal generation. It is also important to take a call on what import-export capability a state would like to plan as a policy. With respect to market-based economic despatch, cheaper power would replace costly power until the marginal cost becomes the same, or MBED discovers transmission congestion. Overall, transmission planning will become extremely important to integrate renewables.
At present, there is a challenge with respect to institutional development of power system planning as a faculty.

There is scope to use both, mandatory and voluntary standards, the latter being reinforced by public opinion combined with appropriate tax incentives.
Given the importance of energy conservation, there is a need to focus on technological options for improving energy efficiency in the industry, power generation and commercial buildings, and promoting renewable energy technologies in different end-use sectors. There is need to introduce efficient high-end power turbines and generators.
SOLUTIONS NEEDED IN INDIA FOR A BETTER SOCIETY
There is a need for alternate energy which will not only offset the demand of conventional fossil fuel, but also pave way to cleaner solutions A green growth economy is the need of the hour. Ironically, India has world's fifth largest coal reserves and still faces acute power crisis. India's per capita power sector consumption, around 940 kilo watt-hour (kWh), is among the lowest in the world. In comparison, China has a per capita consumption of 4,000 kWh, with the developed countries averaging around 15,000 kWh of per capita consumption.
But the good news is that a massive overhaul of the power sector is underway with the government planning to bring in a series of amendments. For instance, there will be changes to the Electricity Act of 2003 across all segments of the power value chain within the current session of Parliament.
The Union Cabinet had in November approved the launch of Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) for ensuring 24x7 power supply. The Rs.43,033-crore scheme would separate agriculture and non-agriculture feeders, facilitate judicious fostering of supply to agricultural and non-agricultural consumers in rural areas, and strengthen sub-transmission and distribution infrastructure in rural areas, including metering of distribution transformers/feeders/consumers.
Coal sector will soon open up for private sector, bringing in more organization and competitiveness in the sector. Private companies are already allowed to mine supplies for their own power plants and other industrial projects, and Coal India hires some private firms to operate mines. But until now private companies have not been permitted to sell coal. However, there is no move to fully privatize Coal India.
Insufficient fuel was a chief concern of the industry. But during April 2014 to October 2014, there has been a growth of 15.4% in coalbased power generation over the corresponding period of last year.

BHEL gets a major chunk of the orders, and the rest is shared by others but the volume is yet not that meaningful," Agrawala said.
GE Asia's head said that India needs to fix problems in power sector to attract foreign debt and capital because the local funds are not enough to add the capacity needed by the country.
"The balance sheets of most companies in the sector would not be able to support substantial capacity addition that is needed in the sector. We are short of equity as well as debt," he said.
India needs to provide a legal, regulatory, and risk-return framework that attracts foreign investment, he said. Despite 100% foreign direct investment allowed in India, most overseas energy companies have shied away from the country due to the challenges they faced here.
"It's absolutely critical to get the electricity distribution business fixed by addressing the issue of huge subsidies and the existing losses of discoms squarely. It has reached a point that the losses are untenable," he said.
Agrawala said that India needs to make a long-term energy plan that is sustainable and balanced.
"The faster we realise that we as a country are short of primary energy sources and therefore we need all the energy sources, the better it will be."

A good example is ABB’s 800 KW Northeast-Agra UHVDC project, which brings clean hydropower from the Northeast to Agra, covering 1,728 km and providing electricity to 90 million people.
“It is all about setting up green energy corridors across the country so that clean energy from power surplus states can be brought to the power deficit states,” adds Sharma. He cites the example of another ABB project—the 1,830 km long UHVDC Raigarh to Pulugar link—which will integrate thermal and wind energy and provide power to 80 million people in high consumption areas located thousands of kilometres away. When the wind strength is low in the south, the power deficit will be made up by the northern states by providing thermal power through a two-way link; when there is excess wind power, the south will give clean energy to the north.
Storage, too, should not pose a major challenge. Excess power can either be stored in batteries or in “pump storage”, or more simply stored in water. With battery costs still high, pump storage could be a viable alternative for India. In pump storage, the surplus power during the day is used to lift water to a certain height in reservoirs or dams within or outside the country to generate kinetic energy. In the night, the water is allowed to flow down, converted into electricity, and sent back to the power deficit areas.
But what excites the ABB president most is India’s accelerated drive towards an electric vehicle (EV) revolution. The company, he points out, offers the entire bandwidth of technologies to enable sustainable transport—from grid integration to transport of renewable energy to the fast charging of cars in record time. Many states like Karnataka, Maharashtra, and Andhra Pradesh have rolled out their EV plans and this provides a huge opportunity for ABB, he says.
“We took a decision to take electric mobility as a business opportunity very seriously in 2011 and today we are the global market leader in fast charging,” says the man who started the e-mobility charging infrastructure initiative in a garage in the Netherlands with a startup.
That he means business was evident when he showcased a 350 KW charging station that can charge a car in eight minutes—enough to travel 200 km—at the recent Mobility Summit in New Delhi. Connecting the fast charging stations to the cloud can also bring in additional benefits like allowing people to make cashless payments, etc.

The total installed capacity for electricity generation was 2,66,387 MW in March 2013, but distributing electricity at the retail level at affordable and reasonable prices is still a nightmare. Secondly, the regulatory framework for the electricity business needs strengthening. Loss in distribution is a worrisome factor and sadly efforts being taken to bring down losses are not encouraging. The new government must invest in this field, which may involve rationalising tariff and incentivising reduction of losses.
Renewable energy generation has a potential of 89,774 MW, with Gujarat having the highest potential. Unfortunately, the country does not have any existing Renewable energy Law. Renewable energy comprises 60 per cent of electricity and 40 per cent of other sectors. Climate change is a global issue, warranting the new government to implement a Renewable Energy Law, that would make it mandatory for all conventional energy users to use a certain percentage of renewable energy. This process has started in electricity, but needs strict implementation across all segments.
Merely levying a carbon tax on imported coal will not yield sufficient results. Renewable energy comprises solar, wind and biomass. Wind power accounted for the highest capacity of total installed renewable power at 69.65 per cent, with small hydropower coming second at 13.64 per cent and biomass power at 12.58 per cent.
The new government must aggressively work on energy as the main agenda. We should have an energy commission for formulating synchronous policies with other inter and intra ministerial departments. States must also be taken into confidence. Progress of the energy sector will provide mindboggling opportunities for employment and socio-economic growth, besides raising the standard of living in the country.
(Suresh Prabhu is former Union Minister for Power.)

However, with developers being reluctant to absorb the high cost for retrofitting their projects to meet the new standards (around Rs 1 crore or $1.56 million per megawatt), the government is likely to push the deadline for compliance to December 2019. Lack of affordable technology is one of the principal reasons for the high cost and thereby the associated reluctance in compliance.
The NEP makes broad recommendations on how India should work towards developing and acquiring technology needed for advancing the energy sector. However, the policy does not recommend consistent and strong policy and budgetary support for technology development, as in China. Despite China’s success, and India’s growing reliance on Chinese imports to drive its clean energy revolution, not enough urgency has been expressed in the NEP to make India’s energy future in India.
Grid versus off-grid
The NEP prescribes grid-based supply to all households to be India’s primary endeavour, with renewable energy implemented to address the access issue only in cases where grid power is unavailable. The NITI Aayog in this instance has used the term renewable energy interchangeably with decentralised renewable energy. A rationale for this position has not been indicated, even as the government continues to promote decentralised electrification programmes.
The position to promote grid based electrification continues to mystify as a significant percentage of grid connected households do not meet an adequate level of electricity access. This was validated by the Council on Energy, Environment and Water’s ACCESS study focusing on the state of energy access in six of India’s most energy deprived states. The study found that though 96% of the villages were considered electrified, with 69% of all surveyed households having an electricity connection, only 37% had any meaningful level of electricity access. Rather than promoting a particular means of electrification, the NEP could encourage context-specific electrification approaches, by considering economic viability, consumer demand and aspiration, affordability, as well as reliable provision of electricity.
As India’s importance and role in the global energy markets continues to grow, it needs to be strategic in its energy planning. To build on the successes of the recent past, such as record low tariffs, increased investment flows into the energy sector, successful introduction of auction-based bidding for wind projects and others, it cannot afford to lose momentum with policy uncertainty and unclear energy pathways.

Wind Power has been the fastest growing segment in the entire power sector as well as within the renewable energies in the country. Today, we have nearly 15000 MW of installed capacity in which apart from a few odd megawatts, the entire capacity has come up through private sector investments. A few years back, India ranked III and IV on the world map of wind power installations till China took over rather rapidly. While government owned Center for Wind Energy Technology (C-WET) has continued to claim that India has only 45,000 MW of wind power potential, the reality is that several studies carried out by independent agencies and experts indicate that the potential is of the order of several thousand gigawatts and not megawatts ( a scale difference). Since the establishment of Feed-in-Tariffs first by Maharashtra Electricity Commission (MERC) in 2004 and later by most of the other State Electricity Regulatory Commissions (SERCs), countrywide wind power development has been taking place in a more or less sustainable manner. In this backdrop, if we look at what’s happening in the mainstream power sector, we find chronic shortages that have not been addressed, power cuts, shut downs lack of electricity to both rural and urban areas having the greatest impact industrial production. At the time of writing this article, the country faces a major crisis in coal supply and it cannot be conclusively said if this is a short-term crisis or a manifestation of the long term shortage of coal resources. Because of these shortages, already there is a huge investment that has taken place in back-up systems across the country in domestic, agricultural, commercial and industrial segments. Establishments resort to costly diesel generation while households have invested in inverters. The very important and significant point we make here is that the rationale of low cost of power does not hold, when there is no power to supply. Enabling investments and creation of generation capacity should have priority over issues such as competitive bidding. There is no doubt that the electricity demand is increasing and the country has limited options to meet this challenge in a sustainable manner. This very important point we think is being missed by the policy maker. With this overview we return to the issue of competitive bidding in wind energy. We have noted that wind energy is one of the segments of energy sector that continues to attract investments in the current policy and regulatory regime and a capacity of more than 1000 MW gets established every year.

Governments promise more power plants, this many thousand megawatts by such and such year. But nobody wants to tell you that while there is a shortfall, it isn't really so much as to completely blight our lives. The problem is, it costs money to produce power, and we, the people, are not willing to pay for it.
My colleague, India Today (Hindi) Editor Anshuman Tiwari, points me to a bunch of data on the surprising realities of India's self-inflicted power crisis. A July 2014 report of the Central Electricity Authority (http://goo.gl/XjFDdN) gives us some interesting facts. Would you believe, for example, that India's overall power shortage for that month was just 3.6 per cent, going up to 3.9 per cent at peak time? In the north, the shortage is 5.8 per cent and in the west and the east a mere 0.9 and 1.7 per cent, respectively, even at peak demand.
Then how does this add up to such a grave crisis?
It's because, first, we are not charged the correct price for power- too many of us, particularly farmers, pay almost nothing. And even when we are, we find ways to not pay. As a result, most of our distribution companies owned by state governments are broke, some as bad as KESCO, many worse. They have no money to buy power, which is now freely traded, or to upgrade distribution infrastructure. And if the head of one of them tries seriously to collect, a fate like Maheshwari's lies ahead. Our power crisis becomes much, much worse than it should be because of our subsidy and free-booting culture and our government's inability to collect its own dues. Because if power distribution was such a bad business, how come all the privately owned utilities, CESC, BSES, etc, are making robust profits?
The CEA report also has a section that gives you data under that dreaded head, T&D losses. In old-fashioned English, it stands for transmission and distribution losses. But ask anybody in the power sector, and they use a more fitting description: theft and dacoity losses. The report gives us figures for 2010-11 and 2011-12 and their losses stand at 23.97 per cent and 23.65 per cent, respectively.

By: Prof. S. D. Jawale (email@example.com)
Date: 22nd Sept 2021
Rapid growth of India’s economy is supplemented by the development of Indian energy and power sector. The power sector in India has made incredible progress in last few decades. The total installed capacity has increased to more than 350 GW in 2021 and the transmission & distribution network has increased from small residential and industrial areas to form National Grid. However, the supply of electricity has always been lagging behind the demand. The electricity has a key role to play in progress of the nation and in order to enhance the development of power system; Indian government has started various organizations e.g. Power Grid Corporation Limited (PGCL), National Thermal Power Corporation (NTPC), National Hydro-Electric Power Corporation (NHPC) and State Electricity Boards (SEB) etc. However, still the India is not fulfilling power or demand to the new upcoming power network.
Highlights of Indian power sector:
Now, the power sector in India is going through a rapid change in terms of the technology, and we cannot deny the change that technology has brought to both the power sector and our lives. We see the adoption of Internet of Things (IoT), Artificial Intelligence (AI), and Big data in advancing the development of power sector. We witnessed this technology advancement when The Hon’ble Prime Minister of India appealed to the citizens on 3rd April 2020 to switch off their lighting system at 9 pm on 5th April 2020 for 9 minutes. Then Power System Operation Corporation Limited (POSOCO) with the use of technology handled situation very efficiently as the anticipated reduction in all India demand during this period of 9 minutes was around 12000 – 14000MW which may cause fear of Grid failure by cascade tripping.
Electrical Engineering department of Jawaharlal Nehru Engineering College (JNEC) has maintained the pace with this technological advancement of power sectors. New courses in are included in the engineering curriculum that will update the students with these technological advancements. For instance, concepts such as digitization of power plants which fundamentally means combining technology such as IoT (Internet of Things), AI (Artificial Intelligence) and Big Data with advanced hardware to deliver reliability, affordability and sustainability are core part of the newly designed curriculum.

New Delhi, Jun 27 (UNI) The government today said Rs ten lakh crore will have to be invested to increase electricity generation in the country by 78,000 MW over the next four to five years.
Terming it as a challenge, Power Minister Sushilkumar Shinde said finding institutions, companies, project manager, workmen and vendors who will deliver all this phenomenal work in the required time frame was also daunting task ahead.
''Improving distribution will involve a lot more investment than in the past, coupled with a lot of technology inputs on a massive scale,'' he, said while inaugurating 'India Electricity 2007' conference.
The Minister said that there is a need to include central and state Public Sector Undertakings, Indian and foreign investors, equipment suppliers and financiers.
''It is not enough only to generate more power. We have to ensure that the current high levels of Aggregate Technical and Commercial losses come down to 15 per cent in the next few years so that we derive full benefits of the stupendous capacity addition efforts.'' The entire value chain in the generation and consumption of electricity starting from coal extraction right down to the more efficient use of energy needed to be constantly geared up and streamlined to make them more productive and efficient, he said.
Currently the government is trying to overcome current shortages of about 13,717 MW or 13 per cent of the country's requirement and increase generating capacity by ten per cent.
All major stakeholders from the power sector, including senior officials from utilities, independent power producers, regulators, investment bankers were participating in the meet.
The conference was jointly organised by FICCI and the power ministry.

International Solar Alliance (ISA) is a partner organisation to India’s G20 Presidency for 2023 and, as part of its deliberation on energy transition, published a report on July 20 this year which says that around 59% of the unelectrified population can be best suited for electrification through solar-powered mini-grids.
Debajit Palit, a professor of energy at NTPC School of Business, told Mongabay-India that in numerous African countries, extending transmission lines to remote regions incurs significant expenses. Opting for local generation through mini-grids close to the demand proves far more cost-effective than extending transmission lines.
He said that the mini-grid concept could offer a superior solution for India too, where decentralisation is gaining traction driven by the need for decarbonisation and further fuelled by the adoption of digital technologies. This shift makes mini-grids, espeically inter-connected with grids, a viable choice, not only for rural areas but, potentially, even more advantageous for urban set-ups.
India currently leads the list of countries with planned mini-grids – those that developers, governments and other organisations have said they plan to build over the next several years. India’s plans to install 18,900 mini-grids, followed by Nigeria (2,700), Tanzania (1,500), Senegal (1,200) and Ethiopia (600).
However, to meet SDG 7, the world will have to power 490 million people through the construction of more than 217,000 mini-grids. At the current pace, only 44,800 new mini-grids serving 80 million people will be built by 2030, says the World Bank report.
Private sector mini-grids are facing challenges. A paper published in Energy Research and Social Science underlines the conflict between customer affordability and business viability of private mini-grids. Lead author and energy expert Venkata Bandi identifies grid expansion, policy gaps for off-grid, consumer reluctance to pay, and entrepreneurial apathy as the main challenges. “Capital costs are often sunk costs,” he says while responding Mongabay India’s queries.
Government mini-grids too are performing poorly, with a majority of them not functioning, as reported in a recent media article, based on inputs it received from Smart Power India.
Additionally, India’s electricity sector has some unique regulatory challenges with regards to mini-grids, according to Debajit Palit.

They, including the latest one, have been like band-aid on gangrene, merely kicking the can down the road. It also did not help the discoms that the share of purchases from state government generators (Gencos), whose dues could often be rolled-over, declined and that from independent power producers rose.
Compounding the problem, political considerations meant that tariff increases were mostly off-table. In fact, in many states, household tariffs remained unchanged for years, sometimes nearly a decade. With raising tariffs for household and farm consumers a no-go, discoms relied on industrial and commercial consumers to bear the brunt of tariff increases. An inverted tariff structure emerged, whereby industrial tariffs rose to become much higher than household tariffs. Already struggling with power cuts and poor quality of supply, the tariff inversion only added to problem of industrial competitiveness.
As a result of all these, the objective of discoms degenerated into mere provision of power during the scheduled supply timings and avoid unscheduled interruptions. In the rural areas, it meant limiting to basic lighting supply during the night (which was also generally the time for farm supply). Since farm supply did not fetch any revenues and the supply on most rural feeders was very small (as a share of the total supply), the discom anyways had limited incentive to carry out maintenance works on rural distribution network and focus on the quality of supply. For the discoms, rural supply was nothing more than a necessary evil.
In fact, the need to limit farm usage beyond the period stipulated under the respective state’s free-farm power policy (typically 7-10 hours varying across states) meant that discoms restricted to single-phase supply after that period. This effectively meant that economic activities that required the use of motors etc became prohibitive. Such enterprises had to draw three-phase lines directly from the 33/11 kV substation, a very expensive proposition, often comparable to the capex required for the business itself. While states tried to overcome this by segregating agriculture feeders, its high capital investments and practical challenges (not to speak of higher technical losses due to additional network) meant that this has had limited coverage.
All these had the discoms incentives accordingly aligned. Struggling with a hand-to-mouth existence, the discoms had limited incentive or resources to invest in maintenance of the distribution network.

We are yet to start the implementation of part B. For part B, the tendering process is underway and once the tendering process is complete, we will be able to start the implementation part. The total project cost under part B for Dakshin Haryana is around Rs 387 crore and tenders are likely to get awarded in the month of June.
Meanwhile, the Central government last year has come out with integrated power development scheme (IPDS). How many circles have been considered and what sort of opportunity will be there for private players?
Under IPDS we have already submitted need assessment documents to the Ministry of Power.
Since it is at initial stage, I will not be able to reveal much information about it. But the main emphasis is on strengthening of distribution infrastructure. Importantly, the need assessment document study is based on the priority of SEBs where they want to implement distribution infrastructure at priority level. It means, in the submitted documents there are circles or towns where the requirement of distribution infrastructure is more than any other town.
According to you what are the challenges a state government must be facing while implementing such an ambitious programme?
The underlying challenge while implementing IT infrastructure under part A is GIS mapping.
The GIS mapping includes online availability of entire network and assets (graphical view), geo-reference each asset, unique identity to each asset, identifying location of the consumer form, unique pole ID, network management and online tracking of changes in the network.
Since the GIS is backbone of working out the exact AT&C losses and it also requires integration, the implementation takes lot of time in terms of completion and building up of a reliable and acute data model.
Second challenge is the implementation of DT metering system in terms of maintaining. Because distribution transformers are all set up in the filed areas so you can focus the AMR for high value consumer as well as for the feeder. But in order to maintain the continuity of data from the DT metering system which creates a micro data is a tough task. The third challenge is capacity of people understanding the system integration. It means, we are currently facing the skilled manpower crunch of those who understand the entire IT infrastructure for power.
The only constrained about this programme is that it has not been able to complete in the defined timeline hence; every utility has made a proactive approach to the PFC and MoP seeking extension in the timeline.

Furthermore, the liberalisation of the electricity market in India has led to an increase in electricity trading. Short-term trading activities and the associated transmission of electricity over long distances represent an additional challenge for the grid. Due to the nature of the changes, the grid needs to be partially reinvented and automated. Grid intelligence and communication is required for grid operation to meet the requirements of the transforming energy sector. Nevertheless, data measurements from various places and various levels in the grid are necessary to enable the utilities to monitor everything that happens on a real time basis (or to start with, on a daily, hourly or quarterly basis). The utilities then can take actions more accurately, effectively and swiftly, improving the energy services. Electricity grid is shown in the picture.
Present State of Grid Automation
Developed countries have already automated their complete power supply system and their grids are remotely controlled. On the other hand, even after having edge in IT skill, India is way behind in automation. What to talk of existing grid network automation, even the new grids (especially, by states) are being constructed with old and outdated technology without any intervention of automation. Centre Government’s initiative of providing funds for automation & improvement under ARPDC scheme are either unutilized or are invested haphazardly in IT that resulted in issues such as:
• Stand-alone systems-Coverage to limited geographical areas
• Inadequate interface and integration with other applications
• Absence of a standard architecture
• High cost of maintenance
• Basic operations are still manual without inbuilt controls
These issues have adversely affected the returns from IT investments. Incoherent technology strategy leads to situations where incompatible options are selected and large sums of money are wasted in attempts to integrate them. The bottom line is that the business performance has not improved. Power sector expenses and revenue yield is depicted in Fig. 1:
Evidently, fundamental changes are required in the working of the power sector entities. Information Technology (IT) would become the key enabler in the initiatives under the reform process initiated by Government of India. This will enable substantial improvement in the overall health of the utilities.
It is absolutely clear that all the grid substations can’t be automated in all power sector utilities in one go because of the enormous magnitude of the effort and investment required. The approach, therefore, should be to give priority to generation and extra-high voltage level grids, especially, those linking inter-state power systems.

Going forward, this landmark progress could result in a significant overhaul of the power sector, encompassing deregulation, decentralisation and efficient price discovery. Policy interventions in the form of renewable purchase obligations (RPO) for DISCOMs, accelerated depreciation benefits and fiscal incentives such as viability gap funding and interest rate subvention will have to go through a rethink/need review. Reforming retail distribution of electricity while reducing commercial, technical and transmission losses remains a key challenge. The end of cross subsidisation by industry for other sectors, and closing the gap between average cost of supply (ACS) and average revenue realised (ARR) will require speedier/accelerated DISCOM reforms (including privatisation and competition). A nationwide Grid integration that can take supply from renewable sources as and when generated is needed to take care of daily/seasonal peaks and troughs associated with renewable sources. These dynamic shifts in renewables could help increase India’s per capita electricity consumption, currently among the lowest in the world. Here too, Indian industry has a crucial role to play.
III. Leveraging Information and Communication Technology (ICT) and Start-ups to Power Growth
11. Information and communication technology (ICT) has been an engine of India’s economic progress for more than two decades now. Last year, the ICT industry accounted for about 8 per cent of country’s GDP and was the largest private sector job creator across both urban and rural areas. In 2019-20, software exports at US$ 93 billion contributed 44 per cent of India’s total services exports and financed 51 per cent of India’s merchandise trade deficit during the last five years.
12. These headline numbers, however, understate the contribution of the sector to the economy. IT has revolutionised work processes across sectors and has generated productivity gains all around. The ICT revolution has placed India on the global map as a competent, reliable, and low-cost supplier of knowledge-based solutions. Indian IT firms are now at the forefront of developing applications using artificial intelligence (AI), machine learning (ML), robotics, and blockchain technology. This has also helped to strengthen India’s position as an innovation hub, with several start-ups attaining unicorn status (USD 1 billion valuation). India added 7 new unicorns in 2019, taking the total count to 24, the third largest in the world1.
13.

With its vision document, Vision 2024, India’s Ministry of Power is charting a way forward for the country’s power sector. And a central part of this vision involves the private sector. The Need for Private Sector Participation in India’s Electricity Distribution Sector explains how shifting focus to increasing private sector participation and investments in India’s energy distribution business could lead to improved financial viability and sustainability. You’ll learn:
- The seven goals outlined in the Vision 2024 document.
- The issues inhibiting competition in India’s power sector.
- The international precedents India could customize for its needs.
Download the paper to explore the possible roadmap India could take to involving the private sector in national power distribution.

State-owned NTPC is India’s largest power utility. It runs many plants below full capacity: its average is around 80%, but in some plants, it dips to as low as 60% capacity utilisation.
If the electricity sector was functioning efficiently, this would be impossible to explain: after all, when people are willing to buy power, why would any seller refuse? The trouble is that NTPC, and other power generators, cannot find reliable, financially solvent buyers of electricity.
Most of the power is bought by state governments, through state electricity boards (SEBs). These boards are bankrupt. In 2007, all SEBs put together made losses of Rs 26,000 crore; by March last year, this jumped to a staggering Rs 93,000 crore. Just two SEBs, Uttar Pradesh and Jammu & Kashmir, account for nearly half this amount.
To cover power purchase costs, the SEBs borrow money. Today, the total short-term debt of all the SEBs has soared to a mind-boggling 2,00,000 crore. Many states would buy as little electricity as possible, to avoid going deeper into the red.
Recently, the tap of cheap loans was turned off, and many states agreed to partially reform their SEBs. They hiked the price of power between 20% and 40% across the country. This can be the beginning of meaningful reform, not the end.
The government has a plan to restructure the debt of SEBs: the banks will not ask for half the debt for the next three years. For the other half, the SEBs will issue bonds to the banks, which will convert to equity over time.
This will require SEBs to become corporate entities, like the utilities in Delhi. These things will make SEBs temporarily solvent, but will not solve the underlying problem. This is political: members of all parties promise free or nearly-free electricity to people in return for votes.
Unlike most election promises, which are soon forgotten, they actually deliver on this one. Tamil Nadu once had a financially-healthy SEB, but five years of near-free electricity under the DMK completely destroyed its finances.
After coming to power last year, chief minister Jayalalithaa has hiked power charges, and her regime might see the SEB come back to health. But don’t hold your breath.

The world press took alarmed notice at those rendered powerless by the blackout, noting breathlessly that 600 million Indians – nearly a tenth of the world’s people – were without power. As electricity service is restored, the media spotlight is already shifting elsewhere, and India will carry on as a country where several hundred million people (I’ve seen figures ranging from 300 million to 450 million) live in homes with no electricity. Ever.
Which brings us to the enormous cleantech opportunity lurking in the shadows of India’s shaky grid. It’s one akin to what just happened to Indian telecommunications. When I was living in India in 1999, we heard many stories of multiyear waits for new landlines, which are zealously controlled by the monument to stasis that is India’s state-owned telephone company. Mobile phones were nonexistent. For the vast majority of Indians, telecom was a rare and complicated affair that occurred only on public-access phones at retail kiosks. (I can report that in those days you would overhear the most extraordinary things being bellowed down creaky old telephone wires as you passed by.)
And today, barely a decade later? There are more than 900 million mobile phone accounts in India, and there’s a whole electricity-biz sideline in providing recharging services to the millions of Indians who have mobile phones but no power outlets. India basically skipped twentieth-century telecom.
While India’s grid was down, it was distributed power generation – little diesel generators like the one my old guest house had, as well as the huge generators that Indian businesses routinely include in their office and factory designs – that kept the country from grinding completely to a halt. Gigaom reports that Indian companies pay more than $0.45 per kilowatt hour for that emergency power, more than four times the standard rate.
The conventional wisdom – as expressed over at The New York Times’ Dot Earth blog, among other places – is that only coal can possibly fill that gap. I’d suggest, however, that when power’s going for rates similar to the steepest of the world’s feed-in tariffs for renewable energy, we’re looking at the world’s most underserved solar market.
This is already well-understood in some corners of India.

Our investments in AMI (advanced metering infrastructure) started way back in 2005 and we have already deployed a state-of-the-art SCADA (supervisory control and data acquisition), GIS (geographic information system), OMS (outage management system) and ERP (enterprise resource planning) systems, which are well integrated with all of our current operations.
Reliance Infrastructure understood the need for a smart grid at a time when these concepts were unheard of in the country. This has helped us stay ahead of the curve in the smart grid sector. Starting in 2005, our company had deployed close to a quarter million units of automated meter reading modems (AMR modems) & MDAS system for its premium, high value and LT consumers & for other utilities under the RAPDRP programme for customers like MSEDCL, JVVNL, JDVVNL, AVVNL, etc. Use of real time SCADA/DMS (distribution management system) interface with GIS has resulted in a 60% reduction in power interruption time and better power quality. We also have OMS which reflects the outage areas in GIS and ensures faster response time for complaints.
What are the challenges to smart grid adoption in India
The smart grid can be described as the merging of two networks:
The power network, which consists of the generation, transmission, and distribution grid; and
The modern communications network.
The first step is to understand the smart grid communications network as a truly integrated network, rather than as parts of separate, vertically integrated application silos. This parallels the evolution of enterprise and telecommunications networks over the last 20 or 30 years into a single, integrated voice/video/ data network.
Traditionally, wired communication systems offered a reliable method for data transmission. However, with most substations remotely located, operators come across many communication challenges. Wireless technologies such as public cellular networks or standards-based technology for private networks (WiMAX, Wi-Fi) can be faster and less costly to deploy.
Due to such advantages, these technologies will increasingly find more and more takers and help the power sector step into the next orbit of operational excellence.
Tell us about the potential of India to tap green power for consumption
Green energy is certainly the future of power, and world over efforts are being made to make it an integral part of government policy road maps. The government has set the green power target 10% by 2015. The state regulators have started implementing it proactively.

It must however be noted that there are obvious overlaps between the functions of the CERC and the CEA and this led to the suggested merger of both agencies. However, the Ministry of Power (MoP) opposed this merger. This continues to remain a concern for stakeholders.
On the other hand, the SERC is vested with the powers to regulate intra-state generation, transmission and distribution in India(including those of the State Load Despatch Center [SLDC]), and to determine bulk and retail tariffs to be charged to electricity consumers. SERC’s advisory functions include, promoting competition, efficiency and economy in the activities of electricity industry in the state and reorganizing as well as restructuring of the electricity industry in the state. SERC’s activities are to be guided by the principles of tariff determination as specified by CERC
It is important to state that the consumers of electricity in India are statutorily protected from any adverse policies of the regulators. Thus, members of the public who are not satisfied with the operations of the CERC or the SERC can channel their grievances to the Appellate Tribunal within 45 days of the issuance of any such operational directives. The Tribunal has the authority to overrule or amend such directives. Appeals against the Tribunal can lie before the Supreme Court within 65 days of the delivering of such decision(s) by the Tribunal.
2.0 The Power Sector Reforms in India
2.1 Fragmented Privatization
The era of government regulated and vertically –integrated power sector has been relaxed in most countries, either completely (by way of 100% privatization of state enterprise and liberation of the markets for infrastructural industry services) or partially (by way of fragmented privatization). In the case of India, the model adopted seems to tilt towards fragmented privatization, especially considering the fact that it is a socialist economy. The monopolistic nature of the industry was diluted with the introduction of the economic policy in 1991. It would be recalled that the 1991 reformatory model was predicated on private management and capital generation. However, in 1996, the government policy reform was extended beyond financing strategies to the introduction of competition to efficacy target in the power sector.
Specifically at the state levels, the unbundling and privatization of the power sector in India started with the State of Orissa in the mid ‘90s.

Electricity distribution companies owned by state governments in India are paying for surplus power that they do not use. This has a significant impact on their finances, as a previous article explained.
How did surplus power become such a major problem?
Surplus power could arise due to a fall in demand, or increase in power supply. Insights from various states show that the burgeoning surplus is more due to the increase in power generation capacity. Read More…
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A crucial discussion paper by CERC, the electricity regulator, has, verily, made economics stand on it's head! Incentives and economic signals seem to be downright lacking in the proposed design for a wholesale, pan-India market for electric power.
Given that such a market would cut down on costs and boost efficiency across the board in the fault-prone power sector, the lacuna seems glaring indeed.
The issue at hand is a market for transmission capacity. The key really is "open access", the assurance of carrying capacity to transmit power cross-country. With open access, efficient power producers can compete for custom.
It's essential for reform. The Electricity Act, 2003 does provide the necessary enabling environment for open access. But the problem is that for long years we have thoroughly underinvested in transmission.
Line capacity is woefully inadequate and is likely to remain so for years on end. Hence the compelling need for a system of pricing and tariffs for transmission assets.
The idea, of course, is that proper price signals would induce better utilisation of scarce assets, and boost investment as well. Open access (at the right price!) would lead to a "seamless" wholesale power market.

The key drawback of solar energy market is the availability of lower cost alternatives in China which manufactures 8-10% cheaper modules than India. This has caused a huge dependency on imports of solar panels has hindered domestic manufacturing which be affect the market growth.
There was a 36% decrease in solar power capacity reductions during 2021 which fell by 36% as compared to 2020. This is largely attributed to supply chain disruptions, logistical restrictions, and construction delays during the pandemic lockdowns. However, despite these roadblocks, the aggregate solar capacity of India surpassed the total wind capacity in February 2021. Additionally, between April 2020 and February 2021, solar generation was almost 8% higher than the previous fiscal and its share in the total supply was consistently higher. Even though the overall electricity demand fell during the lockdown, there was an attractiveness towards the renewable energy sector. As auctions continued, record low solar tariffs were witnessed, new market entrants won some bids, commissioning deadlines were extended, must-run status was ensured and investors generally shoed a strong interest in the share of renewable companies. In addition to this Indian renewable companies managed to raise billions of dollars of debt from overseas sources till the end of 2021. One dark side of all this progress is that a significant amount of auctioned capacity, mostly solar, has still not been able to find buyers.
For a detailed analysis of the Type in the India Solar Energy Market browse through https://univdatos.com/get-a-free-sample-form-php/?product_id=11234
Based on Type, the Industrial Power Supply market is segmented into Photovoltaic systems and Concentrated solar power systems. Concentrated solar power systems are further sub segmented into Parabolic trough, Solar power tower, Fresnel reflectors, and Dish Stirling. Coal fired thermal power plants are the dominant source of energy generation in India. Coal-fired thermal plants utilize 5-7 Cu m water per MWh of electricity generated, where concentrated solar power systems utilize only 2-3 Cu m water per MWh of electricity generated for cooling and washing mirror surfaces. To reduce the dependence on coal-fired energy production in India, the ambitious Jawaharlal Nehru National Solar Mission (JNNSM) planned to install a total of 470 MW of CSP projects under its phase I (2010-2013).

Continuing delays in the payments by the state-owned distribution utilities (discoms) in key states such as Maharashtra and Rajasthan pose a challenge for the wind energy sector, although some improvement has been seen lately.
On the positive side, the MNRE scheme for procurement of 1 GW through the auction route would facilitate the offtake for wind energy players, according to ICRA.
“While there has been some improvement in the payment pattern by utilities in Rajasthan with the implementation of UDAY (Ujwal Discom Assurance Yojana) as well as by the utility in Maharashtra in the last three month period, a build-up in receivable position is seen, which varies from 8 to 12 months as on November 2016 and thus remains quite significant,” said Sabyasachi Majumdar, Senior Vice President, ICRA Ratings.
“In addition to payment delays by state utilities, wind energy projects remain vulnerable to the risk of non-signing of power purchase agreements (PPAs) by the utilities as seen in Maharashtra and forced back down by utilities in the states of Rajasthan and Tamil Nadu,” Majumdar said.
Further, the implementation of forecasting and scheduling framework, as approved by the State Electricity Regulatory Commission (SERC) in Karnataka and in other states where draft regulations are in place, poses regulatory challenges for the sector, given the variable and intermittent nature of wind power generation and limited experience available with the IPPs in forecasting and scheduling as of now.
Also, the sector continues to face challenges due to the limited compliance of renewable purchase obligation (RPO) norms by the obligated entities as well as the variance in RPO norms across the states.
Notwithstanding these near-term challenges, the long-term demand potential for wind power remains strong, given the large untapped wind power potential, fairly attractive feed-in tariffs and relatively lower execution risks.
ICRA notes that the incremental wind-based energy capacity requirement by FY2022 is estimated at about 46 GW as against the current installed capacity of 28.1 GW. This is assuming annual energy demand growth of 6%, non-solar RPO at 12.5% by FY2022 and wind as a renewable energy (RE) resource contributing to a dominant share (75%) in meeting the non-solar RPO requirement on an all India basis.

At one point in early May 2016, for example, the 1 GW Tehri Hydroelectric Dam, India’s tallest dam, had no usable water stored in its reservoir on the Bhagirathi River in the Himalayas, a tributary of the upper Ganges River, even though it is designed to hold 2.6 billion cubic meters. In May 2016, Central Water Commission (CWC) of India data showed that the Tehri Dam was using almost none of its storage capacity of 2.6 billion cubic meters. At the time, total usable water available in 91 reservoirs across India monitored by the CWC was at just under 31 billion cubic meters, 19 percent of their capacity.
These incidents, taken together, underline the severity and importance of the water-energy nexus and the resulting crisis in India. Water and energy systems are closely intertwined; the scarcity of water in the age of climate change has impacted the coal-fired power plants particularly negatively. While water forms an essential component in all stages of energy production and electricity generation, energy is needed to extract, convert, purify, and deliver water for a variety of human uses, and treat wastewater for auxiliary uses.
Analyzing the Challenge
The problem is far larger than the individual shutdowns of the Farakka, Raichur, and other power plants: India is in the grip of a growing water crisis. The effects of climate change appear to be evident in South Asia in general and in India in particular. Monsoon rains have been scanty in India for the two years in succession. The melting of snow in the Himalayas produced less water compare to previous years. Some 85 percent of the country’s drinking water comes from aquifers, but their levels are falling, according to the WaterAid organization.
The scarcity of water in India makes it difficult for water and energy sector officials to trade-off between power generation and the use of water for drinking, agriculture, and other industries. Some analysts argue that in a water scarcity scenario, power generation will come at the expense of other uses. A new Greenpeace report notes if the Indian government continues to push for the construction of more coal plants, the water crisis will grow significantly worse. The report estimates over 170 GW of coal power plants, representing 40 percent of the proposed Indian coal fleet, are in areas that are facing high or extremely high water stress.

Electricity Grid Substation Automation
To meet the needs of India’s growing economy, providing reliable, affordable and sustainable energy requires exploring a range of options. One of the most important requirements is reinventing the grid with the introduction of grid intelligence and communication systems for its secure and efficient operation. This paper is an attempt towards grid redesign to meet the requirements of the transforming energy sector in India...
- Er. K S Sidhu
India has significant challenges in the power sector. The country is home to about 25% of the worldwide total of 1.4 billion people who lack access to electricity apart from growing centres of electricity consumption. There is also a massive demand-supply gap aggravated by delays in capacity addition and inefficiencies, especially, in network segments. For fulfilling huge power demands, number of generating stations – hydro, thermal, atomic (conventional) and solar and wind etc. (non-conventional) are being created. Depending upon the availability of resources, these stations are constructed at different places. So, it is necessary to transmit these huge power blocks from generating stations to their load centres. The power transmission system is a complex network. Power generated at voltage levels of 11to 33KV, has to be stepped up to high/extra-high voltages (220/400/800KV-AC) and then again reduced in stages to lowest distribution voltage level of 240/415 volts. Typical power system network is shown in the figure.
For maintaining these voltage levels and for providing stability, a number of transformation and switching stations have to be created in between generating station and consumer ends. These transformation and switching stations are known as substations or grid substations or electricity grids. It is these grids that are required to be developed to achieve reduction in system malfunctions as well as reduction in the meantime to repair. Consequently, outage times shall be reduced leading to a significant decrease in the energy losses.
The electricity grid has grown and changed immensely since its origins, when energy systems were small and localized. With the passing of time, rising electricity consumption, new power plants and increasingly decentralised generation (DG) of electricity from renewable energies require grid expansion. However, simply expanding the grid, as it is constructed now, would be highly inefficient. The wildly fluctuating power feed-in from renewable energies (sun, wind) into the entire power grid occasionally leads to unforeseeable power flows, which can affect grid stability.

To help ease the resultant financial stress, the MoP has announced an economic stimulus, providing a liquidity support package of Rs 900 billion for discoms and has reduced late payment penalties for payments to generation companies and transmission licensees. Among other measures, the MNRE has provided a commercial operations date extension of up to five months (that is, up to August 24, 2020) to all renewable energy projects under implementation as on March 25, 2020. The Cabinet Committee on Economic Affairs has also approved a one-time relaxation in working capital limits; this would enable PFC and REC to extend loans to discoms.
What is the investor outlook for the sector?
The power sector has significant potential to grow going forward. On a macro level, India’s current per capita energy consumption (1,181 MW) is about one-third the global average. The country’s population and GDP are expected to grow in the future and energy demand is expected to rise consequently. Further, electrification of villages under the Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) and last-mile electricity connectivity under the Pradhan Mantri Sahaj Bijli Har Ghar Yojana (Saubhagya) will be two prominent drivers for electricity demand. Under the DDUGJY, 100 per cent village electrification was achieved in the year 2018 and around 99 per cent of households have been electrified under Saubhagya. The completion of Saubhagya is expected to create an additional power demand of about 28,000 MW.
To meet the growing demand, significant capacity addition is expected. Under the National Infrastructure Pipeline for the period 2020-25, around Rs 25 trillion worth of capex requirement has been envisaged for the power sector. The government’s thrust to increase the installed capacity of renewables to 175 GW by 2022 is encouraging for us as it would lead to substantial capacity addition in the power sector space. In addition, infrastructural development in the e-mobility space will provide ample business opportunities. The government’s Atmanirbhar Bharat Abhiyan will also open up new investment opportunities in the sector. Thus, with ample growth potential, the power sector is expected to attract huge investments.

Moreover, the sector has been plagued by issues such as the poor financial health of discoms, rising receivables and sporadic fuel supply constraints. Therefore, while the sector achieved success in terms of higher electrification, improved energy efficiency and meeting of power demand before the onset of Covid-19, some discoms remained under financial stress.
Impact of Covid-19 on the power sector: The outbreak of Covid-19 and the consequent countrywide lockdown is a once-in-a-lifetime event with a wide-ranging impact on the power sector. This impact has been in the form of a sudden reduction in demand, financial stress and disruptions in the power supply chain. However, the impact on power generation, transmission and distribution entities has been different.
Distribution: With industrial and commercial activities coming to a halt in the first quarter of this financial year, the demand for power reduced by 25-30 per cent. The situation worsened further due to deferrals of electricity bills to customers and difficulties in collection. With the gradual opening up of industries, electricity demand is now increasing, with annual demand expected to touch pre-pandemic levels by the first quarter of financial year 2020-21. Most discoms are now recording higher online billing and collection.
Generation: The contraction in power demand has led to a decline in offtake and consequently, in the overall PLF of generators. How, the renewable energy sector has fared well compared to the conventional (thermal) sector and most of the decline in power generation appears to have come from the latter. A related development was an increase of 14.5 per cent on a year-on-year basis in electricity volumes traded on the exchange in the first quarter of 2020-21. Another consequence of Covid-19 and its associated issues is significant delays in the resolution of stressed power projects. It is likely to cause further delays in projects under implementation, resulting in time and cost overruns.
Transmission: With reduced power flow across the grid, transmission companies have been registering higher available transmission capacity levels across their interregional and intra-regional links. This, along with the high levels of spare power generation capacity across the country, had resulted in a glut in the secondary power markets during the initial days of the lockdown. However, the situation stabilised as generators withdrew capacities due to subdued demand and offtake from the market.
What has been the industry response to the pandemic?

Other projects in the pipeline include a 120-MW powerhouse project; windfarms with total capacity of 98 MW; the third unit of the Haldia power project with a capacity of 30 MW; and the 114-MW Dagcchu hydropower project. Tata Power also has identified additional projects with a total power-generating capacity of 6,000 MW.
The firm was recently involved in legal skirmishes with Reliance Energy Limited over the supply of 750 MW of power to one of Reliance Energy's group companies. Tata Power had reportedly allocated 800 MW of power-to-power utility Brihanmumbai Electricity Supply and Transport Undertaking and only 500 MW to Reliance Energy.
Tata Power's decision led to Reliance Energy facing a 250-MW shortfall. Reliance Energy filed a petition against this decision with the Appellate Tribunal for Electricity. However, Tata Power has stated that it has not entered into a formal power-purchase agreement with Reliance Energy, although there have been several discussions and attempts made by Tata Power over the years to sign a formal agreement.
Industry experts say India will require investments of about $120 billion to $150 billion to meet the growing commercial and residential energy demand. India, which plans to add 78,500 MW of power-generation capacity by the end of the 11th five-year plan period, 2007-12, has managed to commission only 15,100 MW to date.
Power supply problems are expected to increase in the country because of monsoons and coal-supply shortages. India is expected to face a 12.6% peak power shortfall, equivalent to 14,980 MW, this year. Last fiscal year, the peak power deficit was about 11.9%. The energy scenario in India is precarious, and investments by private-sector players will become critical for the country to achieve its power capacity targets.

Coal is responsible for almost 70% of India's electricity production - that much is agreed upon. But is the problem that there is a shortage of coal to supply the power plants, or does India over-rely on coal?
"As a result of the (coal) domestic production shortfall, India has had to rely on more expensive imported coal. However, because Indian states sell electricity at low, heavily regulated rates, electricity generators have been largely unable to pass on the higher cost of imported coal to consumers. The ultimate result is a crippling shortage of coal."
Rebecca Byerly, correspondent for the Christian Science Monitor, focuses on the environmental, health, and social devastation the coal industry has brought to the Jaintia Hills of northeast India in "India's big power blackout: Why coal hasn't been a savior".
"It looks like something out of an apocalyptic movie: mountains of tar-black coal, polluted orange rivers, and seemingly bottomless holes plunge more than a 100 feet beneath the earth's surface."
She points to a disadvantage of coal in meeting peak power surges.
"Coal operates at a steady output 24 hours a day - it's baseload," says Mr. Justin Guay, the Washington Representative of the Sierra Club International Climate Program. "But coal can't be ramped up quickly to accommodate quick peak surges in demand."
Yet coal reliance need not result in power outages, as NPR illustrates in its comparison of India to another huge, coal-reliant emerging economy.
In Power Outage Exposes India-China Contrasts, NPR's Julie McCarthy in New Delhi and Frank Langfitt in Shanghai explain "the different attitudes toward (energy) infrastructure" and why Indian-style energy outages are not tolerated in China.
Text and audio available.
Thanks to Sierra Club Hitched

While work had been completed in 104,496 villages as on 31 March, according to the Planning Commission, a significant number of the villages are not yet energized—which means power has not started flowing through the grid to the villages.
About 19.4 million poor households have been provided free connection.
Apart from such delays, electricity available in the villages is only for around six hours as poor finances of state electricity boards act as disincentives to provide power. Also, delays in issuance of electricity bills lead to high outstanding dues.
While Chaturvedi admitted that “distribution utilities are not finding it attractive to provide electricity,” he said that delays in issuance of electricity bills leading to households’ inability to pay was “partly true”.
“Some of these are petty excuses. We are concerned about RGGVY and have asked the states to separate the feeders (separate electricity feeds for farmers and non-farmers). Some states are doing it,” he said.
Cumulative losses of the distribution utilities increased from Rs.1.22 trillion in 2009-10 to Rs.1.9 trillion by March 2011.

Financiers are optimistic about the power sector’s long-term growth story. However, distribution reforms must be taken up on priority to instill investor confidence in the sector. Leading financiers share their perspective on the current state of the sector, the challenges, and post-pandemic opportunities and outlook. Excerpts…
What has been the impact of Covid-19 on the power sector?
Parminder Chopra, Director (Finance), PFC Limited
The power sector is one of the critical drivers of the Indian economy. The Covid-19 pandemic has had a severe impact on the economy and the power sector, which is usually resilient, is also reeling under its ill effects. Economic and industrial activity was halted due to the nationwide lockdown imposed since March 2020. This affected the entire power sector value chain in terms of reduced demand and a dip in revenue collection, leading to financial distress and disruptions in the power supply chain. But as the economy is opening up and industrial activity is resuming, power demand is gradually picking up. It started witnessing a gradual increase from May 2020 onwards after the easing of lockdown restrictions. As we can see, within just four months of the lockdown being relaxed, electricity demand touched 174.33 GW, surpassing the demand levels in September last year. Thus, demand is getting restored to its normal levels. We expect a positive power demand outlook going forward. Further, the improvement in power demand would effectively translate into better revenue generation, thereby gradually easing the financial crunch being faced by discoms.
Mukul Modi, Executive Vice-President, Project Advisory and Structured Finance Group, SBICAP
Pre-Covid scenario in the power sector: The centrality of the power sector for the industrial and economic development of a country can hardly be overemphasised. Due to a strong focus and policy initiatives by the government, the power sector has added more than 210 GW of generation capacity in the past one decade, involving an estimated investment of over Rs 13 trillion. However, the growth in power demand has failed to keep pace with capacity addition in the past four to five years. As a result, the overall plant load factor (PLF) of thermal power projects has been hovering at 55-62 per cent, indicating underutilisation of assets.

Highest growth generation company
Balraj Joshi is the Chairman and Managing Director of NHPC since September 22, 2017 and has served as its Director of Technical from March 23, 2018 to July 5, 2018
Replacement Market to Drive BTG Demand
While the government is bullish on capacity additions to meet the rising energy demand, the focus is clearly shifting from thermal to renewable energy. On one hand, the government is harping on the excessive capacity addition during the 12th Plan Period, on the other, it is taking a giant leap in building renewable energy capacity.
Wind energy is an attractive propostion for IPPs
The global renewable energy sector has witnessed rapid growth in the last decade, driven by 3 key factors - widespread deployment of renewable energy technologies at increasingly competitive costs, efficiency brought in by hi-tech products driven by new age technology and new business models for distributed generation and services.
IPPs are not keen for BoP services
Prayasvin Patel, Chairman & Managing Director of Elecon Engineering Co Ltd, feels that IPPs, due to several issues involved in BoP contracts, are more inclined towards EPC.
Power 20:20 | CLP India
CLP India is one of the largest wind power developers in India with close to 1,000 MW of committed wind projects. The wind portfolio of the company that made a beginning with its first project in Khandke in the year 2006, has grown rapidly since then and is an integral part of CLP India´s renewable portfolio.
Amend Act, break CIL monopoly
We have a predominantly heavy dependence on coal and also a large stranded capacity of gas based power supply units. In the first instance, coal supply from Coal India has to be ramped up substantially. The Power Minister may have to convince the new Coal
Mission green corridor
With the completion of the green corridor, PGCIL will take up the challenge to erect and use the grid network, especially for renewable resources. Power Grid Corporation of India has planned a capital investment of Rs 100,000 crore for development of an inter-State transmission system during the 12th Five Year Plan.
Power finance- Layers Within Layers
Just when you thought clearances were the real culprit, it turned out to be just another layer in the complex power industry´s blues now looking like an onion-peel of discovery and tears. The new nemesis, it seems, is lack of finance.

Goyal told industry leaders at the meeting organised on the occasion of the launch of ETEnergyworld.com that the government was going flat out to resolve all the pending issues in the sector, just as it had ensured that thermal power plants, which were starved of coal two years ago, were now flooded with fuel. “Each and every power plant now has coal,” Goyal asserted.
Industry leaders as well as the minister said the UDAY scheme to reform distribution companies was vital for both conventional and renewable power projects. GMR Energy Chairman GBS Raju suggested that utilities should make timely payments to generation companies.
Lanco Infratech Chairman Madhusudhan Rao said states, except Kerala, have stopped issuing tenders seeking electricity and suggested that the government should take ambitious steps to resolve various issues.
Solar and wind energy entrepreneurs including Suzlon Chairman Tulsi Tanti, ReNew Power Chairman Sumant Sinha, Hero Future Energies Chairman Rahul Munjal also highlighted the importance of efficient distribution and transmission as well as grid stability.
Other industry leaders from the sector included Tata Power Solar CEO Ashish Khanna, First Solar country head Sujoy Ghosh, Fortum India Managing Director Sanjay Aggarwal and the Adani Group’s CEO for renewable energy Jayant Parimal.
Sinha sounded a note of caution for entrepreneurs. He said a lot of renewable energy companies are keen on selling their plants after bagging them through aggressive bids. He said this may affect the project implementation and decrease the appetite for new projects in primary market.
Aggressive bidding by companies has reduced solar power tariffs to .`4.34 per unit that is lower than many coalfired plants, and have fallen to a level that many industry experts say is unviable. Finnish utility Fortum, which made the record-low bid is keen to invest in several business segments in the country, Sanjay Aggarwal, who heads Indian operations of the company, told the minister.
The companies expressed concern that state electricity distribution utilities are not purchasing power due to financial constraints and industrial slowdown. SoftBank Energy Chairman Manoj Kohli said emphasis has to be laid on creation of demand. He said the country has not been able to capture ‘pent-up’ demand from consumers.
He highlighted that India needed a policy standardising all procedures including land acquisition, equipment sourcing and signing power purchase agreements, for setting up power plants across the country. This will help investors to mitigate risks.

Coal has always been the mainstay of the Indian electricity sector and many policymakers and analysts believe that it must remain the primary source of electricity generation for at least the next three to four decades. This view is based on the belief that a centralised electricity…Read more

The Government is focusing on three rail links, one each in Bihar, Chhattisgarh and Odisha. However, the earliest link is expected to be commissioned only by 2016.
Land acquisition and Environmental clearance
90% of CIL production comes from open-cast mines. Large land parcels are required to be procured which results in large scale displacement of local population. Pollution by mines makes environmental clearance a lengthy process. Starting a coal mine in India requires about 5 years to 7 years.
Privatization and Restructuring
The Government has recently proposed offloading another 10% in CIL. It is debatable whether privatization should precede break up into smaller, more efficient entities or the other way round.
With a larger stake going to private investors, the Government will need to convince them of safeguarding their rights before restructuring CIL.
Coal based projects face regular situations of low stocks. Many power plants run at below normal capacity even as more capacity is added.
The Coal ministry is in the process of formulating a policy for swapping of coal linkages between State and Central Power utilities. This will help link power plants to the nearest coal mine. The Government has also allowed automatic transfer of linkages from old inefficient plants to ultra-modern supercritical plants in order to maximise generation.
Coal imports have more than doubled in last five years increasing the cost of power generation. While power generators expect that this cost will be passed on to Discoms, they have faced stiff opposition. With large projects like those by Tata and Adani making recurring losses, the country is faced with a choice between higher cost of power and no power.
The Government is also evaluating price pooling of domestic and imported coal. This will help reduce fuel cost for plants running on imported coal. However, this is expected to increase power generation cost in the short term.
Investor confidence in coal-based power projects has taken a hit due to these challenges. NTPC has received proposals for sale of assets from 34 private project developers which constitute 55,000 MW capacity. This includes both operational and under-construction projects (Source: LiveMint). With cancellation of coal blocks, lenders’ financial health is under greater scrutiny.
Need for Adjustments
Given the precarious power situation, the Government needs to show results quickly. In the process, many stakeholders, including investors, lenders and consumers will need to make compromises.

Higher operational efficiencies on the generation side, smart grids and network management are being pursued and need to be accelerated. On the policy front, changes to the Electricity Act along with public-private partnership measures for the distribution sector will be critical in improving investor interest and increasing stakeholder confidence. On the financial side, the current low-interest rate regime will make the sector more competitive. The advent and adoption of newer instruments such as InvITs will enable higher monetisation of operational and viable assets. In addition, existing stressed assets on the banking side will need to be resolved. In a nutshell, the power sector needs to become more sustainable, financially strong and operationally efficient to meet the immediate challenges and tap into opportunities in the post-Covid world.

Anish De, Global Head of Energy & Natural Resources, KPMG
It has been 25 years since the Electricity Regulatory Commission Act of 1998 (ERC Act) introduced independent regulation of the electricity sector on a countrywide basis. Calendar year 2023 also marks two decades of the Electricity Act, 2003, enacted as a comprehensive legislation to consolidate the laws relating to generation, transmission, distribution, trading and use of electricity. The Electricity Act, 2003, which subsumed all previous laws including the Indian Electricity Act, 1910, the Electricity Supply Act, 1948 and the ERC Act, created a fantastic wireframe for, interalia, the development of the electricity industry, promoting competition therein, protecting the interests of consumers and ensuring the supply of electricity to all areas, rationalising electricity tariff, ensuring transparent policies regarding subsidies, promoting efficient and environmentally benign policies, and facilitating the constitution of the Central Electricity Authority, the regulatory commissions, and the appellate tribunal. The Electricity Act, 2003 has often been called the “Rolls-Royce” of legislations, with great merit but for a critical omission relating to the separation of distribution and supply as distinct licensed businesses. The separation of the distribution and supply functions was intensely discussed and debated, but not executed due to the lack of political will and keenness to move ahead with other elements of the landmark law. Although much has been achieved on the basis of the Electricity Act, 2003, this departure from the practices followed by most reforming jurisdictions across the world has ultimately hindered efficiency and competition, prevented much-needed ownership changes, stymied independent regulation or resulted in its capture, and ultimately compromised consumer interests. It remains a critical unfinished agenda in Indian electricity sector reforms.
To appreciate the many successes and also the limitations of electricity sector reforms in the country, it is important to lay out how the sector architecture changed with the reform legislations, and particularly the Electricity Act, 2003. Apart from independent regulation, at the core of the changes in the architecture is the concept of “open access”, which allows non-discriminatory provision for the use of transmission lines or the distribution system, or associated facilities with such lines or system by any licensee or consumer or a person engaged in generation in accordance with the regulations specified by the appropriate commission.

Author of the report Sheoli Pargal who is also an economic adviser says, “As the government’s 24x7 power initiative builds up momentum, utilities need to make sure they are well prepared to use the funds that will become available—to strengthen their transmission grids and distribution infrastructure, create robust corporate governance mechanisms, enhance billing and collection systems, institutionalise regular tariff reviews, and position themselves for extending reliable electricity service to all.”
Projections show that even if tariffs rise six per cent per year to keep up with the cost of supply, annual losses in 2017 will likely amount to Rs 125,300 crore (US$ 27 billion).
“The need of the hour is to improve operational and financial efficiency in distribution through a multi-pronged approach. This could include use of IT for transparent energy audits across the value chain; adopting some of the innovations in reducing Aggregate Technical and Commercial Losses (AT&C) loss pioneered by private sector entities; ring fencing supply to the agricultural sector with a transparently determined and administered subsidy so that rural areas receive reliable power, while revenue maximising models are implemented in urban areas; and improving institutional accountability, following examples like Gujarat and West Bengal,” said Mani Khurana, energy specialist, World Bank.
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Simultaneously the discom should introduce an initiative to publicise the monthly feeder-wise information about supply and revenue collection, and the associated cost-recovery gap. This could be accompanied with a program to incentivise feeders with higher payment compliance by both increasing their supply duration as well as ensuring greater quality. This could also perhaps trigger the hitherto absent demand-side pressures on quality and make this a salient political good.
On the free farm power side, the endeavour should be to first ensure all farm services are metered, even if unbilled. This is the first step to any meaningful engagement to address the problem.
Another intervention would be to introduce direct benefits transfer (DBT) cash subsidy for free-farm power. Farmers can be offered an equivalent (or higher) units of free supply in return for having all farm connections metered and agriculture tariffs fixed. Each farmer would pay his monthly electricity bill, whereupon he would be reimbursed the previous month’s bill to the extent of the free units consumable. Further, the farmer can be incentivized to reduce consumption by reimbursing an amount proportional to his unconsumed units (from the free power unit allotted each month). The introduction of meters will help measure and audit rural supply. The incentives will encourage farmers to optimize consumption. It will also ensure that farmers can now use three-phase supply beyond the 7-10 hours. Besides, it will also boost non-farm economic growth.
These two efforts, on the energy audit and billing as well as free-farm power sides, are practical starting points to engage meaningfully with the problem. It has to be noted that they are not just about some technology interventions or a cash transfer innovation, but about using technology interventions as practical and credible decision-support for discom officials which they then need to then act upon. These interventions can shine light on the problem, identify and quantify leakages, localise and apportion costs, and thereby align incentives for further action.
I have not talked about the political challenges that need to be addressed. They include annual tariff assessments and increases accordingly, allowing discom officials enforce on theft of supply and non-payment of bills, and gradually shift from free and unmetered farm supply to some basic pricing. Equally important is that the demand for continuous and good quality of supply should become an electoral good that would in turn make the aforesaid issues an imperative for the political leaders.

Fourth is the administrative challenge like long delays in granting different clearances such as the ministry of environment and forest clearance, army clearance, land acquisition, techno-economic clearances etc.
Keeping in view Indus water treaty with neighbouring Pakistan small hydropower is politically most acceptable solution for meeting energy security in the region because run off river scheme is generally employed preferably due to suitability of site in hilly regions like Ladakh. In this scheme, there is little poundage or no poundage in the upper stream reservoir because technically less discharge is required to produce sufficient power because of easy availability of natural falls.
The output power evacuation is subject to the instantaneous natural flow of stream unlike large hydro which requires excessive water storage and can violate the treaty as a result project can be treated disputed like Baglihar on Chenab River. Stirring the truth “power sector is the backbone of states economy” state of Jammu & Kashmir was never on footsteps of sorting out this basic concept of economic reform.
That’s why it is essentially required to strengthen and prioritise power sector in our state. We have huge untapped hydropower potential in the region including large hydro but when it comes to harness it to consolidate the power sector in the region efforts seems bleak.
It’s not harnessing at the desired pace due to lack of well framed policies in the state government and perhaps the potential is underplayed. But states like Gujarat and Himachal Pradesh are 1st in solar power and hydropower generation respectively. Unlike our state of Jammu & Kashmir, Gujarat and Himachal Pradesh are doing exceptionally good in these sectors because not only they have potential but mainly because policy making is thrust area into these states.
The friendly and acceptable policies in power sector encompassing society, investors, developers, stakeholders and environment etc. becomes key in harnessing the golden harvest today specially after new land acquisition act 2013 with effect from January 2014! The result of these two states can surely be replicated in the rest of the country especially the reluctant hydro rich state of Jammu and Kashmir. Since private sector participation becomes more pronounced in recent years in Indian power sector designing of investment friendly and public inclined policies becomes a necessary condition.
The resilient people residing in structurally disadvantaged areas of Leh and Kargil have been living with almost no access or little access to electrical energy for ages.

Since the renewable resources are not evenly distributed in the country, the RPO encourages setting up of large generation capacities at resource rich locations, and through a process of certification, the credits can be traded on CERC approved power exchanges, to obligated entities or voluntary buyers. The tariff structure can then be decided to compete in the power sector.
• Considering that a wide section of our society remains un-electrified, could you elaborate on Tata Power’s efforts on decentralized micro-grids to provide access to these communities?
As mentioned earlier, we are in the process of evaluating different business models for distributed power generation and supply to the rural areas. Tata Power has joined hands with different national institutes like the Indian Institute of Technology, University Department of Chemical Technology in developing pilot and demonstration projects in the renewable resource power generation.
Distributed Generation Projects based on biomass as fuel are also being explored. Also, the Capex levels associated with gasifier based projects are being explored to make the smaller size DG plants feasible based on the applicable feed-in-tariff. The company is also testing a 2kW wind turbine that can be mounted on roof tops and provide power to homes. The technology is under pilot stage.
• What are your views on the Phase 2 of the National Solar Mission?
The National Solar Mission (NSM) is definitely a major step forward. It has not just brought solar power onto the national scene but has also helped put India on the global radar, in so far as solar opportunities are concerned. However, the key objective behind the Solar Mission would be achieved only if the framework and necessary industrial base for research, development, manufacturing and harnessing of solar power gets developed in the country to support appropriate growth and cost optimization for the benefit of the masses in an otherwise less favored country, in terms of energy resources. We must always remember we have only a limited option in terms of commercial sources of energy and solar is one of our best opportunities. We need to work expeditiously on continuation of SIPS initiative and similar other programmes for complete assimilation of technological know-how and for nurturing it to our advantage.
This interview was conducted by Anindita Chakraborty, a member of the Sustainability Outlook team.

Out of the 70% of Earth that is covered with water. Less than 2.5% is fresh water –a fraction of which is available for human use in the form of rivers and lakes. This is why for centuries rivers have been the very cornerstone and foundation of civilization, bringing precious drinking water and sustaining the life of millions along its banks.
Today as communities have expanded away from fresh water sources structures that store, transport and utilize vast amounts of water or dams are believed to have become vital for survival. With the growing urban population in India, approximately 1.2 billion people, especially as more of India begins to urbanize, comes an increase in the demand for electricity. As a result, today the uses of rivers and dams have extended to include hydropower generation.
As the National Geographic’s sums up India’s energy situation: “India: the world’s second most populous country is growing far faster than its own significant fossil resources can handle. “…It is the world’s third largest coal producer, is amongst the world’s top CO2 emitters. But because half of its population still has no access to electricity, per capita emissions are the lowest among major economies…’ ‘…The struggle is to increase energy access while holding down emissions growth.’
- A dwindling source of fossil fuels,
- An uncertain market for oil
- Coupled with the projection of exponentially increased energy demand and unsustainable development
The need for renewable, clean and affordable energy is vital.
- Currently the country relies 75% on coal and oil resources and less than 25% on other renewable energy sources.
- Recently, the massive power grid failure in July 2012, reportedly the largest blackout affecting nearly 700 million people, or twice the population of America, clearly illustrated India is struggling to effectively meet its demand.
- In this power crunch the potential of hydropower seems like the glimmering light of hope providing the promise of not only clean energy but also employment and development.
- In fact, according to the World Bank, ‘Hydropower potential is commonly believed to be one of the most important strategic assets of the state for the development of its economy.’
- With an estimated of about 25% of India’s hydropower potential exploited a large percentage remains untapped.

A decade or so ago, there were several issues in the transmission grid such as congestion and splitting, but they have largely been resolved and our visionary planners/regulators have built a great grid. This grid has to be sustained and developed further, and India cannot afford to have underinvestment in transmission. India must have a strong grid as decarbonisation is our agenda. Accordingly, planners, regulators and policymakers need to rethink and facilitate developments in the grid in the times to come.
Currently, the weakest part of power system operations is attracting and retaining human resources. There is need for a change of mindset to develop intrinsic capabilities of existing resources. The system operations infrastructure is excellent, but we need to make the best use of it and bring in innovative systems and processes.
In terms of technology, the old style of transmission has to be augmented. There is a need to adopt advanced technologies such as reactive compensation, flexible AC transmission systems, and light high voltage direct current (HVDCs) systems. Also, there is a need to expand the transmission grid to neighbouring geographies. The One Sun One World One Grid (OSOWOG) initiative will further drive the expansion of the transmission grid. At the state level, too, the grid needs to be expanded and made more robust.
Energy storage needs to be deployed viably in the downstream power sector, that is, at the consumer, building and distribution system level where building a transmission system is difficult. It is ideal to deploy non-wire alternatives such as battery storage in population-dense areas such as Mumbai and Kolkata as it is difficult to build extensive transmission and distribution systems in these cities. Additionally, it is possible to incorporate battery storage systems in industries. At a macrogrid level, it must be noted that battery storage is non-comparable to transmission systems given the scale of GWs of power transmitted in the grid at 400 kV and 765 kV. Hence, it is important to prioritise investment in pumped (hydro) storage as far as energy storage is concerned, until further technological developments occur in battery storage and its costs come down. Energy storage may be deployed more widely if grid-scale large storage becomes viable. Therefore, there is a need to drive energy storage from two extreme sides – chemical-based energy storage at the bottom level (consumer level) and pumped hydro storage at the top (generation level).
OSOWOG is a great initiative for the world from a sustainability point of view.

India will soon witness a new government in control. Among the multitude of burning issues, the new government will have to face the challenge of a growing energy crisis. It will require extraordinary effort, innovative vision and viable solutions to tackle the increasing demand for energy, while maintaining an eco-friendly approach. Energy commodities comprise gas, oil, coal, renewable energy and electricity.
Currently, high levels of consumption with respect to energy-related commodities are paralysing operations in the country because of non-performing policy initiatives. The demand-supply imbalance is evident across all commodities, requiring serious efforts by the new government to augment energy supplies to avoid a severe energy supply crunch.
The Planning Commission indicates that by 2016-17, the country will manage an approximate 6.7 million tonnes of oil and by 2021-22, this will rise to 850 million tonnes. However, this will meet only 70 per cent of the expected demand; the remaining 30 per cent will have to be sourced through imports.
Even though India possesses a rich heterogeneous mix of energy components, deterring policies have created a difficult environment for potential investors.
Demand for coal
Coal will continue its dominant position in India’s energy mix for many years to come. Today, 54 per cent of the total electricity generation capacity is coal-based, and more than 70 per cent of energy generated is from coal-based power plants. As per the 11th Five Year Plan (2007-12), 67 per cent of the planned capacity added is also coal-based. While domestic production is set to touch 795 MT in 2016-17, the projected demand for coal will be 980 MT during the same period.
Coal reserves in India, presently mined by Coal India Limited and its subsidiaries, are around 293.5 billion tonnes, with a few blocks being given to private parties for production of electricity and captive use. From 2012, the country has seen a paradigm shift in coal policy, with the Comptroller and Auditor General stating that there was a national loss of Rs.1,76,000 crore. This resulted in the Ministry of Coal removing coal blocks, but it is obvious that the new government will have to collate a clean coal policy with respect to exploration, mining and use.
Another important concern is the reduction in dependability on imported coal. Last year for instance, we imported 100 million tonnes from Indonesia.

India has suffered yet more blackouts, this time leaving more than 700 million people without power, and raising serious doubts about the country’s failing infrastructure and the government’s ability to meet the increasing energy demand as they pursue ambitions to become an Asian superpower.
20 of India’s 28 states were left without electricity, including the capital New Delhi, when three out of the nation’s five grids went down.
Hundreds of trains ground to a halt, leaving passengers stranded along tracks from Kashmir to Nagaland.
Traffic lights went out causing gridlock in New Delhi, Kolkata, and several other major cities.
Nurses in Delhi were left to operate life-saving equipment by hand when the back-up generators also failed.
In West Bengal, hundreds of miners were trapped underground for hours when lifts stopped working.
The northern grid failed first, quickly followed by the eastern and north-eastern grids, leaving an estimated 710 million in the dark.
Sushil Kumar Shinde, the Indian power minister, blamed the failures on the states individual electricity operators being too greedy and drawing more than their allotted share from the grids. “Everyone overdraws from the grid. Just this morning I held a meeting with power officials from the states and I gave directions that states that overdraw should be punished. We have given instructions that their power supply could be cut.”
Public morale is low at the moment following several consecutive blackouts, anymore could lead to protests or even riots.
By. Joao Peixe of Oilprice.com

On the electricity side, the country may need over 500 billion kilo-watt-hour (kwh) of energy in the year 2004-05 with a total install capacity of at least 150,000 MW (Mega Watt). If we compare these figures with the present level of production of about 150 million tones of coal and lignite, 26 million tones of crude oil and 150 billion kwh of electricity, with a capacity of 43,000 MW, we find a frustrative figure.
In spite of improving the efficiency of utilization and better demand management, there is always picture of deficiency. Hence efforts are needed to face the situation in future years to come.
Another important aspect of energy strategy to be discussed is the energy requirement in rural areas. In India, rural population would still constitute about 70 per cent of the total population by the turn of the century.
To provide the energy requirement of this large segment is always neglected and overlooked. The per capita useful energy consumed per day in rural areas is about 285 k-cal (kilo-calorie) as compared to 414 k-cal in urban areas. Scarcity of commercial sources of energy like petroleum, electricity, coal and natural gas on one side and fast deforestation, dwindling supply of firewood and gradual commercialization of traditional fuel sources on the other, has made it very difficult for the rural people to secure adequate energy supply at a cost which is affordable to them. Hence, now, it is time to give much emphasis on enhancing the non-commercial sources, like bio-gas plants, social forestry (biomass energy) and improved cooking gadgets etc. in rural areas.

Roughly 4.85 mn households – more than 50% of the region – do not have access to electricity
Renewable energy has immense potential in the Northeast and the region can generate its entire electricity from renewable sources, according to Centre for Science and Environment (CSE).“Currently, renewable energy like solar and wind has very little penetration in our north-eastern states – even though there is a huge potential to meet a majority of the region’s energy demand from solar, wind and small hydropower,” said Deputy Director General, CSE, Chandra Bhushan, in his opening remarks on the first day of the CSE conference on the theme “100 % renewable energy future for North East” held at NEDFi complex on Thursday.
Manipur is, in fact, the only state in the region that has a solar policy, the CSE DDG said.The conference is aimed at expanding the role of renewable energy in the electricity mix, as well as in provision of energy access for the region.According to CSE, of India’s 1.3 billion people, almost 240 million do not have access to electricity. The International Energy Agency has further projected that India will have 147 million people without electricity in 2030. At present, renewable energy in the northeast refers only to small hydro power (less than 25 mega-Watts) – even though the region sits on potential reserves of almost 60,000 MW.
To add to this, the north-eastern states have one of the lowest per capita electricity consumption rates in the country: there are still roughly 4.85 million households – more than 50 per cent in the region — that do not have access to electricity. In fact, the per capita electricity consumption in the region is as low as some of the least developed nations.The situation is compounded by the fact that the current government schemes to provide electricity are primarily based on grid expansion. This model has so far not been able to provide electricity to the poor in the country, and may yet fail to do so.
It is in this context that CSE’s latest report Mini-grids: Electricity for all assumes significance. The report was released and discussed at the event. The report presents a model centred on generation-based incentive and subsidy for setting up distribution infrastructure to ensure every household receives one unit of electricity every day.

BHUBANESWAR, India (Thomson Reuters Foundation) - In the next five years, India plans to install 10,000 small-scale solar-power grids across the country to bring basic electrical power to communities without it.
But providing access to a minimal supply of clean energy – enough to power two LED lights for a few hours and charge a mobile phone – is probably not enough to significantly improve people’s lives, new research suggests.
A study in Uttar Pradesh, which looked at more than a thousand homes that had received basic access to clean electricity for the first time, found that spending on expensive kerosene for lighting had fallen, a benefit to families.
But access to a couple hours a day of electricity was not enough to boost savings, help launch new businesses, increase time spent working or studying, or otherwise significantly improve people's lives, researchers found.
What appears to be needed instead are larger clean power systems capable of providing enough energy to power businesses throughout the day, said Michael Aklin, the study's lead author and a political science professor at the University of Pittsburgh.
"Larger off-grid systems that offer more power could be used for appliances and machinery, with more potential for livelihood creation," he told the Thomson Reuters Foundation in an email interview.
Such systems could be used to run businesses such as internet cafes, fuel stations, repair shops and banks, as well as schools and health centres, he said.
Income-earning businesses of that kind would make it easier to pay back the higher up-front costs of installing clean energy systems - and "could make a major contribution to rural development in India", Aklin said.
Adarkanta Jena, 53, an engineer with the government of Odisha state, agreed that at least eight hours of uninterrupted power a day are needed to run popular small businesses such as welding shops producing grills for windows, flour mills and machines for hulling or threshing rice.
And "in 24 hours, 12 hours is the minimum power supply that will enable children to study extra hours, provide women a lighted space to cook and the family not to eat dinner in the dark. Having electricity from 8 a.m. to 8 p.m., at least, could bring social and economic change," he predicted.
Frustrations with the power supply are hardly limited to clean power users in India.