Transcript Republic of India is a Neighbour of China

India’s Modernization
Case of Energy Sector
Presentation at
International Conference on Development
Models of Modernization Processes,
China and the World
September 24 – 26, 2005
Liuzhou, Guangxi Zhuang AR
P.R. China
By
T L Sankar
Administrative Staff College of India,
Hyderabad, India.
CHINA & INDIA
Similarities & Differences
• Most Populous Countries. It is No.2. China is 1.
• Both has unique history of Political stability and a
which has continued for over 50 years.
• Both Countries ware very poor when they got
Independence and have made commendable progress
in many fields.
• Achievements of China are greater in different fields
and its GDP has grown much faster and for longer
periods.
INDIA-Important Achievements.
•
•
•
•
GDP Low Rate of Growth
Food Crisis
Foreign Exchange Crisis
Emerging Energy Crisis
GDP Growth – Story so far
From the dawn of independence, India registered a slow but steady rate of
growth of GDP of only 2 to 3 % per year,criticized as the “Hindu-rate” of
growth.In the early eighties with some changes in the economic
management the growth rate increased to a norm level of 5 to 6%. India is
reaching out to a 8% GDP growth in the new millennium.
GDP Growth
2,500,000
2,000,000
1,500,000
1,000,000
500,000
2002
1999
1996
1993
1990
1987
1984
1981
1978
1975
1972
1969
1966
1963
1960
1957
1954
0
1951
Rs. in Crores
3,000,000
India – Green Revolution
Whenever faced with a Challenge, India bounced back stronger and self
reliant. From a food starved country in 1967, India became self sufficient in foodgrain by the early eighties.
Agricultural Production in India
250
MT
200
150
100
50
0
1
4
7
0
3
6
9
2
5
8
1
4
7
0
3
6
9
2
-5 3 -5 6 -5 9 -6 2 -6 5 -6 8 -6 1 -7 4 -7 7 -7 0 -8 3 -8 6 -8 9 -9 2 -9 5 -9 8 -9 1 -0
0
5
5
5
5
6
6
6
7
7
7
8
8
8
8
9
9
9
0
19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 19 20
• India was among the most successful countries in ushering in the Green
Revolution. Food grain production almost doubled from 72 MT in 1965-66 to 129
MT in 1978-79 during the green revolution. Today the production is close to
212 MT.
India – Forex Reserves
After Green Revolution, India proved itself again – this time on the Forex
Front
Forex Reserves of India
140.00
120.00
Bn $
100.00
80.00
60.00
From Crisis to
Abundance
40.00
20.00
19
50
-5
19 1
62
-6
19 3
65
19 66
68
-6
19 9
71
-7
19 2
74
19 75
77
-7
19 8
80
-8
19 1
83
-8
19 4
86
19 87
89
-9
19 0
92
-9
19 3
95
19 96
98
-9
20 9
01
-0
20 2
04
-0
5
0.00
Source : India Infoline -Economic Survey of India
• With less than $ 2 Billion forex reserves in 1991, the reserves have
leapfrogged to nearly $130 Billion due to a series of economic reforms
and continued focus on economic development
Per Capita Energy Consumption
In spite of this growth, the per capita energy consumption of India is far lower than that of
the developed nations and some developing nations. Even to reach world average it has
to increase five fold. With a population of over a billion, fast moving towards 1.5 billion,
this would be a daunting task with some consequences for the world energy market.
TPES (MtOE)
India
0.3
China
0.96
Japan
4.05
USA
7.96
1.65
World Avg
0
1
2
3
4
5
6
7
8
9
MtOE
Electricity Consumption per Capita (kWh)
India
526
China
1247
Japan
8935
14378
USA
2571
World Avg
0
2000
4000
6000
8000
kWh
10000
12000
14000
16000
Source : BP Statistical Review of World Energy 2004
India’s approach towards self-reliance in energy could help India & also
other countries
Energy Situation
• Major sources of Energy are:
• Biomass-used for cooking in rural and poor urban
households
• Coal – used for heating in industries, power
generation and steel-making
• Oil -- used in transport,cooking in urban
households,in industries and irrigation.
• Gas----used in making fertilizer,chemicals, as
auto-fuel, as domestic fuel and power
generation.
• Electricity –used for household lighting,in industries ,in
irrigation in transport and all sectors
Summary Primary Fuel Consumption 1990-2004
(In Primary Units)
Item
Units
1989-90
1994-95
1999-00
2003-04
Rate of Growth
1989-2003
234
267
305
340
2.7%
-
-
-
-
-
Traditional
Fuels Total
Million tons
Commercial
Fuels
-
Total Coal
Million tons
208
269
324
381
3.5%
Total Oil
Million tons
57
71
103
124
5.7%
Natural Gas
Million m3
11172
17339
26885
30900
7.5%
Hydroelectric
Million kWh
62132
82727
80853
75242
1.4%
Nuclear
Electricity
Million kWh
4625
5648
13249
17980
10.2%
Others
(Renewable)
etc.
Total Primary
Electricity
Supply
Million kWh
146
769
5294
16121
Very
Low base
Million kWh
66903
89144
99396
109343
3.6%
Energy Consumption in Oil Equivalent Terms (mtoe)
Item
1989-90
1994-95
1999-00
2003-04
Traditional Fuels Total
72
83
95
106
Commercial Fuel Total
-
-
-
-
Coal
95
121
145
171
Oil
57
71
105
124
Gas
10
16
24
44
Hydroelectric
14.4
19.8
19.4
18.0
Nuclear Electricity
1.1
1.4
3.2
4.3
Others (Renewable) etc.
0.04
0.18
1.27
4.2
Total Primary Electricity Supply
15.5
21.4
23.9
26.5
Total Commercial Energy Supply
(sum of 2.1 to 2.7)
Grand Total Energy Supply
(1 + 3)
177.5
229.4
297.9
365.5
249.5
312.4
392.9
471.5
India: Commercial Energy Consumption – Import
Dependency
Total Commercial
Nuclear &
Renewable
(mtoe)
Available
Total
supply
(mtoe)
Imports
(mtoe)
Import
Dependency
%
Coal &
Lignite
(mtoe)
Oil
(mtoe)
1980-81
58.5
34.0
1.3
10.9
0.8
105.5
23.7
22.5
1989-90
95.0
57.0
10.0
14.4
1.1
177.5
28.4
16.0
1994-95
121.0
71.0
16.0
19.8
1.6
229.4
48.4
21.1
1990-00
145.0
105.0
24.0
19.4
4.5
297.9
84.1
30.0
2001-02
171.0
124.0
44.0
18.0
8.5
365.5
109.0
29.8
Year
Natural
Gas
(mtoe)
HydroElectric
Generatio
n
(mtoe)
India – Energy Needs 1/2
Several forecasts of India’s energy
needs have been attempted by
different agencies. However, they
have used data of different periods
and the GDP growth rates and
horizons of the forecast vary.
For this presentation, using the latest
data and based on long-term elasticity's,
a new forecast has been attempted.
Elasticities experienced by India
Period
1980/81-2003/04
1990/91-2003/04
1994/95-2003/04
TPCES
Electricity
mtoe wrt
Generated
GDP (in
(utilities+non
1993-94)
utilities) Mus
Rs. Crores wrt to GDP
0.97
1.24
0.80
1.04
0.74
0.98
PERI0D
TPCES
Elasticity
ELECTRICITY
Elasticity
2004-052014-15
0.80
0.95
2014-152024-25
0.75
0.85
2024-252029-30
0.70
0.78
TCPES =Total Primary Commercial Energy Supply.
GDP = Gross Domestic Product at constant Factor cost .
M Units = Million kWh of electricity
mtoe = Metric Tonne Oil Equivalent.
India – Energy Needs 2/2
Based on Elasticities set out, demand for Total Primary Commercial Energy Supply (TPCES) and
Electricity supply have been projected assuming, a GDP Growth of 8% and official population
estimates.
Year
2004-05
2009-10
2014-15
2019-20
2024-25
2029-30
Population
Mn
1084
1169
1259
1356
1461
1573
TPCES
Electricity
Bwh
341
680
465
981
1415
1966
2731
3700
634
848
1135
1490
Forecast of Energy Dem and - Indices
600
500
400
Populat ion
300
TPES
200
Elect ricit y
100
0
2004-05
2009-10
2014-15
2019-20
2024-25
2029-30
A comparison of the rates of increase of supply of energy in the past with the rates required as per
the forecast is set out in the table below :
Period
TPCES
Electricity Generated
(Utilities+non utilities)
1980-2003
(Actual)
5.1%
6.9%
2004-2019(Reqd.)
6.2%
7.3%
2020-2030
(Reqd.)
5.8%
6.6%
The demand forecast suggest that the effort in
supplying total primary energy consumption in
the next decade would be about 1% higher than
in the past it was around 5%. This will call for
some concerted effort.
India – Specific Fuel Needs for Non Power uses
The important commercial energy sources are Coal Oil ,Gas and Electricity. Power is generated
from primary sources namely, nuclear, hydro and renewable and as thermal electricity from fuel
sources namely coal and natural gas.The demand for oil,gas and coal for non-power uses and
production of electricity from primary sources are first estimated. The coal and natural gas
requirements for power generation are added, to derive the total fuel needs including for power
generation.
Past Rates of Growth of fuel supply
Year
1970-80
Non-power-Coking Coal
3.62%
Non power-Non Coking coal
1.96%
Non Power Oil products
5.40%
Non Power Gas
8.90%
1980-90
2.75%
2.34%
6.00%
23.00%
1990-2003
0
2.04%
4.90%
8.20%
Based on these growth rates, and adjusting for a higher 8% GDP
growth, the specific fuel needs for non power uses are projected.
Fuel needs for Non Power Use
Fuel Needs for Non Power use
350
Year
2004-05
2009-10
2014-15
2019-20
2024-25
2029-30
Coal MMT
109
130
156
186
222
265
Oil MMT
127
152
181
216
259
309
Natural
Gas BCM
21
25
30
36
43
51
300
250
Coal MMT
200
Oil MMT
150
Natural
Gas BCM
100
50
0
2004-05
2009-10
2014-15
2019-20
2024-25
2029-30
Power generation-non fuel modes of production
The preferred source for power generation should be non-fuel sources - hydroelectric sources, nuclear wind,
solar& other renewables.
Production from non-fuel sources, however, is constrained by a few factors:
•Nuclear –
Policy constraints, uranium availability, likely date of commercializing fast breeder reactors or
thorium based cycles.
•Hydel –
Adequate investigations, obtaining environmental clearance, making R&R
arrangements
•Renewable – Snags in technology, high costs
The following targets have been adopted by for this exercise:
•Nuclear cumulative capacity 25,000 MW by 2030.
•Hydel – 20% of total power generation by 2030.
•Renewable – 5% of total electricity generated by 2030.
The fuel needs or forecast is done by first deriving the electricity likely from Non -fuel sources and
then estimating the share of different fuels in power generation
Billion kWh.
Non- Fuel based Power Generation
Non Thermal
Thermal
Total
Year
Electricity
Supply Reqd
(a)
Hydro –(20%)
(b)
Nuclear (c)
Renewable
(5%)
(d)
Fuel Based
=(a)-(b)-(c)(d)
2004-05
680
136
15
29
500
2009-10
981
196
25
49
711
2014-15
1415
283
41
70
1021
2019-20
1966
393
66
98
1409
2024-25
2731
546
108
136
1941
2029-30
3700
740
175
185
2600
India Fuel Needs for power
 Coal continues to be preferred fuel for power generation. There are additional factors in favour of coal
• Predictability of future prices is higher in coal than in gas.
• Long term fixed price contracts indexed to labour costs are possible in case of coal.
 However, the recent shortages have led to a view that coal will not be available to support the power
development fully. Natural Gas will be the alternative.
To arrive at total fuel needs of India, two alternative scenarios are developed.
Scenario – I Gas based generation would be as at
present, 13% of total thermal generation and rest 87%
will be from coal.
Year
Total
Thermal
Electricity
(BkWh)
Coal
based
BkWh
Gas
based
BkWh
Coal
Req.
MMT
Gas
Req.
BCM.
Scenario-II Coal production will be constrained to a
growth rate of 5% considered as easily achievable and
the rest of power requirement would be using gas.
Year
Total
Thermal
Electricity
(BkWh)
Coal
based
BkWh
Gas
based
BkWh
Coal
Req.
MMT
Gas
Req.
BCM.
04-05
500
425
75
297
15
04-05
500
370
130
259
26
09-10
711
605
106
424
21
09-10
711
493
238
331
47
14-15
1021
868
153
609
31
14-15
1021
609
418
422
84
19-20
1409
1198
211
839
43
19-20
1409
769
640
538
128
24-25
1941
1650
291
1155
58
24-25
1941
984
957
683
191
29-30
2600
2210
390
1547
78
29-30
2600
1253
1347
877
269
Energy Demand Scenarios
The total energy requirements both primary and secondary are summarized under the two
scenarios. if India does not produce coal as required gas imports will have to substitute
coal and this will increase the electricity price in both scenarios.
Scenario-I
Year
Coal
(MMT)
Oil
(MMT)
Natural Gas
(BCM)
Total Electricity
(BkWH)
2004-05
406
127
36
680
2009-10
554
152
46
981
2014-15
764
181
61
1415
2019-20
1025
216
79
1966
2024-25
1380
259
101
2731
2029-30
1812
309
129
3700
Coal
(MMT)
Oil
(MMT)
Natural Gas
(BCM)
Total Electricity
(BkWH)
2004-05
368
127
47
680
2009-10
461
152
72
981
2014-15
578
181
114
1415
2019-20
724
216
164
1966
2024-25
909
259
234
2731
2029-30
1142
309
320
3700
Scenario-II
Year
MMT = Million Tonnes
BCM = Billion Cubic Meters
BkWH= Billion Units of
Electricity.
Estimated Assessed Coal Resources (Billion Tons)
Assessed Resources
Depth Ranges in Meters
Proved
Indicated
Inferred
Prognosticated
63.2
40.8
7.1
2.2
113.3
5.8
21.5
6.5
13.9
47.7
13.7
0.3
0.0
0.0
14.0
600-1200 m
1.7
6.4
1.7
19.7
29.5
Total 0-1200
84.4
69
15.3
35.8
204.5
0-300
300-600
0-600 (Jharia Only)
a
Total
Coal Sector Modernization 1/2
Modernization Efforts So far
• India Third largest producer of coal 400 mt/yr. China 1st –
2000 mt/yr. USA 2nd 100 mt/yr.
• Deposits are: 8.6 % of the world, China 12 %, USA 25 %.
• Mining Coal began in India in 1774 for steam trains.
• On date independence around 50 mt/year from
over 3000 mines, mostly private.
• 1971-73, all coal mines were nationalised and
consolidated.
• From 1975, coal for railways got reduced to near
zero today. But coal for power generation
increased.
Coal Sector Modernization 2/2
• Only two major public sector Coal India Limited (CIL)
and Singareni Colliery Company Limited. (SCCL)
• Production in 2003-04 is around 400 tonnes
• Projected demand in 2029-30 in 1242 (Low Coal
Scenario) 1812 (High Coal Scenario).
Coal Sector – Strategies for Future
A committee under T L Sankar is examining the following:
* India is the third largest producer of coal with 400 mt/yr. China leads with
2000mt/yr distantly followed by USA as second with 1100mt/yr. All three are
planning to increase coal production in the next two decades. If India produce
and uses 1800mt in 2029-30, the CO2 emission would be about 5.5 billion tonnes
– lower than current US pollution and one third of US in per-capita terms.India
should use more coal but produce and use it in a responsible manner, keeping
local and global pollution efforts to the minimum.
* Pending the Parliament passing the Coal Mines Nationalization(Amendment)
Bill,various measures for liberalizing captive coal mining provisions.
• Use of modern technology to augment productivity and quality
• Adoption of clean coal technologies, such as IGCC, Carbon sequestration etc.
• Create competition among public sector coal companies at the State and Central
level.
• Rationalization of railway freights
• Creating a vibrant coal trade involving imports exports and internal trade
through e-auction and commodity trade channels.
Oil and Gas Reserves
Crude Oil
(Million Tons)
Natural Gas
(Bullion Cubic
Meters
On-Shore
308
301
Off-Shore
352
462
Total
660
763
Average annual
production
33
29
R/P Ratio
20
26
Area
a.
Oil Sector Modernization 1/2
• In Pre-independence days oil was extracted very small
quantities in Assam by British owned oil companies.
• In 1955, Oil & Natural Gas Commission was
established by Legislative sanction.
• With mainly USSR assistance oil exploration was done
on shore and off-shore.
• In early Seventies, Bombay High off-shore discovery
increased crude production to over 30 mt/yr.
• From 1990, India adopted a liberalised economic policy
& private companies were given exploration and
development leases under NELP.
• Production of oil has stagnated around 30 mt/yr.
• Production of Gas has increased as shown in table.
Oil Sector Modernization 2/2
• Oil production were imported and marketed by private
oil companies, Burma Shell, Caltex etc.
• Indian Oil Company was established in 1959, to import
crude and refine it to products. This has expanded its
capacity to about 55 million tonnes throughput
• Private oil companies were nationalized I 1976 but
continued as separate companies to provide a
competitive market.
• Private agencies can establish refineries and the one
fully private refinery is the largest single unit refinery
with 20 million tonnes throughput.
Petroleum
India is the sixth largest oil consumer in the world with a share of
3.1% of the world consumption. The dependence on import for oil has
reached a level of 72%.
140
116.01
Million Tonnes
120
100
106.97
80
60
57.75
33.37
32.43
40
32.26
20
33.02
19.14
3.46
0.26
0
1951 1956
8.29
0.45
1961
1966
6.82
1971
1976
10.51
1981
1986
1991
1996
2001
2006
Years (1951-2004)
(Production and Consumption Figures Pertain to the Year Ending of the Concerned Financial
Year)
Domestic Crude Oil Production
Domestic Crude Oil Consumption.
The crude refining capacity of India today is at 132 MT. India has
achieved self sufficiency in refining, at the present demand level.
Oil Pricing& Subsidies
• Problem
•
•
•
•
Crude is imported-products are not
imported or exported ,except
marginally. Product prices are revised
with reference to the average of two
price publications.Index of product
price has risen faster than crude
price.Refiners get windfall gains!
Duties & taxes are ad-valorem and
increase retail prices further.!
Diesel & kerosene price difference
leads to large scale adulteration. Kero
subsidy is not focussed on BPL
population.PDS is defunct in many
places.
LPG benefits commercial
establishments
– Possible Actions
•
•
•
•
Product price should be indexed to
crude price allowing a good Gross
Refinery Margin.
Duties and taxes should be fixed w,r.t
quantity and adjusted on a half-yearly
basis to absorb part of the oil price
increase shock.
Market retail price of kerosene and
diesel should be equal .The BPL
families would get Kero-coupons and
collect kerosene at a lower price with
coupons which could be encased by oil
companies.
Misuse of subsidized LPG should be
ruthlessly weeded out.
Natural Gas-Strategies for Future
Natural Gas production stands at 32 BCM per annum and the
reserves at 922 BCM
Growth in Production of Natural Gas (BCM)
40
29.5
29.7
31.4
32
2001
2002
2003
2004
30
18
20
10
1.4
2.4
1971
1981
0
1991
• After a major jump in the production of
natural gas in late 90s, the production has
stagnated
• The new gas finds especially in deep off
shore wells have added reserves of another
195 BCM in Reliance and 560 BCM in GSPC
Fields.ONGC has not disclosed the
reserves . These are yet to be certified by
DGH.
Figure 3.5: Reserves of Natural Gas (BCM)
• The new exploration by all agencies
including ONGC is delaying the
development of the gas fields in the hope
that there will soon be a severe shortage
of power and gas at high cost will be
purchased by power generators.Even
signed agreements are dishonored with
impunity !
1000
900
800
700
600
500
400
300
200
100
0
922.8
853.48
729.79
762.95
750.71
1991
2001
2002
410.65
62.29
1971
1981
2003
2004
Natural Gas – Demand Supply-price nexus
BCM
Demand
Supply
2004-05
36
34
2009-10
41
57
2014-15
52
85
2019-20
68
103
2024-25
85
?
2029-30
113
?
Year
This demand-supply is on Business-as usual
basis.
.New finds of gas deposits and promise of more
have raised hopes of increased use of gas for
power generation. India’s unique location of
being close to some of the world’s largest gas
deposits in Qatar, Oman, Iran and Central Asia
has raised hopes to get piped gas or LNG from
these sources.
The price of gas defines the sectors and levels
of use. At $4 per MMBTU and above gas can be
used only in fertilizer, petrochemical and as
auto fuel and domestic fuel. If the price of
imported gas is about $3 per MMBTU, gas can
substitute coal for power generation and its
demand can become very large.
Market rumours are that oil ministry is keen that
gas prices settle at a high level !
Indian Nuclear Power Programme
India plans to have an installed Nuclear power capacity of about 21,180 MW by 2020
CAPACITY MWe
14 reactors at 6 sites under operation
2770
2,770
6 PHWRs under construction
1,960
2 LWRs under construction
2,000
PFBR at Kalpakkam
500
Projects planned till 2020
13,900
TOTAL by 2020
21,180
India’s Nuclear Power Programme is designed with the long term objective to
serve as the source of electricity when other sources get exhausted. It is a key
element of the energy self reliance strategy.In is dependent on developing
technologies to use fuel breeding fast breeder reactors and Plutonium thorium
mix as fuel.For this we may have to use imported fuel in about 7000 Mwe
capacity.
Hydro Power
India holds a potential to the tune of 150,000 MW of low PLF
Installed capacity today is 23,488 MW -just about 17% of the potential.
GOI in a recent exercise, Hydro Electricity Initiative, has made a comprehensive l
survey of all potential hydroelectric sites for 50000 MW capacity and has
identified 7000 MW projects which can deliver power at less than Rs 2.0/Kwhr.
India has established mutually beneficial arrangements with Bhutan where
projects constructed mostly with Indian capital are handed over to Bhutan
Government for management and power is purchased at mutually agreed rates.
About 300 MW is being purchased and a new project with over 1000 MW will be
ready by 2006 . Further potential is over 10000 MW for imports from Bhutan.
Nepal is also likely source for over 20000 MWs
The possibilities of developing power generation from multiple sources
and the opportunity to import hydel power from neighbouring countries
suggest that achievement of the required level of power supply is within
reach.
Renewable Energy Potential & Achievements March (2003)
Potential
Potential Exploited
Solar Energy
5x10 whr/yr
47 MW
Biomass-based power
17,000 MW
484 MW
Small hydro
15,000 MW
1509 MW
Wind Energy
45,000 MW
1870 MW
Ocean Thermal
50,000 MW
--
Sea Wave Power
20,000 MW
--
9,000 MW
--
Tidal Power
a
Growth of Power Sector
Sl
1
Description
Installed Capacity (MW) (30.8.2005)
1950
1564
2005
1,21,775
2
3
4
Energy Generated (mKWh)
Villages Electrified (Nos.)(31.12.2004)
Percentage of Villages Electrified (%)
5100
3061
0.54
5,58,336
4,97,133
84.7
5
6
7
Households Electrified (Lakhs)(55%)
Population Served (Lakhs)
Irrigation pumpsets energized (Nos)*
8 Consumers (Million)
9
Per capita consumption (kWh)
* 31.12.2004.
1073
3693
21008 142,90,457
15.6
130.60
592
Power Sector - Reform Progress
1948
Electricity (Supply) Act -Central Electricity Authority (CEA)
and the state Electricity Boards.
1959-60
Growth of State Grids.
1964
Regional Electricity Boards formed.
1974
Independent Ministry of Power
1975
CEA as a separate entity
1975
Central PSUs established
1980-88
Regional Grids Growth
1989
Power Grid Corporation of India formed.
1991
Private Sector invited to Electricity sector
1998
Electricity Regulatory Commission
2000
APDP
2003
Electricity Act, 2003
2005
National Electricity Policy
Power Sector : Current Scenario
Generating Capacity (August 2005)
Mode-wise breakup:
Thermal
Hydro
Nuclear
RES etc.
Total
80562 MW
31745 MW
3310 MW
6158 MW
-------------------121775 MW
Power Sector : Current Scenario (Contd.)
Installed Capacity under State, Central
and Private Sector
(31.01.2005) Sector wise Generating Capacity
Sector
State
Thermal
(Including Gas)
Hydro
41898
24802
Nuclear
-
Wind
Etc.
Total
3496
70197
Private
11%
12809
Central
29427
6032
Private
9237
910
80562
31745
Total
3310
-
38769
- 2662
12809
3310
6158 121775
38768
Central
32%
70197
State
57%
Power Sector : Current Scenario (Contd.)
• Regional Grids in operation.
• Moving towards National Grid.
• Regional Transmission Capacity
– over 8000 MW.
• Demand Supply Gap.
Energy – 8%.
Peak Demand – 12 to 16%.
Reform Architecture
Regulatory Reforms.
New Regulatory Framework:
Establishment of CERC & SERCs.
Restructuring Initiatives.
Restructuring of the Power Industry especially
the State Electricity Boards.
Regulatory Reforms
Electricity Regulatory Commission Act, 1998 and
Electricity Act, 2003.
Central Electricity Regulatory Commission (CERC).
State Electricity Regulatory Commission (SERC).
Independent and autonomous Commission to
regulate the electricity sector.
Government role limited to that of a policy maker
and a facilitator.
Restructuring Options:
Functional Unbundling
Generation Co.(s)
• Responsible for Power Generation.
• Setting up new Generating Stations.
Transmission Co.
• Management of entire Transmission System.
• Purchase and bulk supply and wheeling.
• Grid operation.
Distribution Co.(s)
• Management of existing distribution system.
• Extension of supply to new consumers.
• Bulk purchase and retail sales.
Consumers
Advantages of Unbundling on
Functional Basis
Individual activities will get proper focus
for development.
Provides transparency and accountability
in the performance of different functions.
Promotes Competition or yardstick
competition in the functioning of various
units.
Electricity Act, 2003
Generation de-licensed.
Captive generation liberalized.
Distributed generation encouraged.
Open Access on Transmission lines.
Open Access in Distribution.
Trading in power.
Removal of Exclusivity in Distribution license.
Electricity Act, 2003
(Contd.)
State Government shall establish a State Load
Despatch Centre (SLDC).
State Load Despatch Centre shall not engage in the
business of trading.
State Government may notify the Board or a
Government company as the State Transmission
Utility (STU).
STU shall not engage in the business of trading.
Power Sector-Continuing Challenges.
•
•
CHALLENGES
With the enactment of the Electricity
Act 2003 the legal & Institutional
problems resolved.
• Managerial and governance
.problems remain:
- Inadequacy of supply
- High T&D losses
-Poor quality of supply
-Total lack of consumer
concerns
-Irrational tariffs
-Metering and billing
inefficiency
•
POSSIBLE SOLUTIONS
. • Encouraging Generation investment in all
sizes of plants.
• Aggressively promoting Captive power
generation by clarity in regulation of open
access & surcharge.
• Enforcing franchisee system at sub-station
or feeder level involving consumers,
• Introducing total transparency in
distribution through publishing a)Feeder
level daily energy flows
b).All info on the connected load and total
collection of revenue under each feeder
and list of customers with pending bills of
> 3months
c) Daily feeder-wise interruption report
CAIDI should be published.
• Spot billing with instantaneous printing.
•
*
Summing up
Today the energy scene in India is admittedly disappointing. A crisis is brewing.
The wakeup call has been given India has started responding.
We have the material resources. We have a competent technical man-power of adequate
quality and quantity. We have the appropriate leadership at the top. India’s Prime Minister is
arguably the most erudite and honest leader in the World. He has the reputation for having
steered India over the forex crisis.
We are acutely aware that managing the emerging Energy Crisis involves:
-managing Oil imports – how much would depend on actions taken towards conservation of
oil in transport sector, introduction of new mass transport, and development of environment
friendly cost effective bio-liquid fuels.
- improving efficiency of power sector,in respect of governance, modernization and
professionalization and
- introducing appropriate reforms in the coal sector including environment policies to
accelerate coal production.
Achieving these would not be easy.
But,
The will to overcome the crisis is emerging .
My Vision : India Energy 2050
•
•
•
•
•
•
•
•
There will be adequate power of appropriate quality sold by competing producers,
traders and suppliers. Poor householders and agriculturalists will have coupons
with a monetary value given to them personally which they can use to purchase
from any source. All consumers can have a choice of suppliers.
All renewable energy technologies will be viable. India will produce power from
Wind,water and sun in plants of all sizes. Large power plants using hydro electric
resources, Coal and safe Nuclear technologies using Thorium will produce huge
quantities of power.
Open access will be available on all EHV,HV and even major distribution
lines.Transmitting power will be like traveling along Highways with tolls.
Utilities will sell power to groups of consumers under a feeder line.This group can
choose to buy from a number of any competing power supplier.
Oil use will be reduced to the maximum by use of fuel efficient and hydrogen based
cars and by Bio-fuels which by then could totally replace petrol and diesel.
Energy use will adopt 100% efficient practices in all sectors.
Every drop of water will be used wisely.
Every adult would have a useful employment and public role.
Last Words.
I can only end with the hope which keeps me going.
We were challenged by Hindu-rate of growth, we have over come !
We were challenged by Food Crisis, We have overcome !
We were challenged by Forex Crisis, We have overcome !
Now, we are being challenged by Energy Crisis,
We shall overcome !
THANKS