Electricity transmission and distribution[edit]
See also: Availability based tariff
| Capacity | Substations [124] (MVA) | Transmission lines [125] (c.km) | c.km / MVA ratio[126] |
|---|---|---|---|
| ± 500 kV HVDC | 13,500 | 9,432 | 0.699 |
| 765 kV | 121,500 | 18,644 | 0.153 |
| 400 kV | 192,422 | 135,949 | 0.707 |
| 200 kV | 268,678 | 149,412 | 0.556 |
The spread of high voltage transmission lines is such that it can form a square matrix of area 416 km2 (i.e. on average, at least one HV line within 10.2 km distance/vicinity) in entire area of the country. The length of high-voltage transmission lines is nearly equal to that of the United States (322,000 km (200,000 mi) of 230 kV and above) but transmits far less electricity.[129] The HV transmission lines (132 kV and above) installed in the country is nearly 700,000 km (430,000 mi) (i.e. on average, at least one ≥13 kV transmission line within 4.5 km distance).[130] The length of transmission lines (400 V and above and excluding 220 V lines) is 10,558,177 km (6,560,547 mi) as on 31 March 2015 in the country.[3] The spread of total transmission lines (≥400 V) is such that it can form a square matrix of area 36.8 km2 (i.e. on average, at least one transmission line within 3 km distance) in entire area of the country.
The all-time maximum peak load is not exceeding 153,515 MW in the unified grid whereas the all-time peak load met is 148,005 MW on 11 September 2015.[131] The maximum achieved demand factor of substations is not exceeding 60% at 200 kV level. The operational performance of the huge capacity substations and the vast network of high voltage transmission lines with low demand factor is not satisfactory in meeting the peak electricity load.[132] Detailed forensic engineering studies are to be undertaken and system inadequacies rectified to evolve into smart grid for maximising utility of the existing transmission infrastructure with optimum future capital investments.[35]
The July 2012 blackout, affecting the north of the country, was the largest power grid failure in history by number of people affected. The introduction of Availability Based Tariff (ABT) has brought about stability to a great extent in the Indian transmission grids. However, presently it is becoming outdated in a power surplus grid.
India's Aggregate Transmission and Commercial (ATC) losses is 27% in 2011-12.[133][134] Whereas the total ATC loss was only 9.43% out of the 4,113 billion kWh electricity supplied in USA during the year 2013. The Government has pegged the national ATC losses at around 24% for the year 2011 & has set a target of reducing them to 17.1% by 2017 & to 14.1% by 2022. A high proportion of non-technical losses are caused by illegal tapping of lines, and faulty electric meters that underestimate actual consumption also contribute to reduced payment collection. A case study in Kerala estimated that replacing faulty meters could reduce distribution losses from 34% to 29%.[42]
Regulation and administration[edit]
The Ministry of Power is India's apex central government body regulating the electrical energy sector in India. This ministry was created on 2 July 1992. It is responsible for planning, policy formulation, processing of projects for investment decisions, monitoring project implementation, training and manpower development, and the administration and enactment of legislation in regard to thermal, hydro power generation, transmission and distribution. It is also responsible for the administration of India's Electricity Act (2003), the Energy Conservation Act (2001) and to undertake such amendments to these Acts, as and when necessary, in conformity with the Indian government's policy objectives.[135]Electricity is a concurrent list subject at Entry 38 in List III of the seventh Schedule of the Constitution of India. In India's federal governance structure, this means that both the central government and India's state governments are involved in establishing policy and laws for its electricity sector. This principle motivates central government of India and individual state governments to enter into memorandum of understanding to help expedite projects and reform electricity sector in respective state.[136]
Trading[edit]
Bulk power purchasers can buy electricity on daily basis for short, medium and long term duration from reverse e-auction facility.[137] The electricity prices transacted under reverse e-auction facility are far less than the prices agreed under bilateral agreements.[138] Multi Commodity Exchange has sought permission to offer electricity future markets in India.[139]Government-owned power companies[edit]
India's Ministry of Power administers central government owned companies involved in the generation of electricity in India. These include National Thermal Power Corporation, Damodar Valley Corporation, National Hydroelectric Power Corporation and Nuclear Power Corporation of India. The Power Grid Corporation of India is also administered by the Ministry; it is responsible for the inter-state transmission of electricity and the development of national grid.The Ministry works with various state governments in matters related to state government owned corporations in India's electricity sector. Examples of state corporations include Telangana Power Generation Corporation, Andhra Pradesh Power Generation Corporation Limited, Assam Power Generation Corporation Limited, Tamil Nadu Electricity Board, Maharashtra State Electricity Board, Kerala State Electricity Board, and Gujarat Urja Vikas Nigam Limited.[1]
Funding of power infrastructure[edit]
India's Ministry of Power administers Rural Electrification Corporation Limited and Power Finance Corporation Limited. These central government owned public sector enterprises provide loans and guarantees for public and private electricity sector infrastructure projects in India.Borrowing by state owned discoms[edit]
- The accumulated losses of state-owned discoms (without subsidies) rose from Rs 11,699 crore in 2004-05 to Rs 71,271 crore in 2013-14. These losses have resulted in state discoms relying more on short-term loans to fund their operations. Borrowings by state discoms rose from Rs 1,58,003 crore in 2007-08 to Rs 5,45,922 crore in 2013-14 (CAGR 23%).
- Consequently, the interest cost on these loans worsens the poor finances of state discoms. Poor finances of the discoms affect their ability to buy power, thus leading to power deficits.
Budgetary support[edit]
After the enactment of Electricity Act 2003 budgetary support to power sector is negligible.[140] State Electricity Boards get initial financial help from Central Government in the event of their unbundling.Human resource development[edit]
Rapid growth of electricity sector in India demands that talent and trained personnel become available as India's new installed capacity adds new jobs. India has initiated the process to rapidly expand energy education in the country, to enable the existing educational institutions to introduce courses related to energy capacity addition, production, operations and maintenance, in their regular curriculum. This initiative includes conventional and renewal energy.A Ministry of Renewal and New Energy announcement claims State Renewable Energy Agencies are being supported to organise short-term training programmes for installation, operation and maintenance and repair of renewable energy systems in such places where intensive RE programme are being implemented. Renewable Energy Chairs have been established in IIT Roorkee and IIT Kharagpur.[90] Central Training Institute Jabalpur is a primer Power Distribution Engineering and Management training Institute.
Education and availability of skilled workers is expected to be a key challenge in India's effort to rapidly expand its electricity sector.
Problems with India's power sector[edit]
India's electricity sector faces many issues. Some are:[47][141][142][143]- Inadequate last mile connectivity is the main problem to supply electricity for all users. The country already has adequate generation and transmission capacity to meet the full demand temporally and spatially.[3] However, due to lack of last-mile link-up with all electricity consumers and reliable power supply (to exceed 99%), many consumers depend on DG sets using costly diesel oil for meeting unavoidable power requirements.[35] Also more than 10 million households are using battery storage UPS as back-up in case of load shedding.[144] India imports nearly US$2 billion worth of battery storage UPS every year.[145] The distribution companies should focus on providing uninterrupted power supply to all the consumers who are using costly DG set's power. This should be achieved by laying separate buried power cables (not to be effected by rain and winds) for emergency power supply in addition to the normal supply lines. Emergency supply power line shall supply power when the normal power supply line is not working. Emergency power supply would be charged at higher price without any subsidy but less than the generation cost from diesel oil. Nearly 80 billion KWh electricity is generated annually in India by DG sets which are consuming nearly 15 million tons of diesel oil.
- Demand build up measures can be initiated to consume the cheaper electricity (average price Rs 2.5 per kWhr) available from the grid instead of running the coal/gas/oil fired captive power plants in various electricity intensive industries.[146][147] The captive power generation capacity by coal/gas/oil fired plants is nearly 47,000 MW mainly established in steel, fertiliser, aluminium, cement, etc. industries.[3] These bulk captive electricity producers can draw cheaper electricity from the grid on short term open access (STOA) basis and avoid the costly imported coal/RLNG/natural gas or utilise these fuels for process purposes instead of electricity generation.[148][149] Some of these idling captive power plants can be used for grid reserve service for earning extra revenue.[150] At present substantial diesel oil is consumed by railways for rail traffic on its non electrified rail lines. To eliminate the substantial cost of imported diesel fuel, power ministry is envisaging to fund the electrification of these lines and achieve additional power demand of 7 billion units.[151]
- No access to electricity: Over 300 million people in India or 60 million households have no access to electricity.[23] Of those who do, almost all find electricity supply intermittent and unreliable.[152] However, many of the power stations are idling for lack of electricity demand. The idling generation capacity can supply three times the domestic electricity needs (nearly 80 billion KWh) of the people who do not have access to electricity.
- A system of cross-subsidization is practiced based on the principle of 'the consumer's ability to pay'. In general, the industrial and commercial consumers subsidize the domestic and agricultural consumers.[153][154] Further, Government giveaways such as free electricity for farmers, partly to curry political favor, have depleted the cash reserves of state-run electricity-distribution system and led them to amassing a debt of ₹2.5 trillion (US$37 billion).[155] This has financially crippled the distribution network, and its ability to pay for purchasing power to meet the demand in the absence of subsidy reimbursement from state governments.[156] This situation has been worsened by state government departments that do not pay their electricity bills.
- Name plate/declared capacity of the many coal fired plants owned by IPPs are overrated above the actual maximum continuous rating (MCR) capacity.[157] The reason for overrating the capacity is to over-invoice the plant cost.[158] These plants operate 15 to 10% below their declared capacity on daily basis and operate rarely at declared capacity. Thus these units are not effectively contributing to the on line spinning reserves to maintain power system / grid stabilization. This is also due to reason that point of connection charges are levied in India based on energy exported instead of MCR capacity as applicable for national grid in UK.
- Intra day load and demand graphs are not made in India at every 15 minutes or less intervals to understand power grid nature and its short comings with respect to grid frequency. These graphs should be plotted with comprehensive data collected from SCADA / on line for all grid connected generating stations (≥ 100 KW) and load data from all substations to impart authenticity to the data presented.[159] Comprehensive list of grid connected power stations along with declared capacity shall be prepared by CEA/POSOCO for all types of power plants (including wind, solar, biomass, co-generation, etc.) and update the data on weekly basis.
- Coal supply: Despite abundant reserves of coal, the country isn't producing enough to feed its power plants. India's monopoly coal producer, state-controlled Coal India, is constrained by primitive mining techniques and is rife with theft and corruption. Poor coal transport infrastructure has worsened these problems. To expand its coal production capacity, Coal India needs to mine new deposits. However, most of India's coal lies under protected forests or designated tribal lands. Any mining activity or land acquisition for infrastructure in these coal-rich areas of India, has been rife with political demonstrations, social activism and public interest litigations. By the end of year 2015, the international coal prices have dropped to US$42.55 per ton which is below the local coal producers sale price. This situation is transforming coastal power station's generation cheaper than pit head power station's generation when electricity is made available to major load centers.[18] Being massive consumer of local and imported coal, India should end the Coal India's coal pricing monopoly and implement coal trading in commodities stock exchange to arrive at market determined coal price on daily basis.[160] This is possible by devising standard coal grades / trading instruments and identifying coal supply hubs in central India, eastern India, west coast and east coast to facilitate trading in imported and local coal.[19]
- Poor pipeline connectivity and infrastructure to harness India's abundant coal bed methane and natural gas potential. The giant new offshore natural gas field has delivered far less gas than claimed causing shortage of natural gas.
- Average transmission, distribution and consumer-level losses exceeding 30% which includes auxiliary power consumption of thermal power stations, fictitious electricity generation by wind generators & independent power producers (IPPs), etc.
- The residential building sector is one of the largest consumers of electricity in India. Continuous urbanization and the growth of population result in increasing power consumption in buildings. Thus, while experts express the huge potential for energy conservation in this sector, the belief still predominates among stakeholders that energy-efficient buildings are more expensive than conventional buildings, which adversely affects the “greening” of the building sector.[161]
- Key implementation challenges for India's electricity sector include new project management and execution, ensuring availability of fuel quantities and qualities, lack of initiative to develop large coal and natural gas resources available in India, land acquisition, environmental clearances at state and central government level, and training of skilled manpower to prevent talent shortages for operating latest technology plants.[162]
- Hydroelectric power projects in India's mountainous north and north east regions have been slowed down by ecological, environmental and rehabilitation controversies, coupled with public interest litigations.
- Theft of power: In India, financial loss due to theft of electricity may be around $16 billion yearly. Populist pro-free power measures also bleed the power companies. Some power companies continue to bleed and lead to bankruptcy due to one of these factors. This also lead to pay more by legal users. This creates a scenario where villages have huge cut of power and simultaneously availability of power in the grid with no purchase by DISCOMs.
- Losses in the connector systems/service connections leading to premature failure of capital equipments like transformers
- India's nuclear power generation potential has been stymied by political activism since the Fukushima disaster. The track record of executing nuclear power plants is also very poor in India[163]
- Lack of clean and reliable energy sources such as electricity is, in part, causing about 800 million people in India to continue using traditional biomass energy sources – namely fuel wood, agricultural waste and livestock dung – for cooking and other domestic needs.[44] Traditional fuel combustion is the primary source of indoor air pollution in India, causes between 300,000 and 400,000 deaths per year and other chronic health issues.
Foreign electricity trade[edit]
India's National Grid is synchronously interconnected to Bhutan, and asynchronously linked with Bangladesh and Nepal.[164] An interconnection with Myanmar,[165] and an undersea interconnection to Sri Lanka (India–Sri Lanka HVDC Interconnection) has also been proposed.Despite low electricity per capita consumption in India, the country is going to achieve surplus electricity generation during the 12th plan (2012 to 2017) period provided its coal production and transport infrastructure is developed adequately.[166][167][168] India has been exporting electricity to Bangladesh and Nepal and importing excess electricity from Bhutan.[169][170] In 2015, Nepal imported 224.21 MW of electric power from India, and Bangladesh imported 500 MW.[171][172]
Bangladesh, Myanmar and Pakistan are producing substantial natural gas and using for electricity generation purpose. Bangladesh, Myanmar and Pakistan produce 55 million cubic metres per day (mcmd), 9 mcmd and 118 mcmd out of which 20 mcmd, 1.4 mcmd and 34 mcmd are consumed for electricity generation respectively.[173][174] Whereas the natural gas production in India is not even adequate to meet its non-electricity requirements.
Bangladesh, Myanmar and Pakistan have proven reserves of 184 billion cubic metres (bcm), 283 bcm and 754 bcm respectively. There is ample opportunity for mutually beneficial trading in energy resources with these countries.[175] India can supply its surplus electricity to Pakistan and Bangladesh in return for the natural gas imports by gas pipe lines. Similarly India can develop on BOOT basis hydro power projects in Bhutan, Nepal and Myanmar. India can also enter into long term power purchase agreements with China for developing the hydro power potential in Brahmaputra river basin of Tibet region. India can also supply its surplus electricity to Sri Lanka by undersea cable link. There is ample trading synergy for India with its neighbouring countries in securing its energy requirements.[176]
Electricity as substitute to imported LPG and kerosene[edit]
The net import of liquefied petroleum gas (LPG) is 6.093 million tons and the domestic consumption is 13.568 million tons with Rs. 41,546 crores subsidy to the domestic consumers in the year 2012-13.[177] The LPG import content is nearly 40% of total consumption in India. The affordable electricity retail tariff (860 Kcal/Kwh at 90% heating efficiency) to replace LPG (lower heating value 11,000 Kcal/Kg at 75% heating efficiency) in domestic cooking is 6.47 Rs/Kwh when the retail price of LPG cylinder is Rs 1000 (without subsidy) with 14.2 kg LPG content. Replacing LPG consumption with electricity reduces its imports substantially.The domestic consumption of kerosene is 7.349 million tons with Rs. 30,151 crores subsidy to the domestic consumers in the year 2012-13. The subsidised retail price of kerosene is 13.69 Rs/litre whereas the export/import price is 48.00 Rs/litre. The affordable electricity retail tariff (860 Kcal/Kwh at 90% heating efficiency) to replace kerosene (lower heating value 8240 Kcal/litre at 75% heating efficiency) in domestic cooking is 6.00 Rs/Kwh when Kerosene retail price is 48 Rs/litre (without subsidy).
In the year 2014-15, the plant load factor (PLF) of coal-fired thermal power stations is only 64.46% whereas these stations can run above 85% PLF comfortably provided there is adequate electricity demand in the country.[178] The additional electricity generation at 85% PLF is nearly 240 billion units which is adequate to replace all the LPG and kerosene consumption in domestic sector.[179] The incremental cost of generating additional electricity is only their coal fuel cost which is less than 3 Rs/Kwh. Enhancing the PLF of coal-fired stations and encouraging domestic electricity consumers to substitute electricity in place of LPG and kerosene in household cooking, would reduce the government subsidies and idle capacity of thermal power stations can be put to use economically. The domestic consumers who are willing to surrender the subsidised LPG/kerosene permits or eligible for subsidized LPG/kerosene permits, may be given free electricity connection and subsidised electricity tariff.[152]
During the year 2014, IPPs are offering to sell solar power below 5.50 Rs/Kwh to feed into the high voltage grid.[180][181] This price is close to affordable electricity tariff for the solar power to replace LPG and Kerosene use (after including subsidy on LPG & Kerosene) in domestic sector.
Electric vehicles[edit]
The retail prices of petrol and diesel are high in India to make electricity driven vehicles more economical as more and more electricity is generated from solar energy in near future without appreciable environmental effects. The retail price of diesel is 53.00 Rs/litre in the year 2012-13. The affordable electricity retail price (860 Kcal/Kwh at 75% input electricity to shaft power efficiency) to replace diesel (lower heating value 8572 Kcal/litre at 40% fuel energy to crank shaft power efficiency) is 9.97 Rs/Kwh. The retail price of petrol is 75.00 Rs/litre in the year 2012-13. The affordable electricity retail price (860 Kcal/Kwh at 75% input electricity to shaft power efficiency) to replace petrol (lower heating value 7693 Kcal/litre at 33% fuel energy to crank shaft power efficiency) is 19.06 Rs/Kwh. In the year 2012-13, India consumed 15.744 million tons petrol and 69.179 millon tons diesel which are mainly produced from imported crude oil at huge foreign exchange out go.[177]Electricity driven vehicles would become popular in future when its energy storage/battery technology becomes more long lasting and maintenance free.[182][183] V2G is also feasible with electricity driven vehicles to contribute for catering the peak load in the electricity grid. Electricity driven vehicles can also be continuously charged with Wireless Electricity Transmission (WET) technology which transmits electricity over 5 km distance without wires to charge devices (mobile and stationary) between the range of 3-12 volts under any weather conditions.[184][185]
Energy reserves[edit]
According to Oil and Gas Journal, India had approximately 38 trillion cubic feet (Tcf) of proven natural gas reserves as of January 2011, world's 26th largest. United States Energy Information Administration estimates that India produced approximately 1.8 Tcf of natural gas in 2010, while consuming roughly 2.3 Tcf of natural gas. The electrical power and fertiliser sectors account for nearly three-quarters of natural gas consumption in India. Natural gas is expected to be an increasingly important component of energy consumption as the country pursues energy resource diversification and overall energy security.[186][187]Until 2008, the majority of India's natural gas production came from the Mumbai High complex in the northwest part of the country. Recent discoveries in the Bay of Bengal have shifted the centre of gravity of Indian natural gas production.
The country already produces some coalbed methane and has major potential to expand this source of cleaner fuel. According to a 2011 Oil and Gas Journal report, India is estimated to have between 600 and 2000 Tcf of shale gas resources (one of the world's largest). Despite its natural resource potential, and an opportunity to create energy industry jobs, India has yet to hold a licensing round for its shale gas blocks. It is not even mentioned in India's central government energy infrastructure or electricity generation plan documents through 2025. The traditional natural gas reserves too have been very slow to develop in India because regulatory burdens and bureaucratic red tape severely limit the country's ability to harness its natural gas resources.[82][141][188]
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