Changing global scenario of the utility business Himadri Banerji CEO RELIANCE ENERGY

Energy business Model - Transition from regulated to free market Legislative acts and laws through huge bureaucracy Strict controls on quantity, technology, capital structure, imports etc. Resulted in insulated industry, no competition, slow innovation, poor quality and high cost Now moving towards a free market system

Legislative acts and laws through huge bureaucracy

Strict controls on quantity, technology, capital structure, imports etc.

Resulted in insulated industry, no competition, slow innovation, poor quality and high cost

Now moving towards a free market system

Generation EHV Transmission EHV Substations Power Transformers Contd... Existing Integrated Utility Structure (1)

Power Transformer 11KV Network Dist.Transformers Starting of LV Network HT Capacitor HT Consumers Contd... Existing Integrated Utility Structure (2)

LV Capacitor Fuse Section Pillar Mini Section Pillar COMMERCIAL INDUSTRIAL LV Cable Network RESIDENTIAL Metering System Existing Integrated Utility Structure (3)

Market innovations Global market growing towards retail sales. (Electricity pools). Open access to transmission system Emergence of power marketers who are buying cheap surplus capacities of utilities and selling at high price to areas of demand. Tele-marketing of power by power marketers is also becoming the order of the day. Forward and future contracts

Global market growing towards retail sales. (Electricity pools).

Open access to transmission system

Emergence of power marketers who are buying cheap surplus capacities of utilities and selling at high price to areas of demand.

Tele-marketing of power by power marketers is also becoming the order of the day.

Forward and future contracts

More than just a low-cost provider They want someone who will help them deal with the future The energy provider needs to enable them to access the best in terms of technology, personalized service, reliability, and cost-effectiveness Customer Survey Results

More than just a low-cost provider

They want someone who will help them deal with the future

The energy provider needs to enable them to access the best in terms of technology, personalized service, reliability, and cost-effectiveness

Market Forces Demand for clean, reliable, quality power at affordable cost Pressure from proactive consumers, dynamic consumer forums and strong environmental lobbies. Encouragement to captive power generation left utilities with heavy swinging loads with poor load factor Tariff revision becomes difficult and introduction of performance based optional tariff structure Focus shifting from “Reactive” sales culture to “Proactive” sales culture.

Demand for clean, reliable, quality power at affordable cost

Pressure from proactive consumers, dynamic consumer forums and strong environmental lobbies.

Encouragement to captive power generation left utilities with heavy swinging loads with poor load factor

Tariff revision becomes difficult and introduction of performance based optional tariff structure

Focus shifting from “Reactive” sales culture to “Proactive” sales culture.

Energy Business : Imperatives Till yesterday: monopolistic, cost-plus & promoted in-efficiencies To install physical plants To serve the customers within franchise area To meet the regulatory requirements Returns based on physical assets installed Commodity prices determined by regulators Now onwards : Competitive, price driven with incentive on efficiency Customers choose suppliers Easy entry / exit for suppliers Selectivity of interested areas of operations Regulators imposes checks and balances

Till yesterday: monopolistic, cost-plus & promoted in-efficiencies

To install physical plants

To serve the customers within franchise area

To meet the regulatory requirements

Returns based on physical assets installed

Commodity prices determined by regulators

Now onwards : Competitive, price driven with incentive on efficiency

Customers choose suppliers

Easy entry / exit for suppliers

Selectivity of interested areas of operations

Regulators imposes checks and balances

Energy Business : Changes in business Models The international electricity business is undergoing very deep rooted changes, moving towards unregulated electricity destiny Deregulation, competition and environmental issues are posing serious challenges The structure of central power station and T&D system is undergoing revolutionary changes. Unbundling to generators, transmission system operators & distribution companies Constant pressures from customers for performance enhancement, reduce costs, improve quality of power, meeting stricter emission norms.

The international electricity business is undergoing very deep rooted changes,

moving towards unregulated electricity destiny

Deregulation, competition and environmental issues are posing serious challenges

The structure of central power station and T&D system is undergoing revolutionary changes.

Unbundling to generators, transmission system operators & distribution companies

Constant pressures from customers for performance enhancement, reduce costs, improve quality of power, meeting stricter emission norms.

New Utility Business Model Regulator Generators Transmission Utility Grid operators National Grid Distribution Consumers

Challenges to utilities Imperatives to adopt clean, environment friendly technologies in generation Adopt technologies to reduce T & D Losses - Improvement in business performance with reduction in green house gas emission Improvement in reliability and quality of power Improve customer services especially accuracy in billing and ability to service billing and supply related complaints Leveraging utility infrastructure

Imperatives to adopt clean, environment friendly technologies in generation

Adopt technologies to reduce T & D Losses - Improvement in business performance with reduction in green house gas emission

Improvement in reliability and quality of power

Improve customer services especially accuracy in billing and ability to service billing and supply related complaints

Leveraging utility infrastructure

Turn challenges into opportunities to gather Market intelligence Knowledge about customers Competitors Market forces Internal capabilities Changes in Business processes Move from technology to solutions End-to-end information supply chain emerging - “Deliver the right information to the right user at the right time” rather than “ Provide all information to everyone” Utilities need to invest heavily in the processes and technologies that keep them focused on their customers’ value .

to gather Market intelligence

Knowledge about customers

Competitors

Market forces

Internal capabilities

Changes in Business processes

Move from technology to solutions

End-to-end information supply chain emerging - “Deliver the right information to the right user at the right time” rather than “ Provide all information to everyone”

Utilities need to invest heavily in the processes and technologies that keep them focused on their customers’ value .

Opportunities to utilities in developing countries Will experience acute increased energy need due to escalating population & economic expansions. Per capita consumption is five times lower in China & 10 times lower in India compared to western Europe. Growth will be focused in these countries especially in cities primarily in Asia & South America. Carbon trading

Will experience acute increased energy need due to escalating population & economic expansions.

Per capita consumption is five times lower in China & 10 times lower in India compared to western Europe.

Growth will be focused in these countries especially in cities primarily in Asia & South America.

Carbon trading

Utilities Leverages their strength to expand their business in other areas

Scottish Power Plc., UK Total Turnover : US $ 5 Billion Scottish power & Royal Bank of Scotland are to team up to offer customers an all-in-one service bundling utilities, telephone, internet, insurance and banking

Vivendi, France Total Turnover : US $ 37Billion Besides telecom, business areas include range of audio-visual services such as television broadcasting, cable / multimedia and film distribution

Suez Lyonnaise Des Faux, Belgium Total Turnover : US $ 37Billion

CMS Energy, USA Total Turnover : US $ 6 Billion

Leveraging infrastructure

Next generation home appliances :

Utility Investment trends World production is set to rise from 13 Million to 20 million GWH and installed capacity will rise from 2000 to 3600 GW in next 25 years. Also there will be a requirement to replace 50% of existing generating capacity. That means 75% of capacity requirement of year 2020 is yet to be built up.

World production is set to rise from 13 Million to 20 million GWH and installed capacity will rise from 2000 to 3600 GW in next 25 years.

Also there will be a requirement to replace 50% of existing generating capacity.

That means 75% of capacity requirement of year 2020 is yet to be built up.

Utility Investment trends… UHV and EHV AC / DC transmission system to match above capacity will need to be built up. Interconnections between national grids with HVDC link allowing independent controls on voltages and frequencies, yet allowing bulk power to be exchanged between nations

UHV and EHV AC / DC transmission system to match above capacity will need to be built up.

Interconnections between national grids with HVDC link

allowing independent controls on voltages and frequencies,

yet allowing bulk power to be exchanged between nations

Technology trends Generation

Generation Average efficiency of Coal fired plant ~ 25 to 38% Gas fired power station ~ 60% Need to improve the overall efficiency of coal fired plant Efforts are on to develop new, high efficiency combustion systems using clean coal technologies Aims to develop coal fired plant with thermal efficiency greater than 50%

Average efficiency of Coal fired plant ~ 25 to 38%

Gas fired power station ~ 60%

Need to improve the overall efficiency of coal fired plant

Efforts are on to develop new, high efficiency combustion systems using clean coal technologies

Aims to develop coal fired plant with thermal efficiency greater than 50%

Drivers for generation technology Cheap Clean Distributed Peaking

Cheap

Clean

Distributed

Peaking

Technology trends in generation Clean Coal technology CFBC IGCC PF+FGD Low NOX High efficiency combined cycle plants with efficiencies crossing 60% Renewable energy technologies Solar Photovoltaic Wind power Micro-turbines, fuel cells, distributed generation etc.

Clean Coal technology

CFBC

IGCC

PF+FGD

Low NOX

High efficiency combined cycle plants with efficiencies crossing 60%

Renewable energy technologies

Solar

Photovoltaic

Wind power

Micro-turbines, fuel cells, distributed generation etc.

Fuel Cells For energy storage Operates like giant rechargeable batteries Stores energy when demand & costs are low and releases when demand & prices are high Flattening of load curve - Better utilization of plant capacity Removing the needs to call up more extensive power plants to meet the system peak Effective use of intermittent renewable sources of energy like wind & solar

For energy storage

Operates like giant rechargeable batteries

Stores energy when demand & costs are low and releases when demand & prices are high

Flattening of load curve - Better utilization of plant capacity

Removing the needs to call up more extensive power plants to meet the system peak

Effective use of intermittent renewable sources of energy like wind & solar

Fuel cells

Regynesys from National Power -UK

Transmission of Bulk power Trends

Flexible AC Transmission System In-built power flow controllers High power semiconductors are used to generate a precisely controlled voltage Control of active and reactive power flow Eliminates the needs of large AC inductors / capacitance & Large substation area High speed response Optimal utilization of transmission lines

In-built power flow controllers

High power semiconductors are used to generate a precisely controlled voltage

Control of active and reactive power flow

Eliminates the needs of large AC inductors / capacitance & Large substation area

High speed response

Optimal utilization of transmission lines

EHV / HV Urban Utility Networks Availability of Space Transmission as near as load to improve reliability and T & D Loss

Availability of Space

Transmission as near as load to improve reliability and T & D Loss

AIS vs GIS Compact Total flexibility can be located near the load centres Allow more efficient network Reliability Outages Integration with existing stations

Compact

Total flexibility

can be located near the load centres

Allow more efficient network

Reliability

Outages

Integration with existing stations

Distribution Network Management Distribution Network Management Network Planning Business Management Primary electrical components Selective protection Topology design Loss calculation Energy balance calculations Energy trading Energy contracting Energy forecasting Investment calculations Distribution Automation (DA)

Primary electrical components

Selective protection

Topology design

Loss calculation

Energy balance calculations

Energy trading

Energy contracting

Energy forecasting

Investment calculations

Distribution Automation Transmission automation Distribution automation Control center Control center Substation automation

Metering Management System Automatic meter reading Data storage / Evaluation / Reporting Tariff control / Real time pricing Planning and maintenance

Automatic meter reading

Data storage / Evaluation / Reporting

Tariff control / Real time pricing

Planning and maintenance

Integration in Automation Customers affected Substation SCADA Customer Customer Service Sales Accounting Control Center Engineering Asset Management Repair and Maintenance Reports Type of disturbance / Time to recover / No. of customers affected Reports Asset records Disturbance information Disturbance report Work Order Fault statistics Spares Real-time information Disturbance records

SCADA/DMS - GIS , a birds’ eye view Geographical info, Schematic diagram availability at central location addresses key operational concerns This ultimately leads to improvement in System Safety, Efficiency and Customer Service (Power Quality and Reliability)

Application systems for Utilities Network Planning Business Management Products, systems and services for Network Control Systems Load Management Systems Substation Monitoring Systems Substation Automation Distribution Management Systems Metering Management Systems

Network Planning

Business Management

Products, systems and

services for

Network Control Systems

Load Management Systems

Substation Monitoring Systems

Substation Automation

Distribution Management Systems

Metering Management Systems

Substation monitoring system Substations Substation configuration and monitoring Relay setting and management Condition monitoring System maintenance and optimization System analysis Lower entry level for Substation Automation separate user privileges for various user groups

Substation configuration and monitoring

Relay setting and management

Condition monitoring

System maintenance and optimization

System analysis

Lower entry level for Substation Automation

separate user privileges for various user groups

Communication Radio systems Power and distribution line carrier Electrical telecom cables Fiber optic cables Transmitter Receiver Transmitter Receiver

Automatic Meter reading Reading of meter remotely Use of communication medium or wireless Implemented at AEC On line monitoring and network control

Reading of meter remotely

Use of communication medium or wireless

Implemented at AEC

On line monitoring and network control

Geographical Information System

Major issues confronting utilities today Distribution of existing data across various sites Demand & constraints vs manual method of maintaining data Size of database, its maintenance, updating and archival Integration of data with other utility systems like SCADA,SAP, DMS, ICCUS etc.

Distribution of existing data across various sites

Demand & constraints vs manual method of maintaining data

Size of database, its maintenance, updating and archival

Integration of data with other utility systems like SCADA,SAP, DMS, ICCUS etc.

Problem with manual system Physical condition of the documents High cost to maintain Duplication of records leading to…. Confusion over official records Inaccuracy of the data Time consuming effort for updating Difficulty of keeping data current Lack of easy access

Physical condition of the documents

High cost to maintain

Duplication of records leading to….

Confusion over official records

Inaccuracy of the data

Time consuming effort for updating

Difficulty of keeping data current

Lack of easy access

What is GIS?

GIS in Delhi

GIS for utilities

Capabilities of GIS & Mapping system Information Management Graphic Output Network Modelling AM / FM & Mapping System Intelligent Mapping Engineering Analysis Maintenance of Facilities Database Integration with Non-spatial database

Benefits of AM/FM System Asset management Reduce the cost of maintenance No physical maps to deteriorate Integrate operations New capabilities Streamline the database across the organization

Asset management

Reduce the cost of maintenance

No physical maps to deteriorate

Integrate operations

New capabilities

Streamline the database across the organization

Global Positioning System

Global Positioning System (GPS) Satellite based radio navigation system Developed and operated by US DOD To determine three dimensional position (Longitude, latitude and altitude), velocity and time Highest precision and accuracy 24 Operational satellites in 6 orbits at 20,200 Kms above the earth Minimum six satellites in view to users anywhere in the world

Satellite based radio navigation system

Developed and operated by US DOD

To determine three dimensional position (Longitude, latitude and altitude), velocity and time

Highest precision and accuracy

24 Operational satellites in 6 orbits at 20,200 Kms above the earth

Minimum six satellites in view to users anywhere in the world

GPS System

How GPS Works ?

Who uses GPS? Land, sea and airborne navigation, surveying, geographical exploration, mapping, vehicle location system, time synchronization etc.

Thank You The future’s not ours to see