HOW can India generate Power for All?

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AskHow's analysis of the Indian Power sector's performance, and the reasons for bad performance.

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HOW can India generate Power for All?

  1. 1. HOW can we have affordable, 24 hrs Power for All ? ! ! The Analysis
  2. 2. Power for All Where we are? The Analysis With more than 290 million people without access to electricity,! India has the largest unelectrified population in the world.! ! Source: International Energy Agency, 2012 paper on World Energy Outlook
  3. 3. Power for All Where do we want to be? The Analysis The Rural household electrification numbers:! ! ! 43%! 2001 Census 66%! 2010 NSSO ! ! ! ! ! ! ! 100% only in 2023!! HOW can we connect our villages faster? If we can progress at this growth rate we will reach
  4. 4. Power for All The 3 Steps required 1 REACH! While cities and towns connect to the grid,! large parts of the hinterland still do not! ! ! ! ! ! ! ! ! ! The Analysis
  5. 5. Power for All Examining REACH The Analysis THOSE NOT REACHED! are opting to pay Rs 150 - Rs 200 per month to! entrepreneurial ‘Off Grid’(like solar) providers …! ! ! ! ! ! … this is between Rs 8 to 12/unit because they! value the ability to work or study in the evening! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! … and because kerosene and diesel! cost almost twice as much! ! How long can rural India wait for Power?! ! Source: 2 October, 2013 Economic Times article by Biswarup Gooptu
  6. 6. Power for All The 3 Steps required 2 SUPPLY! While some cities have 24 hours of power, ! 12 - 18 hours per day is normal ! for most parts of India! ! ! ! ! ! ! ! ! ! The Analysis
  7. 7. Power for All Examining SUPPLY The Analysis WHY UNDERSUPPLY?! Insufficient Capacity Addition! ! ! + ! ! ! Capacity doubled from 100 to 200 GW, between 2002 to 2012, but there is still 10% to 20% deficit even in major states. International norm: 30% surplus!! How can we add Power Plants? ! Source: Ministry of Power and CEA
  8. 8. Power for All Examining SUPPLY The Analysis WHY UNDERSUPPLY?! Generation Capacity Usage at 60-70%! ! ! ! ! ! Because of Fuel shortage - even though India has 3rd largest coal reserves India is expected be largest coal importer which will increase cost.! How can we supply more Coal to Power Plants?
  9. 9. Power for All Examining SUPPLY The Analysis What about the promise of Alternative Power sources?! ! ! ! ! ! ! Lignite Gas/ Diesel Hydro Nuclear Others Coal 2010 3 13 13 2 5 64 2012 3 12 10 3 5 66 2017 projected 3 9 10 2 6 69 ! ! ! ! … is the current and expected reality.! ! Source: Analysis based on CEA data
  10. 10. Power for All The 3 Steps required The Analysis 3 EFFICIENCY! Since Power is a Natural Monopoly, there is little motivation to be efficient, then! How can we ensure efficiency in a Monopoly environment? ! ! ! ! ! ! ! Raw material! Coal Generation! ! Cost ! Transmission! Cost & Losses Let us examine all the 3 major components of Power
  11. 11. Power for All Examining EFFICIENCY The Analysis Raw Material Coal Monopoly squeeze! ! ! ! ! ! ! ! ! ! Monopoly Transporter, Indian Railways already subsidises coal transport - can it continue to do so as volumes increase? Monopoly Supplier: Coal India, but its costs are half of imported coal - and with imports, costs will rise.! How can we get required volume of coal to plants cheaper?
  12. 12. Power for All Examining EFFICIENCY The Analysis Generation Cost Inefficient Old Plants! ! ! ! ! Over 25% capacity in major states comes from plants over 30 years old (international end-of-life norm). These plants require high maintenance and more fuel, to produce lesser power.! How can we ensure lower costs as old plants are phased out and new capacity is added?
  13. 13. Power for All Examining EFFICIENCY The Analysis Transmission Cost and Losses Decrease Engineering Losses! Decrease Theft! ! ! ! ! ! ! ! ! ! ! Basic physics suggests that as Power for All is rolled out, rural connectivity will mean increase in engineering losses Loss reduction possible with stricter monitoring of compliance and punitive measures against offenders. How can we reduce engineering losses and eliminate power theft?
  14. 14. Power for All Examining Tariffs The Analysis TARIFF Will Industry absorb?! ! ! ! ! Agricultural power almost free, Domestic tariff below cost for most, only Industry pays 30% above cost! If Industry pays more, then cost of goods will rise OR! Industry will move to use of diesel gensets, which makes the distribution companies poorer.
  15. 15. Power for All Examining Tariffs The Analysis TARIFF Unpaid subsidies! ! ! ! ! Subsidy: 20,000 cr paid: 15,000 cr unpaid! When charges to consumers are cut, government has to pay subsidy to Power companies. And when subsidies are unpaid, Power company cannot invest in wires, towers and meters.
  16. 16. Power for All Understanding Tariffs The Analysis All 3 major cost components go up ! as we implement Power for All, so …! ! ! ! ! Raw material! Coal Generation! Cost Transmission! Cost & Losses How can Tariffs for ! Consumers be kept low?! ! ! !
  17. 17. IN CONCLUSION! Please Ask your Lok Sabha candidate ! Ho H ow w w w An w. In As d aly kH ia” sis ple ow o as In n F di ac e s a. eb ea or g ook rch HOW can we reduce engineering losses and ! eliminate theft? for sk m or eA sk HOW can we reduce! tariffs without lowering! investments in education! and health care? “A HOW can we provide ! Power to the villages of ! India at a faster pace? HOW can we supply! more coal cheaply to ! Power plants?

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