- Electricity Scenario: India
- Problem with hydro power
- Coal Based Electricity Generation
- What was the reason behind grid failure?
- What is an electrical grid?
- Components of a grid
- When does a grid collapse?
- Penalty for Grid violation
- What is the network in India like?
- Players in the game
- Suggest the reforms to fix Electricity problems in India
Because of the Grid failure, last month about half of India or roughly 10 per cent of the world’s population, suddenly found they had no electricity.
Electricity is the life line for Manufacturing and Service sector. If India wishes to grow at 8 or 9% a year, then smooth and uninterrupted supply of electricity =essential.
Electricity Scenario: India
- India’s present installed electricity capacity is 205 gigawatts (1GW is 1,000MW).
- Per capita electricity consumption in China is about 3.5 times that of India. [ If a country’s electricity, cement or steel consumption is higher than India, it means means they’re more advanced and Developed than we are].
- Hydro and coal account for nearly 77 per cent of electricity generation in India.
Problem with hydro power
- hydro power contributes to only about 20 per cent of electricity generation in India, while in China- the Three Gorges dam alone satisfies 10% of China’s electricity consumption.
- Only about one-fourth (25%) of the India hydro potential has been harnessed. Why?
- Lack of vision,
- social and environmental activism of Jholaachhap NGOs.
- slow decision-making
- Weak law-enforcement. (the whole naxal belt- Government cannot start any projects there)
- We’ve huge potential of hydro power generation in Arunanchal Pradesh but most of the projects are stalled due to Border disputes with China. (lack of political will.)
Coal Based Electricity Generation
- Coal accounts for more than half of India’s electricity generation.
- country has the world’s fifth largest reserve of coal but its quality is poor because of very high ash content.
- Coal India has not been increasing production fast enough.
- Compared to China’s exponentially increasing output, Indian production has remained almost stationary during the past two years.
- Existing mines have strict limits as to how much coal they can extract.
- New mines are difficult to open because of the trouble in obtaining environmental and land clearances.
What was the reason behind grid failure?
- The national electricity transmission network links up India’s five regional grids.
- some states used more than their quota of power from this network.
- Why? Because of the low monsoon, farmers were using more electricity to pump out more ground water.
- So this extra demand of electricity overburdened the system, causing a cascade of failures.
- To cut the burden, power plants were shut down, some automatically because of computer softwares.
Here goes some technical details
What is an electrical grid?
- grid is an interconnected network of transmission lines : on one hand it has Generating station and on the other hand it has load centres.
generating stations |
|
load centres or distribution companies |
|
- For an electricity grid to function smoothly, it is essential that load and generation must be balanced at all times to prevent a failure.
- The flow of electricity through the lines should ideally not exceed the rated capacity, otherwise the lines could trip due to an overload.
Components of a grid
- A grid consists of three main components:
power stations | produce electricity from fossil fuels (coal, gas) or non-combustible fuels (hydro, nuclear, wind, solar); |
transmission lines | carry electricity from power plants to demand centers |
Transformers | reduce the voltage so that distribution lines carry power for final delivery. |
When does a grid collapse?
- There can be two main reasons.
- First reason: equipment failure due to reasons such as fog and pollution
- Second reason: when one or more constituents violate the grid code and overdraw in a big way from the grid, causing it to fail due to the imbalance in the power injection
- Northern states are repeat violators of the grid frequency norms, especially Uttar Pradesh, Haryana, Punjab, Jammu and Kashmir.
Penalty for Grid violation
- If a state draws more electricity than its quota, then it has to pay penalty known as “Unscheduled Interchange or UI rate.”
- Uttar Pradesh is the repeat offender of grid violation, it has ‘UI’ penalty bills of several hundred crores and delays the payments. The state has also taken advantage of a High Court order under which it does not pay the full UI penal rate.
What is the network in India like?
- At present the northern, western, eastern and northeastern regions are integrally connected through AC (alternating current) transmission links to form what is called the ‘NEW’ grid.
Players in the game
Private players
- Few years back, (when there was no recession in US and call centres were booming), the private players thought that India’s middle class will grow exponentially, and everyone will buy TVs, fridge, washing machine and computers. Thus demand of electricity will increase and we could make heavy bucks. So many private players (like Anil Ambani), entered the game and opened their thermal power stations.
Problems faced by private players in power market
- electricity-generating companies in the private sector do not get enough coal from Coal India, or get the Indian Railways to transport it in time.
- And They cannot import lot of coal from abroad (Australia) because it is expensive and Government controls the electricity prices, so they cannot pass on the cost of import to the final consumers.
- Thus industrialists have started reduced long-term investment in new plants. Some of them had taken loans from Banks and now showing inability to repay the loan on time, so banks are also feeling the heat. And adding insult to the injury, Less electricity = expensive electricity = low IIP, low GDP, high WPI and CPI.
Coal India
- it is the Government controlled mining company that has monopoly over digging up coal through out India.
- Environmental clearance : can’t dig enough coals from jungles.
- Coal India has $11 billion of unused cash, but reinvests only about 20 per cent of its gross cash flow into research and Development (R&D).
- So its coal processing capacity, machinery etc. are not up to the mark according to international standards.
- Technology and management practices in mining and transportation are outdated.
- Management is weak because of strong trade unions [just like Air India] and the system is rife with corruption. [just like MNREGA]
Local Electricity companies
- Most local distribution firms are state-owned and all but bankrupt, as local politicians insist that tariffs stay low and that juntaa especially farmers, get free power- especially during the election year. And given India’s polity, we’ve elections round the year- in this state or that state. So there is no “dry” year, in which Government can take tough non-populist measures.
- Lack of modernisation, poor operation and maintenance practices and pilferage (stealing of electricity) ensure that 30-40 per cent of electricity generated is lost and do not produce any revenue.
Farmers
- Farmers get free power to pump groundwater for irrigation, but some of this free power is illegally diverted to factories.
- Since electricity is free, farmers run their pumps whether or not crops require water. As a result, groundwater levels in many states are declining by over 1 metre every year.
- This means each year, farmers have to use more electricity to pump water from increasing depths,
- Secondly, when ground water table decreases, the soil becomes more saline. And saline soil produces less crop. Combine this with Deforestation and soil erosion= farmers are forced to use more and more fertilizers to produce same amount of crop.
- So, in the end this becomes a vicious cycle of excessive electricity and fertilizer use.
Suggest the reforms to fix Electricity problems in India
- Privatize Coal India.
- install new electricity regulator with teeth. (just like SEBI is for capital markets.)
- Install nuke power stations, disregarding the protests by jholaachhap NGOs and their foreign masters.
- Sort out border disputes with China, so that Arunanchal Pradesh’s hydro potential can be fully utilized.
- Your suggestions also welcome.
@sonalika
my 2 cents…
reducing T&D losses is a must…as per the western practise..spending on T&D is equal to spending on generation whereas in India T&D spending is just 10% of generation. that means our policies arent focussed well on T&D. and this is one of the reason for state discoms under huge debts besides their inefficient administration. has led to steep increase in NPAs os PSB as well.
also transmission at high voltage reduces the losses..but setting up of sub stations for that sort of transmission is expensive and mostly european and american companies has got hold over that technology.
Though India has set up few lines on high voltage..but there is lack of technology transfer..so we are dependent on them and makes it financially un viable for us….
It is called HVDC transmission. The two major companies in this field are Siemens and the market leader ABB. These companies have been investing and researching on these technology for decades. Also now there are more than two companies offering high voltage portfolios so the companies have to win the bid. Also the savings earned through the investment are manifold compared to the investment. So financially unviable is nto true.These companies have an indian arm executing projects in India. So lack of tech transfer does not come into picture. No company gives its technology. and even if given these technologies cannot be reproduced just like that… The most important and easy step for India to do would be invest in replacing the old inefficient transformers and then try to invest in high voltage lines…
Very nice and informative article.
Hi Mrunal,
A lucid description indeed!!!..just had a thought,, whether NRLDC(National regional load dispatch center can also be made proactive in order to prevent grid failures since it monitors the load drawn by states on a realtime basis…
Frontline edition has a nice article on the reasons for Power grid failure which it says is not due to grid indiscipline on behalf of states like Haryana(Which happens often) but due to lack of regulations at LDC’s. Check out.
1.India should encourage FDI more in infrastructure and there should be partial privitizaton of electricity boards with regulations on tariffs.
2.There should be a limit on subsidized electricity and a fixed quota for farmers (except BPL).
3.There should be a gradual phasing out of 100WT bulbs and replacing these with more efficient CFLs.
4.Interlinking of rivers ( by making canals through interlinked system dependence on electricity by farmers can be reduced)
5.Large amount of electricity is wasted through transmission and distribution losses.It can improved by investing more in infrastructure.
1.The proposed NIB(NATIONAL INVESTMENT BOARD) for infrastructure projects to avoid delay in clearance (Without violating Forest Rights Act and Panchayat Acts(PESA)) will help a great way,but it should not favour corporate interests over common interests.
2. Time zone of India can be changed by 0:30 hours as it will help in more day light saving in INDIA(SPECIALLY NORTH EAST) as it will increase productivity (also because during evening people use more electricty for lightning ,people will go to BED early and there will less consumption)
Last but not least,There should be incentives for industries or individuals like done in carbon trading as it will promote minimum usage with efficiency.
I wonder like all states in India, Gujarat must have been facing the issues of low coal supply,less nuke plants,priliferage etc. but Gujarat still manages to supply power 24*7 to atleast 90% of the state .
Interestingly , they were ready to support the Northern states during North grid failure this year .
I believe when Gujarat can do it rest of India can also do it inspite of the problems they have,we need strong political will to address the power issues.
Suggestions to fix Electricity problems in India
1 Encourage BEE efficient electrical appliances
2 Check on electricity theft
3 Hydro-electric plans to be encouraged