Electrical Monitor
 

We have prepared our Smart Grid roadmap for the next ten years

Venugopal PillaiFriday, November 29, 2013, 15:39 Hrs  [IST]

Praveer Sinha—Praveer Sinha, CEO & Executive Director, Tata Power Delhi Distribution Ltd

Tata Power Delhi Distribution Ltd (Tata Power-DDL) is perhaps India’s most successful story in private power distribution. Taking over key areas from erstwhile Delhi Vidyut Board in 2002, Tata Power-DDL has not just transformed but practically redefined power distribution in Delhi. In this exclusive interaction, Praveer Sinha takes us through the transformation and how Tata Power–DDL is gearing up to future demand. Sinha also shares how Tata Power-DDL could be the pioneer of commercial Smart Grid in India. An interview by Venugopal Pillai.

Tata Power Delhi Distribution is amongst India’s earliest case of power distribution privatization. Tell us in brief the positive changes that have accrued due to the privatization?
Tata Power Delhi Distribution is one of India’s most remarkable success stories in public-private partnerships. A joint venture carved out of the government-owned loss making power distribution company, Delhi Vidyut Board, we have indeed come a long way in the decade of our existence.

We feel that Tata Power-DDL has been very instrumental in enhancing quality of life of its consumers and has become synonymous with the ‘efficient power distribution reforms’ in the country.

Tata Power-DDL has reduced Aggregate Technical & Commercial (AT&C) losses in its area of supply in north, north west Delhi from 53 per cent in July 2002 to just 10.78 per cent by end of FY13, thereby generating additional revenues to the tune of around Rs.10,300 crore for the benefit of the consumers.

This amount has been utilized for meeting increasing input costs (mainly power purchase) which would otherwise have been required to be funded either by the Government of Delhi (by way of equivalent subsidy) or through revision of tariffs.

Prior to privatization of DVB, the Delhi government was funding power sector deficit of Rs.2,000 crore annually, which has reduced to Rs.200 crore, thereby releasing these funds for the state government to deploy resources in citizen welfare measures like and other infrastructural schemes such as new roads, flyovers, metro etc.

Tata-Power-DDLTell us about your backward integration in power generation.
Yes, we are also the only distribution utility (formed out of the reforms process) to have undertaken backward integration into generation by establishing a 90-mw gas-based combined cycle power project at Rithala in North Delhi. The project is aimed at augmenting power supply to our consumers to partially meet their demand and to enable uninterrupted supply to critical/emergency services like hospitals, fire stations, etc. during any grid collapse, by ensuring islanding.

Give us a broad idea of the Tata Power-DDL’s current command area in terms of geographical area, number of consumers, electricity supplied, etc.
When power distribution in Delhi was privatized in 2002, Tata Power-DDL (then known as North Delhi Power Ltd) was handed over the north and north-west area of Delhi which is spread over 510 sq km. Today, Tata Power-DDL serves a consumers base of 1.35 million and population base of 6.0 million with annual energy requirement of 7,762 MU. In FY13 the peak load met by us has gone up to 1,573 mw as against 930 mw in 2002. We have a mix of slum clusters, residential colonies, big commercial complexes and industrial units in our licensed area.

What is the envisaged demand in Tata Power Delhi Distribution’s area over the next five years, and how are you gearing up to meet the same?
Tata Power Delhi Distribution has witnessed a CAGR growth of 5 per cent in its energy requirements and 8.5 per cent in peak demand during the previous 6-7 years. Considering the same, the energy requirement and demand of Tata Power Delhi Distribution are estimated to be around 9,900 MUs and 2,365 mw, respectively.

In order to continue meeting the growing demand of its consumers, Tata Power Delhi Distribution has entered into long term PPAs with various generating stations to ensure energy security of its operational area. In case of any additional requirement of power, we will source the same through competitive route ensuring the best possible cost for its consumers. Additionally, we are simultaneously revamping its distribution infrastructure through addition of suitable transformation capacity and commissioning of new grid substations to enable uninterrupted flow of power to consumers.

Tata-Power-DDLWe feel that India has not achieved the desired success in its endeavor to privatize power distribution. What is your view?

Distribution of power is the final and most crucial link in the power sector's value chain but, unfortunately, the weakest in our country. Economic viability of this segment has major ramifications on the viability of the entire sector as further investment in generation and transmission sectors is only possible if the distribution segment is financially viable and healthy.

The AT&C losses in India continue to be one of the highest across the globe. Any increase in generation capacity is more than offset by inefficiencies and wastage at each stage—production, transmission, distribution and delivery. The need of the hour is to build a sustainable distribution reforms model which shall ensure continued viability of the sector.

Despite the success of Delhi privatization model, no other state has ventured to replicate the same till date. Some states have gone in for franchisee model, which seems like a half-baked effort towards carrying out distribution reforms. The sole bidding criteria of maximizing incumbent licensee’s revenues by way of highest input rate in a franchisee model—together with short tenure of franchise of 10-15 years—gives a wrong economic signal to franchisee to focus mainly on commercial loss reduction so as to minimize long term investments in capex. This sidelines reliability-related capital investments.

Franchisee is unlikely to invest in any long-lead technological upgrade like SCADA, GIS or AMR as its benefits may accrue after the franchise period, with no or little benefit flowing to the franchisee during its tenure. Further, the model insulates the franchisee from regulatory oversight which is critical in this monopolistic business as the regulator is also a custodian of the consumer’s interest.

Given the drawbacks of the franchisee model, it is suggested that the licensee model through the PPP model should be preferred. This is more inclusive and addresses expectations of all stakeholders involved.

Untitled Document
Turnaround Performance Summary
Parameter
Unit
Jul-02
Mar-13
Operational Performance
AT&C Losses
%
53.10
10.78
System Reliability
%
70.00
99.94
Transformer Failure Rate
%
11.00
0.79
Length of Network
ckt km
6,750
10,364
Street Light Functionality
%
40.00
99.57
Power Transformation Capacity
MVA
1,730
3,329
Distribution Transformation Capacity
MVA
1,926
4,742
Consumer Related Performance
New Connection Energization Time
Days
51.8
6.0
Meter Replacement Time
Days
25
6
Provisional Billing
%
15
3
Defective Bills
%
6.0
0.2
Bill Complaint Resolution
Days
45
6
Mean Time to Repair Faults
Hours
11
1.2
Call Center Performance - Service Level
%
-
91
Payment Collection Avenues
Nos
20
5,377
Consumer Satisfaction Index
%
-
88

Do you anticipate that “Time of Day” metering that, as we understand, is being implemented on pilot basis in Delhi could be commercially deployed at least in some privatized distribution circles in India?
My answer will be in affirmation! ToD Metering has been, in the recent tariff order, approved for those consuming 100KW and above.

Today, Tata Power Delhi Distribution has around 2,200 consumers where ToD metering has been implemented. Simultaneously, we are gearing up to provide this service for 10KW-plus consumers. ToD metering is financially a win-win solution for both utility and consumers. Looking at current challenge posed by utility in terms of optimizing power purchase cost by flattening the peak power curve to a large extent. Thereby, it will reduce the cost burden on both utilities and consumers. I am of the view that any power utility, be it private or public, is equipped to handle ToD metering provided the meters in use are electronic and have built-in ToD metering features. ToD is definitely a viable solution from both utility and consumer’s point of view.

Time of Day metering is essential in today’s context as it shall reflect the true cost of power that people are consuming at different hours of the day and shall usher in demand side management at a significant pace. Further, different tariffs at peak times shall provide an economic signal to developers to set up peaking capacities in the country which are needed as India is heading towards excess base-load capacity generation with negligible peak generation capacities to support the peak surges.

Tell us in particular about measures that Tata Power Delhi Distribution has been taking to introduce Smart Grid-like features to its command area?

In 2003, Tata Power Delhi Distribution made its first ten-year technology roadmap. As part of this, we implemented different technologies like SCADA, GIS, Distribution Management System (DMS), Distribution Automation (DA), most of the components of SAP including SAP-ISU and latest being Outage Management System (OMS). The technologies we have implemented till date form a large part of the Smart Grid technologies and are predominately operative in developed economies like USA, Europe, Singapore, etc. Tata Power Delhi Distribution is also the founding member of Smart Grid Maturity Model (SGMM), whose rights now rests with Carnegie Melon (SEI).

We have also initiated a ‘Smart Grid and Automated Demand Response pilot’ in association with IBM, which is probably one of a kind in the country. The objective of the pilot is to evaluate integration of infirm renewable power with the grid, reduction in losses through automatic disconnection, enhanced reliability through self- healing systems and empowerment of consumers in managing their demand based on real time information of load and prevailing tariffs.

At Tata Power Delhi Distribution, we have made it a point to ensure integration between different technologies to ensure optimum mileage. Many of these technologies are still to be implemented in the Indian distribution sector either partially or fully.

India has begun taking early steps in its Smart Grid aspirations. What are the major challenges that you envisage? The Indian distribution sector mostly comprises of state utilities or government players, there are very few like Tata Power Delhi Distribution, who operate under a PPP model. The level of maturity varies grossly across these utilities as their performance varies state to state, which includes level of technology implementation, adoption and process orientation. Formulation of policies, identification of these ever-evolving technologies, developing business cases when there is insufficient or inaccurate data to justify capital investment, deployment of these technologies, reaping benefits when there is a shortage of capability, lack of understanding of various performance parameters and how to measure them in the right way will be few challenges.

Tata-Power-DDLGiven that Smart Grid refers to a very broad architecture, what are the actual elements of Smart Grid that you see India implementing over the next ten years or so?
As far as India is concerned, we have seen attempt from the government to bring in technology for improving performance in form of R-APRDP, which will see some of the utilities in a limited way (as all cities, towns and rural belts are not covered under the scheme) introduce some of the technologies like SCADA, GIS etc, which we have already done. The 14 Smart Grid pilot projects would hopefully facilitate some of the next level technologies like AMI, OMS etc. As far as Tata Power Delhi Distribution is concerned, we have developed, as earlier discussed, our Smart Grid roadmap for the next ten years which makes us perhaps first in the country to have one.

Some of the technologies we will be scaling up in the near future would include Advanced Metering Infrastructure (AMI), Auto Demand Response (ADR), Enterprise Service Bus (ESB), Field Force Automation (FFA) also we will be introducing high end Business Analytics and Intelligence in our systems. As a continuous process we will be refreshing and upgrading our existing technologies also with the requirements of the changing times. As part of our commitment to the environment and climate change we will be increasing our renewable generation especially rooftop solar to meet the peak load requirement in summer months. Apart from this, we will be introducing more technologies related to renewables, its storage, on one off grid usage etc.

Please discuss your key growth plans for the next five years.

Having substantially improved the operational and consumer service delivery to benchmark levels as was the main mandate for this public-private initiative in Delhi. Tata Power Delhi Distribution recognized the need to foray out of the licensed area, to leverage its domain expertise in improvement of the power sector as a whole and also to provide challenging opportunities to its employees.

With the above strategy in mind, Tata Power Delhi Distribution has forayed into power distribution-related consultancies both nationally as well as internationally in the areas of AT&C loss reduction, automation & IT implementation, business process reengineering, distribution management, project management and change management. Tata Power Delhi Distribution is a pioneer partner of the GoI’s R-APDRP and NEP initiative and is acting as an IT, SCADA and project management consultant for many distribution utilities in India such as Haryana, Uttar Pradesh etc.

We have also bagged consultancy project in Nigeria distribution and is pursuing consultancy assignments in countries like Kurdistan, Turkey, Iraq in areas of distribution reforms, IT, SCADA, GIS etc. We hope to enhance our footprints both at the national and international levels which will go a long way in meeting the growth aspirations of our employees as well. In addition to this, Tata Power Delhi Distribution is also working towards expanding its consumer base in remaining Delhi and NCR under Open Access framework.

 
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