You want numbers...here they are!!
This is one of the blogs that I wrote just after completing my MBA and never published it..Another example of how so much numbers make any article un-interesting..here is the one about my favorite topic..Power sector in India. The numbers are very interesting for any one concerned about the sector!
Power sector reforms started off in 1991. But during the eighth 5 year plan the target for the power sector is scaled down from 48000 MW to 20,729 MW on the ground of resource constraints. And the actual became only 16,422 MW.
The amendments are done to the existing Acts and Rules to woo the private and foreign companies to invest in this sector. The private companies are provided a 16% assured rate of return on their equity and a 0.7 % additional return for every 1% increase in the plant load factor over the 68.5% level. Foreign equity return will be in foreign currency and will be completely protected against foreign exchange rate fluctuations. Other concessions include an enhanced rate of depreciation at 7.5% and a tax holiday.
The installed capacity of generation at the time of independence is 1370 MW and it is 97,846 MW by 31 marr 2000. The percentage shares of different sources of energy:
Hydro power - 24%, Thermal power - 72%, , Nuclear power - 3%, wind power - 1%.
The two major problems associated with Thermal power plants were:
1) Low level of capacity utilization
2) High transmission and distribution laws between 21-26%.
Though the statutory obligation says that the SEBs are required to earn a minimum eturn of not less than 3% on their fixed assets after fully meeting the fixed and operating costs, intereste and tax liabilities no governments seem to bother about it.
The center for Monitoring of Indian Economy has estimated that 12-15% T&;D losses are acceptable. The eighth five year plan targeted to bring down T&D losses by 5%. In some states the T&D losses are around 30-50%
To have an assessment of the financialloss caused by power theft, an illustrative example will be quite illuminating. For the year 1999-2000, it has been estimated that gross energy generation by the utilites was 480.7 billion units. Taking the planning commission's estimates of auziliary confumption as 10.15%, energy available for sale was 431.89 billion units, and estimated T&D losses 22 %. As has been stated, in Indian conditions T&D losses should not be more than 15%.. A reduction in the loss by 7% would have saved 30.23 billion units sold at Rs 2.076 per unit and this would have generated Rs 6,726 crore in the year which would have been enough to install about 2000 MW of additional generating capacity.
Most of the detailed mentioned here are correct. The sector right now has more problems than it every had. I can continue to write a small book on the power sector woes,and probably a few paragraphs on potential solutions. I hope you had enough of the numbers! Will probably look at different topic to speak about numbers the next time :)
Power sector reforms started off in 1991. But during the eighth 5 year plan the target for the power sector is scaled down from 48000 MW to 20,729 MW on the ground of resource constraints. And the actual became only 16,422 MW.
The amendments are done to the existing Acts and Rules to woo the private and foreign companies to invest in this sector. The private companies are provided a 16% assured rate of return on their equity and a 0.7 % additional return for every 1% increase in the plant load factor over the 68.5% level. Foreign equity return will be in foreign currency and will be completely protected against foreign exchange rate fluctuations. Other concessions include an enhanced rate of depreciation at 7.5% and a tax holiday.
The installed capacity of generation at the time of independence is 1370 MW and it is 97,846 MW by 31 marr 2000. The percentage shares of different sources of energy:
Hydro power - 24%, Thermal power - 72%, , Nuclear power - 3%, wind power - 1%.
The two major problems associated with Thermal power plants were:
1) Low level of capacity utilization
2) High transmission and distribution laws between 21-26%.
Though the statutory obligation says that the SEBs are required to earn a minimum eturn of not less than 3% on their fixed assets after fully meeting the fixed and operating costs, intereste and tax liabilities no governments seem to bother about it.
The center for Monitoring of Indian Economy has estimated that 12-15% T&;D losses are acceptable. The eighth five year plan targeted to bring down T&D losses by 5%. In some states the T&D losses are around 30-50%
To have an assessment of the financialloss caused by power theft, an illustrative example will be quite illuminating. For the year 1999-2000, it has been estimated that gross energy generation by the utilites was 480.7 billion units. Taking the planning commission's estimates of auziliary confumption as 10.15%, energy available for sale was 431.89 billion units, and estimated T&D losses 22 %. As has been stated, in Indian conditions T&D losses should not be more than 15%.. A reduction in the loss by 7% would have saved 30.23 billion units sold at Rs 2.076 per unit and this would have generated Rs 6,726 crore in the year which would have been enough to install about 2000 MW of additional generating capacity.
Most of the detailed mentioned here are correct. The sector right now has more problems than it every had. I can continue to write a small book on the power sector woes,and probably a few paragraphs on potential solutions. I hope you had enough of the numbers! Will probably look at different topic to speak about numbers the next time :)
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