De-risking and transparency: Hallmark of the operations

Ratul Puri, Power Chairman, Hindustan Powerprojects Pvt Ltd (HPPPL)

Improvement in multiple programmes led by the government
Power sector has been working on multiple programmes to revive the power sector in India. Some of these including have shown results even in short term along with the drive to provide access to electricity in all the villages. According to Ratul Puri, Power Chairman, Hindustan Powerprojects Pvt Ltd, “The biggest success has come in shape of the implementation of its ambitious solar program. The country in the last few years has scaled up its solar capacity to almost 13.67 GW from MW in early 2010.”

He adds that, the initiative to de-risk the sector and introduce transparency by auction of the bids, the government has been able to bring down the cost of the solar and wind to substantial levels.

While the energy mix in the country is seeing a change, however, understanding coal will continue to be its base load power contributor, the government has been successful in improving the domestic coal supplies. Significantly, no plant has reported generation loss due to non-availability of coal in 2016 in the country, Puri informs.

Further, rural electrification has been a shining achievement over the past three years. 14,092 villages have been electrified out of a total of 18,452 which accounts nearly 15 lakhs households, and 76.37 per cent of the villages. In addition, with over 1,800 circuit kilometres of transmission lines commissioned during 2017-18 (as of April 2017), the sector witnessed increase by nearly 36 per cent in transmission capacity. All these have led to the global rating agency Moody’s to change the rating for India’s power sector from negative to stable, says Puri.

UDAY: The largest contributor
Briefing about the initiative that will change the game in 2017, Puri says, “A variety of factors will drive the change. The government’s Ujwal DISCOM Assurance Yojana or UDAY scheme has been the largest contributor in India’s power reforms story.” UDAY has been responsible for turnaround of state distribution entities that were considered as the weakest link in the entire chain of power sector reforms. Within three years of its launch, a total of 27 States and UTs have joined this scheme for financial and operational turnaround. The scheme has already yielded savings of nearly Rs 12,000 crore to the state power distribution companies. Almost 85 per cent UDAY Bonds have already been issued (Rs 2.32 lakh crore out of total Rs 2.72 lakh crore) leading to less rate of interest for discoms.

Prime Minister launched Rs 16,320-crore Pradhan Mantri Sahaj Bijli Har Ghar Yojana or Saubhagya to provide electricity connections to over 40 million families in rural and urban areas by December 2018. This initiative has reinforced the vision of an electrified India, addressing the economical as well as developmental concerns. Moreover, with a strong emphasis on technological innovation, this program seems to be heading in the correct direction. The inclusion of technologies like decentralised distributed generation (DDG) as a part of this initiative would definitely accelerate the process and positively contribute to December 31, 2018 targets of providing electricity to the rural doorsteps.

“One has to realise India is absorbing the economic costs with a vision to further renewable energy in the country. This commitment has resulted in India being viewed as a leader in the energy sector, globally, states Puri.

De-risking and transparency
Being optimistic on the initiatives taken to improve industry’s health, Puri says, “De-risking and transparency are two major changes that has been the hallmark of the operations in the Indian power sector. This has resulted in building credibility of the Indian energy sector globally towards attracting investments into the country and bringing down the tariffs of solar and wind. The government’s move to bring a transparent mechanism for coal allocation and assuring secured coal supplies to the stranded power projects and approved allocation through e-auctions is another positive sign.”

HPPPL poised to enter in Bangladesh
During the last one year, the HPPPL has commissioned over 150 MW of projects in India and outside. The company has recently acquired 15 solar power generation projects in Japan and is poised to enter the emerging market of Bangladesh with 4 X 25 MWs solar projects at Trishal in Bangladesh.

“The past one year was a power packed period as there were multiple opportunities and scope for the developers to grow their businesses,”
concludes Puri.