Indian power sector: Potential for energy conservation

Indian power sector has great potential for energy conservation, which is almost equivalent to installation of 133 GW solar power plants. Utilities are lacking in proper energy measurement hence percentage of aggregate technical and commercial (AT&C) losses are based on assessments, not on actual measurements. Third-party intervention for independent audit and bulk smart meter installations are the need of the day, which will be paid back in six months by reduction of 5 per cent of AT&C losses.

Background
Energy comprises of primary (oil/gas/coal) and secondary (electricity) energies. Indian power sector encompasses generation (primary) and power evacuation, transmission, and distribution (secondary) energies.

The power generation being a manufacturing set up energy conservation is mainly on thermal part (input energy) and auxiliary power consumption (electricity).

Power transmission system involves voltages from 66/132 kV to 765 kV. Because of higher voltage level, it has negligible power losses, so same are not considered in this article. Power distribution voltage ranges from 0.23 kV to 33 kV and contributes sizeable losses.

Installed capacity of thermal power generation is around 219 GW. It can generate around 1,900 BUs per annum. Reduction of auxiliary power consumption by 3 per cent can conserve about 66 BUs per annum resulting in saving of Rs 33,000 Cr. considering Rs 5/kWh. Similarly if 7 per cent of thermal process optimization is achieved, it will result in saving of around 132BUs per annum i.e. saving of Rs 66,000 Cr. Considering
Rs 5 /kWh. Hence, total saving from generation side would be 198 BUs, equivalent to installation of 133 GW Solar Power Plants. The capital cost for installation of 133 GW would require Rs 5,00,000 Cr. considering
Rs 3.8 Cr. per MW. More savings are possible with further detailing as per the PAT-III cycle.

All India average base demand is 1200 BUs per annum and peak demand is 1900 BUs per annum. Almost all the base demand is catered by thermal generation and peak demand is catered by renewable generation and excess thermal generation.

All India average AT&C losses are 22.81 per cent. Reduction in all India AT&C losses by 1 per cent will save around 16 BUs per annum resulting in saving of
Rs 7,800 Cr. considering Rs.5/kWh.

Now a days major power utilities are showing handsome energy losses ranging from 8 per cent to 30 per cent in order to fulfill the regulatory compliances.

Major challenge in energy conservation in power distribution sector is metering all the consumers and energy measurement. Around 85 per cent bulk metering to feeders and transformers are yet to be installed. Till date agriculture pump sets, water lifting schemes, street lights, Government quarters, etc. are either unmetered or neglected sections of the power utilities. Similarly, the meters installed to various domestic or agriculture consumers are 20 to 30 years old and not working. Hence, though metered actual consumption is not available and billed on average consumption.

Many of the meters are not functioning up to the mark due to inbuilt battery backup issues of old static meters (More than 15 years old) and inefficient electromechanical meters. Moreover, meter testing and meter calibration have never been a priority for any power utility. As a result, percentage of AT&C losses are based on some assumptions and assessments. Though, AT&C loss evaluation methodology is widely accepted, there is a scope of further detailing to some extent.

Case Study
As per Ujjwal DISCOM Assurance Yojana (UDAY) per cent AT&C losses of MSEDCL are 22.79 per cent (Almost in line with all India per cent AT&C losses which are 22.81 per cent). The power consumption pattern of MSEDCL is as under,
Agriculture consumption is 19 per cent of the total consumption.

Around 42 per cent of Agriculture consumers are unmetered and there is no proper mechanism for regular meter reading of metered agriculture consumers. Also, the regular meter reading of metered agriculture consumers is next to impossible for utilities due to physical and site access limitations, hence it is not carried out judiciously. Thus, all agriculture consumers are as good as unmetered.

According to MERC Tariff Order MSEDCL agriculture consumers are divided into two parts viz.

Category 1: Agriculture consumers working above 1318 hours per annum (consumers of Bhandup, Pune and Nashik Zone).

Category 2: Agriculture consumers working below 1318 hours per annum. (Consumers of all zones excluding Bhandup, Pune and Nashik Zone).

Category 1 is especially meant for irrigation for complete year excluding rainy season (180 Days) and category 2 is meant for the irrigation for Rabi crops (50 days) and protective irrigation for Kharif crops (10 Days).

As per the MSEDCL 2014-15 data the agriculture consumption shows that Category 1: Pump Sets were in use for around 1400 hours and Category 2 pump sets were in use for 1295 hours, which is according to regulatory norms (tariff order).

As per the uninterrupted 6 hours of power supply per day for agriculture pump sets, Category 1 pump sets were in use for around 175 days and Category 2 pump sets were in use for 160 days in a year.

The figure below shows that the pure AG feeder of Amravati zone (Category 2) consumes higher power in Rabi season only.

Findings
From above figure it is clear that Category 2 agriculture consumers use pump sets in Rabi season only but they are charged for electricity for all 10 to 12 months. Hence it is clear that around 80 to 100 days of excess consumption is booked in agriculture Category 2 consumers, which is around 8 per cent to 9 per cent of the total energy consumption. This shall either increase the per cent AT&C losses by 8 per cent to 9 per cent or increase the consumption of either industrial or commercial or residential consumers.

Similarly, consumption recoding issues of residential consumers, bill corrections, assessment of faulty meters, gives space to utilities for defining per cent AT&C losses suitable to their requirements.

The utility evaluations based on per cent AT&C losses for various schemes such as UDAY are based on displayed per cent AT&C losses and not on actual per cent AT&C losses and hence may not result as envisaged.

Recommendations
• In order to have a correct assessment of utilities, bulk metering should be done on priority and consumption pattern should be accessible to all (i.e. bulk metering should be online).
• The third-party system evaluation of power utilities by accredited energy auditors is recommended, which will bring out ground realities in this regard.
• Smart meter being a monopolistic product, purchase of the same is a crucial and subjective factor for all utilities.
• In order to promote the competitive market, the government agencies like CEA/EESL/BEE shall essentially standardize the smart meter procurement process. Also, can arrange for bulk purchases, like LED bulbs.

Around 25 crore smart meters (around Rs. 1,00,000 crore) for power consumers and more than 2 crore of smart bulk meters (around Rs. 25,000 crore) for feeders and transformer are required.

As discussed earlier saving of 1 per cent AT&C losses can save Rs. 7,800 crore. Hence 5 per cent AT&C reduction will payback all feeder and transformer bulk smart metering expenses within six months.

The smart metering for all feeders and transformers will give actual per cent AT&C losses (weather it is 23 per cent or 35 per cent or anything else) and also help in identifying the exact loss-making pockets. Further installation of smart meters to all the consumers will help in monitoring the losses and bringing them within control of utilities. It will also help to design load shedding protocol based on the losses criteria.

Independent third-party intervention in power utilities for energy conservation and phase wise revamping of power distribution metering is need of the day to make power business more competitive. It will also help in attracting private investors and private agencies for sustainable growth of power sector.

Authored by:

Dr. Ravi G. Deshmukh
Accredited Energy Auditor and
Power Distribution Expert,
Director, PPS Energy Solutions Pvt Ltd.