2011 INDIA Energy Handbook

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Demand Driven, Supply Chained

Contents

4 Overview of primary energy

7 Energy policy

11 Electricity sector

23 Oil & Gas sector

26 Coal sector

29 Information resources PSI Media Inc • August 2010

2011 India Energy

ndia, home to 1.2 billion people and over 17% of the world’s India Energy population, has a seemingly unquenchable thirst for energy. Handbook One harsh result of its meteoric growth is the widening gap Editorial Staff between required energy and that which is produced. Herein Ilies the problem. India is unable to keep up with demand and faces Scott G Schwieger Editorial Director growing pressure from the international community for climate [email protected] change mitigation. A concerted effort by the central and state Thomas F Armistead governments, and the growing importance of private sector access Senior Editor and investment, will drive India into the future. Sridhar Samudrala Dr Usha Ramachandra Foreign direct investment into India ranked third globally at over $35 Consulting Editors billion for FY 2009. This number is expected to increase greatly in Kiyo Komoda the coming years because of a policy roadmap by the Government Creative Director of India that is increasing the liberalization of the nation’s economy, Clark G Schwieger especially in the energy sector. Initiatives include ambitious five- Special Projects Manager year plans for increasing installed electricity infrastructure, the New Giorgio Dodero Exploration and Licensing Policy for increasing the production of oil Technical Consultant and gas, and the nuclear sector’s recent embrace of international Robert G Schwieger Sr companies to provide equipment and related services. Publisher Published by PSI Media Inc, PSI Media, publisher of handbooks and technical Las Vegas, Nev (USA) journals for the energy industry, and International Energy Consultant Corp (IECC), specialists in providing PSI Media Inc publishes specialty solutions for energy companies, governments, and print and electronic media serving regulatory bodies in developing nations, collaborated energy producers and distributors in on this project to provide the industry with an up- targeted national and regional markets, including: to-date overview of the structure and potential Brazil Energy Handbook opportunities for investment in the Indian Energy India Energy Handbook sector. Headed by Sridhar Samudrala, IECC offers a Samudrala Central Europe Energy great deal of insight into Indian affairs. Handbook Regarding the current business climate in India, Samudrala says it CCS—Carbon Capture & Storage Handbook best, “With the financial crisis almost over, India is the major energy user in the Indian sub-continent and requires energy investment from PSI Media Inc every angle. There is also a major initiative to bring in gas from the 7628 Belmondo Lane Las Vegas, Nev 89128 west through Pakistan to meet the energy requirements of India. Tel: 702-869-4739 With all these opportunities, India is one of the best places for energy Fax: 702-869-6867 investments.”

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3 Overview of primary energy

Hydro takes a back seat. Hydropower now accounts for about 25% of India’s generation capacity, down from 40% in 1980. The favorable economics of developing thermal generation coupled with difficulty in securing long-term financing presents a substantial roadblock for large-scale hydro development.

Jaiprakash Associates

ith 15% of the world’s The Government of India’s (GoI) the country off from cooperation and population and an economic Planning Commission predicts dramatic assistance in civil nuclear technology. growth rate that increases the demand increases for coal and oil over the In 2008, India and the Nuclear Suppliers’ aspiration of its people to better next 20 years. Fig 1-1 and Table 1-2 shows Group agreed on a waiver to the embargo Wquality of life, India has a voracious appetite projections of India’s energy requirements on trade in nuclear technology. The waiver for energy. But the country lacks sufficient in its Integrated Energy Policy (IEP) report has removed most of the obstacles, and domestic energy resources, particularly published in August 2006. India now is planning to have 63,000 MW of petroleum and natural gas, and must Nuclear energy now contributes of nuclear generating capacity by 2032. import much of its growing requirements. more than 4,000 MW of power using a India’s long-range plans, however, Currently, about 35% of India’s commercial largely indigenous technology, but the foresee coal as the sector with the most energy needs are imported. Table 1-1 nuclear industry’s development has been growth potential, fueled mostly by demand indicates the primary commercial energy hamstrung by India’s refusal to sign the for power generation (Fig 1-2). consumption in India. Nuclear Non-Proliferation Treaty, cutting Coal reserves are mainly in the eastern

600 1800 Fig 1-1. Total Energy Requirements Fig 1-2. Total Primary Energy Source: IEP Report, Page 28, Table 2.10 by Source, 1980-2030 New renewables 1600 500 Source: USAID, From Ideas to Action: Clean Energy Solutions for Asia to Address Climate Change, Hydro India Country Report 1400 Hydro Nuclear

Nuclear 400 Natural gas 1200 Oil 1000 Natural gas 300 MTOE MTOE 800 Oil 600 200 Coal

400 100 200 Coal Biomass 0 0 2011-12 2016-17 2021-22 2026-27 2031-32 1980 1990 2000 2010 2020 2030 4 2011 India Energy Fig 1-3. India Energy Resource Map 300 Fig 1-4. Industrial Energy Demand by Fuel, 2005-2030 Delhi 250 Jaipur Guwahati RAPP Kolkata 200

Bhopal Biomass Talcher & IB Valley 150

Tarapur MTOE Mumbai Legend Electricity Load centre Hyderabad 100 Gas Kaiga Coal Oil Bangalore Hydro 50 Chennai Lignite Coal Coastal Kudankulam 0 Nuclear 2005 2010 2015 2020 2025 2030 Source: Powergrid Source: IEA, World Energy Outlook (2007) region while the load centers are growing Impact of n UN Framework Convention on Climate rapidly in the southern, western and Change – ratified in 1993 northern part of the country. But coal’s environmental n Kyoto Protocol – ratified in 2002 appeal lies in the facts that coal-fuelled regulations n Establishment of National Clean power plants are less costly per installed Development Mechanism Authority megawatt than most other designs. Total carbon-dioxide emissions in the (CDM) in 2003 Mining of India’s large coal deposits can country have been gradually increasing n 337 CDM projects are currently be expanded relatively cheaply, with the and are expected to increase sharply in registered with the UNFCCC with product shipped by rail to the power the next 20 years as India enters a period estimated annual emission reduction plant. of sustained economic growth and higher of 31.62 million tonnes of CO2 per The bulk of India’s hydro potential, in consumption of energy. year contrast, is in the northeastern region Over 50% of the total CO2 emissions are Still, India is facing enormous and the northern part of the country in from the power sector. Cement, shipping, international pressure to reduce its the Himalayas. The distribution of energy and iron and steel are other industries that greenhouse-gas emissions under a resources and load centers is consequently have experienced annual growth rates successor agreement to the Kyoto much skewed. The medium and long- above 4% between 1985 and 2005. In Protocol that is now in development. In term plan is to promote pithead stations fact many industries have great potential June 2008, the National Action Plan on using domestic coal and coastal stations for improving energy efficiency through Climate Change (NAPCC) was announced using imported coal and to strengthen use of combined heat and power (CHP). as a major move toward reducing carbon the inter-regional transmission systems. Fig The primary driver for CHP is economic, intensity, but its real effect is still unclear 1-3 illustrates the distributions of energy but it is also an effective means of reducing (see p. 10). resources across India. CO2 emissions. What is obvious is that India will have Coal is expected to continue to meet Over the past two decades, the GoI to choose between increasing its fossil-fuel India’s energy needs in a significant has been very active in participating in use and reducing its emissions; it cannot do way for power generation and other international efforts for climate change both. Investors should keep this uncertainty industrial purposes. Fig 1-4 illustrates the mitigation: in mind and closely watch developments in industrial energy demand by fuel in India n Vienna Convention – ratified in 1991 Indian climate-change policy to make the till 2030. n Montreal Protocol – ratified in 1992 wisest use of their investment capital.

Table 1-1. Commercial Energy Consumption Table 1-2. Total Energy Requirements (MTOE) Source Unit 2007-08 2008-09* Natural Petroleum Products MMT 140.7 145.3 Year Hydro Nuclear Coal Oil Gas Total Natural Gas (net) BCM 31.5 31.8 2011-12 12 17 283 186 48 546 Coal MMT 457.1 493.3 2016-17 18 31 375 241 64 729 Lignite MMT 34.0 NA 2021-22 23 45 521 311 97 997 Electricity Billion kWh 813.1 842.8 2026-27 29 71 706 410 135 1,351 Source: Basic Statistics on Indian Petroleum and Natural Gas, 2008-09, 2031-32 35 98 937 548 197 1,815 Ministry of Petroleum & Natural Gas, New Delhi * Estimate Source: IEP Report, Page 28, Table 2.10

5 Opportunities for foreign investment in India’s energy infrastructure In the first decade of the 21st century, Electric generation. Plans now are amount of distribution cable that if placed cumulative foreign direct investment (FDI) being developed for the augmentation end to end would circle the equator more in India totaled more than $160 billion. of the power sector’s capacity required than 40 times. Beginning with a modest $4 billion in the XII Plan period, 2012-2017. The The 250,000 circuit breakers required between April 2000 and March 2001, FDI goal is to add a total of 100,000 MW of (50,000 annually) nearly consumes rose to $9 billion in 2005-2006, then shot capacity--76.5% powered by coal and India’s current production capability of up dramatically. For the 2009-2010 period, lignite; 20% by hydroelectric resources. 59,000 breakers, the 14 million meters total FDI flow into India is expected to Required investment needed to develop required annually is well above the 12.5 surpass $34 billion, roughly on a par with this generation infrastructure is estimated million that the country could produce in the two previous years. at nearly $100 billion. 2009 (according to the Indian Electrical The power sector ranked sixth among A presentation in August 2009 by & Electronics Manufacturers Assn.), and the leading sectors of the Indian economy, the Central Electricity Authority at the the total requirement of 190,000 MVA in attracting $4.6 billion in FDI since 2000, “International Conclave on Key Inputs for distribution-transformer capacity exceeds according to the Ministry of Commerce Accelerated Development of the Indian current annual production capacity by and Industry’s Department of Industrial Power Sector for the XII Plan and Beyond” more than 3,000 MVA. Policy & Promotion. Adding in the electrical suggested that the aggregate capacity of Gas value chain. Investments in equipment sector, the total rises to $6.8 supercritical generating units would total LNG terminals and gas transmission and billion. FDI in petroleum and natural gas 43,600 MW of the coal/lignite component. distribution pipelines, although significant, totaled $2.7 billion for the period, ranking More specifically, 27 projects would be pale in comparison to those required by the that sector ninth in foreign investment. built with a total of 64 units in the 660-800 electric sector. While data for the XII Plan Restrictions on FDI in coal production MW range. Another 18 projects having 34 were not readily available at press time, caused that sector to rank 54th, with just subcritical units in the 500-600-MW range a look at spending to achieve the XI Plan $15.6 million for the decade. also would burn coal or lignite. Smaller offers some insights. Space is lacking for a detailed breakdown subcritical units would make up the balance In round numbers, $2 billion for LNG of all the energy sectors eligible for FDI, but of the 76,500 MW. terminals, $4.5 billion for transmission a sampling of data for the largest sector With coal playing a very significant pipelines, and nearly $2 billion for in that group--power--suggests the scope role in India’s energy future substantial distribution infrastructure in cities. of opportunities that are available. Up investments will be required to boost Of course, upstream activities in the gas to 100% foreign direct investment, with annual production of the fuel to the 900 sector (exploration and production) are in amounts unlimited, is allowed for most million tonnes required. Current thinking is addition to the investments required for projects relating to electricity generation, that domestic sources would supply 845 terminals and pipelines. Planned upstream transmission, and distribution, but not for million tonnes, imports the balance. outlay to achieve the XI Plan was more nuclear power plants. In the renewable- Electric distribution. Required than $30 billion, but internal resources energy sector, too, 100% FDI is allowed investment in the distribution sector is fell short by about 30%--thereby creating and a generation-based incentive scheme estimated at $86.4 billion for the XII Plan. opportunities for foreign investment. has been put in place for wind power The infrastructure that must be installed Looking ahead, supply options to meet projects especially for the foreign investors to meet the five-year plan is staggering: growing demand include the following: who cannot take advantage of the benefits 2.5 million poles for 33-kV overhead lines, n New domestic sources. Attention of accelerated depreciation, as domestic another 9.4 million poles for other lines currently focuses on the East Coast, investors can. rated above 11 kV, and 20 million poles offshore. Some financial institutions owned by the for low-tension lines. More than 50 million n Transnational pipeline imports. Routes Government exist specifically to meet the service connections would be added. include Iran-Pakistan-India; Turkmenistan- needs of the energy sector. For example, The 33-kV lines planned total 180,000 Afghanistan-Pakistan-India; Myanmar- the Power Finance Corporation (PFC) and circuit kilometers, 11-kV lines 750,000 ckm, India. the Rural Electrification Corporation (REC) and low-tension lines 800,000 ckm. To n New LNG imports on the West Coast serve the financing needs of the power put these numbers in perspective, India is via Dabhol, Kochi, Dahej (expansion), sector across the electricity value chain. planning to install in only 60 months an and Mangalore. Major trade organizations Indian Electrical and Electronics organizations from the private as well as industry. Through its 400 professionals, Manufacturing Association (IEEMA) public sectors and an indirect membership FICCI is active in 39 sectors of the economy. Founded in 1948, IEEMA represents of over 90,000 companies from around 396 FICCI’s stand on policy issues is sought out the entire Indian electrical and industrial national and regional sectoral associations. by think tanks, governments and academia. electronics industry. IEEMA promotes and CII has a strong energy sector presence Its publications are widely read for their protects interests of the Indian companies and advocates the industry viewpoint in-depth research and policy prescriptions. active in the industry and is invited to with government and policy makers. FICCI has joint business councils with represent the sector on many councils and http://www.cii.in 79 countries around the world. A non- committees constituted by the governments. government, not-for-profit organization, http://www.ieema.org Federation of Indian Chambers of FICCI has direct membership from the private Commerce and Industry (FICCI) as well as public sectors and an indirect Confederation of Indian Industry (CII) Established in 1927, FICCI is one of the membership of over 83,000 companies CII is India’s premier industrial association, largest and oldest business associations in from regional chambers of commerce. with a direct membership of over 7,800 India and the voice of India’s business and http://www.ficci.com

6 2011 India Energy

The August 2006 Report of the electricity and downstream petroleum and Expert Committee on Integrated Energy natural-gas sectors. The Central Electricity Policy (IEP) for the first time analyzed the Regulatory Commission (CERC) regulates resource options for India’s energy needs. interstate transactions and business, and Energy It comprehensively examined all sources each state has a State Electricity Regulatory of energy, including renewables. The IEP Commission (SERC) for intrastate transactions. forecasted energy demand up to 2031-32 Much of the regulation covering electricity and made broad recommendations to generation and transmission stems from policy optimally meet the surging demand. the CERC (and is by and large followed It concluded that coal, particularly by the SERCs), while SERCs have exclusive domestic coal, would continue to fuel jurisdiction on electricity distribution in the Planning and policy the power sector in the country. Since respective states. then, the possibilities of exploring nuclear The Petroleum and Natural Gas India’s four-decade-long experiment with energy as well as the discoveries of natural Regulatory Board (PNGRB) regulates a state-owned economy has evolved gas have somewhat tilted the balance. The downstream activities in the petroleum and since a 1991 crisis forced the country to energy sector is overseen by the following natural gas sectors. The upstream activities liberalize its economy. It now allows greater GoI ministries: continue to be regulated by the central individual initiative and, importantly, n Ministry of Power government through the Directorate foreign direct investment. Federal- and (http://powermin.nic.in/) General of Hydrocarbons. state-owned companies still dominate the n Ministry of Petroleum and Natural Gas energy industry, but the private sector is (http://petroleum.nic.in/) Power sector actively capturing market share and even n Ministry of New and Renewable Energy investing in the state-owned companies. (http://mnre.gov.in/) India’s power sector continues to be a Energy policy and planning are largely n Ministry of Coal stumbling block for its infrastructure growth controlled by the central government (http://coal.nic.in/welcome.html) and overall development. Energy and in India’s federal political setup. While n Department of Atomic Energy peak shortages abound and transmission the central government alone controls (http://www.dae.gov.in/) and distribution losses continue to be planning and policy related to fossil fuels The Planning Commission is in overall unreasonably high. such as coal, natural gas, and petroleum, charge of developing India’s five-year The Government of India began the constitution outlines both the state plans across the ministries and sectors. liberalizing the power sector in India and central government’s responsibility for Since the public sector continues to play a in 1991 by opening up the sector to electricity policy and planning. The Planning dominant role in the energy sector in India, private investments in generation. The Commission of the GoI is responsible for the ministries wield enormous power and key legislative and policy interventions in planning for power, energy, energy policy, influence in the way the sector develops India have been: and rural energy within the framework of a and is managed. n The Electricity Act 2003 (http:// succession of national five-year plans. States The framework for independent www.cea.nic.in/home_page_links/

take responsibility for power delivery. regulation has been established for the ElectricityAct2003.pdf) Jindal Steel and Power OP Jindal coal plant. Already the largest coal-fired IPP in India (1000 MW), a brownfield expansion consisting of 4 x 600-MW units supplied by BHEL is underway. The site is also home to the largest private coal mine, coal washery, and covered coal conveyor belt in India. 7 n National Action Plan on Climate Change (http://pmindia.nic.in/Pg01-52.pdf) n National Electricity Policy 2005 (http:// www.cea.nic.in/planning/national_ Electricity_policy.htm) n National Tariff Policy 2006 (http:// www.powermin.nic.in/whats_new/ pdf/Tariff_Policy.pdf) n Rural Electrification Policy 2006 (http:// www.powermin.nic.in/whats_new/ pdf/RE%20Policy.pdf) The basic aim of the Electricity Act 2003, which consolidated the provisions of all previous legislation, was to take measures conducive to the growth of the electricity sector in the country, to promote competition, to protect consumers’ interest, to rationalize tariffs, and to promote efficient and environment-friendly policies. Its main features are: n Delicensing electricity generation n Mandating restructuring of state electricity boards to separate transmission (wires business) and trade n Allowing for open access on transmission and distribution networks n Facilitating electricity trading n Mandating the establishment of SERCs in each state. n

Liberalizing captive or self-generation Ventures KSK Energy n Setting up the Appellate Tribunal for Electricity (ATE) Sai Regency combined-cycle plant. This 58-MW CHP plant in Tamil Nadu supplies steam and electricity to multiple industrial customers. The addition of 2000 MW of CHP In addition, the focus was widened to generation is included in the XII Plan to increase the reliability of steam and electricity supply upgrade and improve the financial and for industry and hospitals. operational efficiency of the distribution companies. A massive funding scheme of the GoI called the Accelerated Power Table 2-1. Structure of the Indian Power Sector Development and Reform Program (APDRP) was initiated to provide funds to State Policy Making Central Government State Governments Electricity Boards and distribution companies to improve system efficiency and provide Planning Central Electricity Authority (Planning Commission under incentives for better performance. Central Government) The National Electricity Policy 2005, State Planning Departments which introduced the concept of universal Regulation Central Electricity Regulatory Commission (Appellate Tribunal service, mandated that all villages should be for Electricity) electrified by 2007-2008 and all households State Electricity Regulatory Commissions (Ombudsman in by 2011-2012. Table 2-1 outlines the each SERC) structure of the Power sector in India. System Operators National Load Despatch Centre The GoI’s Ministry of Power (MoP) is Five Regional Load Despatch Centres responsible for planning, formulating State Load Despatch Centres policies, processing of projects for Generation Central Generating Stations (e.g. NTPC, NHPC) investment decision, and monitoring of Joint Ventures – Centre & State (NEEPCO, THDC, DVC) the implementation of power projects. State Generating Stations (e.g. APGENCO, Mahagenco) The Central Electricity Authority (CEA) is a Independent Private Producers (e.g. GVK, Spectrum, etc) statutory body constituted by the central Transmission Central Transmission Utility (PGCIL) government that functions under the State Transmission Utilities (e.g. APTransco, KPTCL) Electricity Act 2003. The CEA is responsible Private entities (e.g Lanco, Reliance, Tata ) for formulating the National Electricity Plan Traders Traders designated to trade across borders (PTC) in accordance with the National Electricity Inter-state traders (e.g. LANCO, NTPC etc.) Policy, once in five years. Intra-state traders The CEA is the main technical adviser Distribution Distribution arm of State Electricity Boards (e.g. TNEB, PSEB etc.) to the government and regulatory Distribution Companies (e.g. Reliance, Tata, Bescom, etc.) commissions. It is also required to Private Companies (e.g. Reliance Infra, NDPL, CESC, etc.) specify technical standards and safety Franchises (e.g. Torrent) requirements for the construction, Financial Institutions Power Finance Corporation (PFC) operation, and maintenance of electrical Rural Electrification Corporation (REC) lines and setting up of electrical standards. Energy Conservation Bureau of Energy Efficiency (BEE) Any generating company intending to set 8

2011 India Energy

Nuclear Power Corp of India Cairn The Mangala Development Pipeline is the world’s longest continuously Big plans for nuclear. While there is currently a prohibition heated and insulated pipeline and has an access to 75% of India’s refining on FDI for nuclear power plants, installed capacity is expected capacity. It originates from Mangala Processing Terminal and runs 670 km to increase tenfold by 2020 to 44,000 MW. By 2050, the through Rajasthan and Gujarat before it reaches its end near Jamnagar GoI expects nuclear energy to supply 25% of the country’s on the western coast line of India. power.

up a hydropower generating station also changes in the structure of the Indian oil All 10 oil discoveries in 2007-08 were requires the concurrence of the CEA. industry as well as increased the rate of made by private oil companies like Reliance The Electricity Act 2003 and the exploration of the sedimentary basin area of Industries Ltd. (RIL), Cairn and Essar Oil subsequent policies of the government, the country from 11% to more than 44%. Ltd. (EOL). The GoI is examining the especially the Ultra Mega Power Projects The NELP opened India’s oil and gas possibility of introducing the Open Acreage (UMPPs) under the competitive bidding sector to private-sector participation through Licensing Policy (OALP) to allow year-round route, are expected to add substantial international competitive bidding for blocks bidding for blocks to explore rather than thermal capacity. In 2008, the GoI under a production-sharing contract with waiting for the government to identify promulgated the Hydro Power Policy the GoI. National Oil Companies (NOCs) blocks for exploration. Recently, there has to encourage private investments, continue to account for a major share of been a thrust towards NOCs acquiring improve resettlement and rehabilitation crude oil and natural gas production, but hydrocarbon assets abroad to meet the and enhance the financial viability of there has been a significant increase in country’s need for energy security and hydropower development. Earlier in private participation. accelerating demand. 2007, the MoP had issued the With the increasing presence approach and guidelines for the Table 2-2. Structure of the Indian of private players and the move development of merchant power Petroleum and Natural Gas Sector towards increasing the extent of plants (MPPs). gas distribution in the country, Two main programs of the GoI Policy Making Ministry of Petroleum and Natural Gas the Petroleum and Natural Gas are aimed at improving electricity Planning Ministry of Petroleum and Natural Gas Regulatory Board (PNGRB) was distribution. The APDRP provides Planning Commission set up under the PNGRB Act loans and grants to augment Petroleum Planning and Analysis Cell (PPAC) 2006. The PNGRB regulates the investments in distribution system ATE with a separate bench to hear petroleum refining, processing, storage, upgrades. The Rajiv Gandhi and natural gas cases transportation, distribution, Grameen Vidyutikiran Yojana Regulation Directorate of Hydrocarbons under the GoI marketing, and sale of crude oil, (RGGVY), launched in 2005, (upstream) petroleum products, and natural aims at electrifying all villages and Petroleum and Natural Gas Regulatory Board gas. It also protects the interests of providing access to electricity to (downstream) consumers and entities engaged all rural households over a period Public Sector Private Sector in specified activities in these areas of four years. Upstream (Exploration ONGC Cairn and is responsible to ensure & Production) OIL Hardy uninterrupted and adequate OVL supply of crude oil, petroleum Petroleum and GSPC (State Sector) products, and natural gas to natural gas Refineries CPCL RPL all parts of the country and to BRPL Essar promote competitive markets. India’s petroleum and natural- NRL The PNGRB issued guidelines gas sector relies heavily on MRPL relating to city gas distribution government-run oil companies Marketing Companies GAIL network and natural gas as seen in Table 2-2. IGL pipelines in 2007-08 and 2008- India conducted nine rounds MGL 09. However the upstream oil of exploration bidding between Integrated Oil IOCL RIL and gas business continues to 1979 and 1995, but they were not Companies HPCL EOL be regulated by the Directorate successful. The New Exploration BPCL Shell of Hydrocarbons (DGH). The and Licensing Policy (NELP) Financial Institution OIDB DGH operates under the introduced by the government Ministry of Petroleum & Natural in 1997-98 brought about major Source: IECC Gas (MOP&NG) as a regulator 9 Table 2-3. Structure of Renewable Energy in India renewable-energy-based power projects on a Build-Own-Operate (BOO) or a Policy Making Central Government, Ministry of New and Renewable Energy Build-Own-Transfer (BOT) basis. Investors Planning Planning Commission, Ministry of New and Renewable Energy are allowed to bring in funds directly, Regulation CERC at the Centre incorporate an Indian company, or allot SERCs at the State shares to foreign investors. ATE Orders where applicable With the announcement of the National Action Plan on Climate Change Public Sector Private Sector (NAPCC), there is a marked shift in policy to Equipment Suzlon diversifying the energy mix to lower carbon Manufacturing Enercon intensity. The NAPCC calls for boosting and Generation Tata BP Solar renewable energy’s share of the national Companies NEG-Micon generation from 2% to 5%, with specific Vestas-RRB emphasis on significantly increasing solar Financial Institution IREDA energy’s share of the total energy mix. It envisions increased use of distributed solar Table 2-4. Structure of the Indian Coal Sector photovoltaic cells, but also, as technology permits, commercial-scale solar-reflector Policy Making Central Government generating stations. State Governments Planning Office of the Coal Controller under the Central Government Coal Regulation Office of the Coal Controller under the Ministry of Coal The Ministry of Coal is the apex organization Mining Companies Coal India Ltd. and its Subsidiaries (94% market share) responsible for the development of coal Neyveli Lignite Ltd. (CPSUs) and lignite in the country. It has the overall Singareni Collieries Ltd.; captive mining for state government companies responsibility for determining policies and Private coal blocks for captive mining strategies for exploring and developing coal and lignite reserves, sanctioning important Mining Equipment Bharat Earth Moving Equipment Ltd. (CPSU) projects of high value and deciding all Source: IECC related issues. The coal sector continues to be dominated by government-owned companies with no significant private-sector Table 2-5. Structure of the Nuclear Sector in India presence, and foreign direct investment is Policy Making Central Government / Department of Atomic Energy restricted (see p. 6). Table 2-4 outlines the & Planning framework of India’s coal industry. Regulation Atomic Energy Regulatory Board / Atomic Energy Commission In December 2000, the GoI loosened Generation Nuclear Power Corporation of India Ltd. (NPCIL) the restrictions on state government Companies BHAVINI companies to allow them to mine coal and lignite reserves anywhere in the country, Input Providers Heavy Water Board (HWB) subject to certain conditions. Since 2004, Nuclear Fuel Complex (NFC) Indian Rare Earth Ltd (IREL) the GoI has engaged in allocating large Uranium Corporation of India Ltd. (UCIL) areas/blocks to government companies (both central and state). Preference is being Financial Institution Board of Research in Nuclear Sciences (BRNS) given to government power utilities. Source: IECC Nuclear energy to advise the MOP&NG on exploration which in 2008 generated 113.85 billion strategies and production policies. kWh. Wind energy was a distant second, The Department of Atomic Energy is Oil and natural gas exploration and with 14.8 billion kWh. Comparatively, mandated to increase the share of nuclear production, refining, and distribution, energy from other renewable sources power using both indigenous and other as well as the marketing, import, export, was negligible or non-existent. Table 2-3 proven technologies, and also developing and conservation of petroleum products summarizes the structure of the renewable fast breeder reactors and thorium reactors and liquefied natural gas fall under the sector in India. with associated fuel-cycle facilities. Table responsibility of the MOP&NG. The Electricity Act 2003 provides the 2-5 illustrates the central government’s The government continues to regulate legislative impetus for the development influence over the nuclear sector. prices for both petroleum and natural gas of renewable energy in part by directing The signing of the Indo-U.S. nuclear through the Petroleum Planning & Analysis the CERC and SERCs to fix renewable deal in October 2008 has opened up Cell (PPAC), attached to the MOP&NG. power purchase obligations (RPPOs) for opportunities for the growth of nuclear all distribution companies under their power in the country. The Nuclear Power Renewable energy jurisdiction. The regulatory commissions Corporation of India Ltd.( NPCIL), the only The renewable-energy sector is administered can also determine preferential tariffs nuclear power generating company in by a separate line ministry, but it is regulated for renewable power to make it more the country, aims to increase its installed by the CERC and SERCs along with the competitive with conventional sources on capacity from 4,120 MW to 21,000 MW in power sector. The Ministry of New and cost of electricity. the next five years, but GoI policy prohibits Renewable Energy (MNRE) plans and Foreign direct investment up to 100% foreign direct investment in nuclear power promotes the development of all sources is allowed under the automatic route and plants (see p. 6) . of renewable energy. By far the largest can set up a wholly-owned subsidiary. In summary, India’s power, petroleum, renewable-energy source is hydropower, Foreign investors are allowed to set up and natural gas sectors have mostly opened 10 2011 India Energy

Private power growth. Lanco Amarkantak Power Ltd. is adding 2 × 660-MW units to its coal-based generating station in Chhattisgarh to increase plant output to 1920 MW. Project financing was secured through the state-run Project Finance Corp. under XI Plan.

Electricity sector V A Chakrarthy

up to the private sector and market-based ell-mell load growth driven by the Spikes in power demand from the interventions even while government- fast-expanding economy has left agricultural sector are forcing state owned entities continue to dominate PIndia scrambling to catch up with governments to increase load shedding the sectors. Private-sector participation electricity demand as power outages bedevil in the summer months. For example, the is much more limited in the coal sector, the country. The Electric Power Survey 17 power deficit in state of Punjab is so severe with captive mining for industries as well forecasts a peak demand growth of 9% for that it has mandated a one-day-per-week as state government-owned organizations the period up to the end of the XI Plan (2011- power cut for the steel manufacturing being the main exception. The nuclear 12) against actual achievement of 5.3% (Fig industry, which could be extended to two sector has only recently been opened to 3-1). In 2009, CRISIL research estimated that days if the situation remains unchanged. other government-owned entities and roughly $160 billion would likely be invested Plans for increased capacity and power most likely will proceed in the form of joint in the power sector by 2014. About $100 management initiatives are being explored ventures with the incumbent corporation billion would be in generation, with nearly to reduce the cost and increase the reliability NPCIL. half of that from private investors. of electricity to customers.

2000000 Fig 3-2. Demand/Supply Forecasts Fig 3-1. Projection of Actual 1500 220 Power Requirement Energy Requirements (TWh) 1392 218 1400 200 Source: Demand Projections from 1300 Energy Availability (TWh) 17th Electric Power Survey (EPS) of India 1500000 1200 Peak Load (GW) 180 1098 1100 Peak Served (GW)* 153 154 160 1000 969 140 GWh 900 821 115 120 1000000 800 GW TWh 690 100 700 624 96 100 600 80 500 400 60 500000 300 40 200 100 20 0 0 0 X Plan XI Plan XII Plan 2004 2005 2006 2007 2008 2009 2010 2011 2016 2020 2006-07 2011-12 2016-17 -05 -06 -07 -08 -09 -10 -11 -12 -17 -21 *Extrapolated by PXIL Source: CEA 11 Table 3-1. Status of Awarded UMPPs Project UMPP Developer State Fuel Linkage EPC Schedule Mundra TPC Gujarat 26% stake in Indonesia’s Doosan Heavy Industries . Two 800 MW units Bumi Resources’ two coal mines & Construction Co. Sasan RPL Madhya Pradesh Moher, Moher-Amlohri Extension Reliance Infrastructure Limited Two units by coal blocks at Singrauli Coalfields Dec 2011, all six units by Apr 2013 Krishnapatnam RPL Andhra Pradesh Acquisition of three Indonesian RPL in talks with Doosan Heavy September 2013— coal mines Industries & Construction Co., October 2015 Toshiba Corp., and L&T Tilaiya RPL Jharkhand Kirandhari B and C blocks of Reliance Infrastructure Limited 2015 North Karanpura Coalfields Source: India Infrastructure

A variety of initiatives are in the works to in most of the states and the pace of The national Power Grid Corp. of boost additional capacity from public and restructuring is slow largely because there India (POWERGRID) has always been a private players, including UMPPs, MPPs, is no transparency on transmission capacity wires company and is unaffected by the and group captive generation. Despite and because of restrictive conditions of separation of the trading and transmission these ambitious targets, power demand cross-subsidy surcharge. In fact, the only sectors. But at the state level, vertically will likely outstrip supply well into the XII open-access activity is by captive generators integrated state electricity boards and Plan period (Fig 3-2). to transmit power to their load center. Most transmission companies (which also In January 2010, KPMG released a of the power in the country continues to traded under the single-buyer model in report that offers insightful perspectives be procured through long-term power- operation) in restructured states had to on the future of the power generation, purchase agreements (PPAs). further separate the wires business from entitled Power Sector in India: White Since January 2004, the CERC has the trading business. Implementation of Paper on Implementation Challenges granted 43 trading licenses, of which the the mandated separation differs among and Opportunities. With such large-scale Power Trading Corporation (PTC ) has the the states. development taking place in the power largest share. PTC is the designated trader Andhra Pradesh and Karnataka chose sector and the associated challenges, the for international electricity transactions, to allocate the long-term PPAs to the importance of comprehensive project particularly from Bhutan and Nepal. management organization is paramount Capacities of MPPs, UMPPs, and captive Fig 3-4. Fuel Breakdown to ensure that projects are completed in plants are expected to increase the share a thorough and timely manner. of power traded in the country either of Thermal Generation through bilateral, short-term trades or the Diesel 1% Power trading power exchanges. Traders can use either of two power The Electricity Act 2003 laid the legal exchanges, the Indian Energy Exchange foundation for the development of a (IEX) or the Power Exchange India Ltd. national power market by mandating the (PXIL). They were initially given permission Gas Coal 17% 82% unbundling of the wires business from for day-ahead trading, but the CERC is electricity trading and permitting open considering whether to allow longer-term access on transmission and distribution contracts, including week-ahead, month- networks. ahead, and year-ahead as well as seasonal However, a single-buyer model prevails contracts. Source: CEA

800 Fig 3-3. Electricity Fig 3-5. Electricity Generation Mix, 2005-2030 1200 700 Generation Renewables Source: IEA, World Energy Outlook (2007) Growth by Type, Coal Oil 1985-2008 Nuclear 1000 600 Gas Source: EIA Nuclear 800 500 Hydro Biomass 600 400 Hydroelectric Other renewables TWh 300 400 Billion KWh Conventional Thermal 200 200

100 0

0 –200 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2005-2015 2015-2030 12 2011 India Energy distribution companies of their states. Orissa 3-1 outlines four UMPPs that have already North Eastern Electric Power Corporation retained Gridco as a trading company and been awarded. Ltd. (NEEPCO) estimates of potential formed a separate transmission company. One 660-MW unit at Sasan and two hydropower in the region at about Still other states, like Gujarat, entrusted 800-MW units at Mundra each are expected 60,000 MW. Because of the stagnation in the holding company in the state with to be commissioned in the current Eleventh hydro development, NEEPCO advocates the responsibility of power purchase and Five-Year Plan. The status of the other a uniform power policy for the region to trading. UMPPs is as follows: exploit its power potential. Domestic customers make up about n UMPP at Sarguja District, Chhattisgarh: 75% of total customers in India, but All the pre-Request for Qualification Natural gas they consume less than 65% of the (RfQ) activities have been power. Industrial customers account for completed. Natural gas fuels about 10% of the more than 35% of total electricity sales n UMPP at Sundergarh District, Orissa: total installed generation capacity. The despite substantial captive generation, Most of the requisites for issuing XI Plan calls for 7,313 MW of gas-based which is conservatively estimated at the RfQ are in place except the capacity addition, of which 2,984 MW was about 25,000 MW. Section 4 notification regarding land commissioned by the end of June 2009. Generation acqusition. The capacity addition for the XII Plan will n UMPP in Tamil Nadu: Site has been depend on the availability of gas, which is The Indian power generation market is the finalized at Cheyyur along with also used for fertilizer and transportation. fourth-largest in Asia and the sixth-largest in the captive port, which is under In recent years the shortage of gas led to the world. Coal fuels about 55% of India’s finalization. substantial loss of generation and stranded power generation, and if current projections n UMPP in Andhra Pradesh (second one): gas-based capacity. are accurate, that proportion will grow Site has been identified at Nayunipalli, The natural gas now being produced substantially in the next 20 years. To this Prakasam District, and finalized by in India’s Krishna-Godavari Basin (KG point, India has met its burgeoning demand CEA/PFC in consultation with the state Basin) is expected to boost gas-based for electricity primarily with the development government. generation, particularly the plants that of conventional thermal power generation The requisite inputs regarding land have stranded capacity because of the with coal representing the lion’s share of availability and water linkage are being previous nonavailability of gas. But under generating fuel (Fig 3-3, 3-4). examined for the UMPPs to be located in the government’s gas-allocation policy, The central and state governments Maharashtra, the second UMPP in Gujarat, new power projects would get the lowest control 83% of India’s generation capacity and two additional UMPPs in Orissa. priority. Thus, planners are being cautious of 153,694 MW; the National Thermal about increasing the capacities of gas- Power Corporation Ltd. (NTPC), owned Hydropower based generation. All the UMPPs are fueled by the central government, has almost by coal. 20% of the country’s capacity, and the Hydropower’s share of the country’s Gas availability improved in 2009-10 private sector accounts for only 17%. But generation capacity is expected to remain with allocation of 18 million standard the figures for total generation capacity around 25% in the long run. Even if the cubic meters per day (MMSCMD) to exclude self- or captive generation, which potential of 150,000 MW is fully exploited existing power plants from Reliance is estimated to be 19,500 MW. The per by 2030-31, the share of hydro would in Industries production in the KG Basin. capita consumption was 704.2 kWh in fact be less than 25%. However, the XI But the need to reduce the power sector’s 2007-08 against the world average of Plan has seen slippages of 5,200 MW of CO2 emissions and to compensate for 2595.7 kWh. hydro projects, including 1,100 MW by threatened coal shortages is making Energy availability is 689 TWh but the NTPC and 2,000 MW by NHPC. Land- construction of gas-based capacity more requirement is 774 TWh, so shortages are acquisition, resettlement and rehabilitation urgent. chronic. Indias peak deficit is 12.1%, and its issues have caused significant delays in Plans for the XII Plan call for a target energy deficit 9.4%. A July 2009 pan-Indian hydro projects. of 12,000 MW of gas-based capacity, study commissioned by Wärtsilä India, The northeastern region holds the 2,000 MW of combined heating and entitled The Real Cost of Power, estimates greatest potential for hydropower. The power units (CHP) at large hospitals, malls, that Indians spend about $6.2 billion every year to fuel and maintain power back-up equipment to secure themselves against NTPC frequent outages. Adani Power The XI Plan (2007-2012) aims to address this problem by adding 78,700 Lanco MW of generation. Of that, 76% is Tata Power expected to be coal-based and 20% from Fig 3-6. Capacity Commissioning hydroelectric sources. India’s increasing JSW in XI Plan, by Company dependence on coal generation to Sterlite meet electricity needs will continue well NHPC into the future, with some projections increasing to over 70% of electricity Reliance Power generation by 2030 (Fig 3-5). Torrent Nine UMPPs of 4,000 MW each have been identified for development under the Jaiprakash Power international competitive bidding route. GVK The Ministry of Power defines a UMPP as a coal-fueled, supercritical power plant CESC Source: CEA of about 4,000 MW each involving an 0 3000 6000 9000 12000 15000 investment of about $3.5 billion. Table MW 13 Table 3-2. Nuclear Power Generation by Central Sector during 2008-09 venture with NPCIL to enter the nuclear sector (Table 3-2). Several Monitored Achievement Generation private players have also shown Power Capacity Generation Actual Generation in 2007-08 in 2007-08 Plant Load Station (MW) Target Generation in 2007-08 (% of Target) (% of Target) Factor (%) interest in the sector. Mumbai- based Larsen and Toubro, for Kaiga 660 3,964 2,688 2,495 68 108 NA example, have entered into Kakrapara 440 1,013 1,213 2,036 120 60 31 agreements with international MAPP 440 2,026 1,518 1,752 75 87 39 companies like Westinghouse, Atomic Energy of Canada Ltd., NAPS 440 1,013 740 674 73 110 19 and AtomStroyExport for nuclear RAPS 740 3,731 2,255 2,480 60 91 35 equipment and other related Tarapur 1,400 7,253 6,298 7,339 87 86 51 services. But no foreign direct Total Nuclear 4,120 19,000 14,713 16,777 77 88 41 investment in nuclear power plants is permitted. Source: Central Electricity Authority

Table 3-3. Renewable Power Purchase Obligations (RPPO) Fixed by SERCs in Different States State Annual RPPO Andhra Pradesh 5% Gujarat 2% Haryana 3-10% Karnataka Min 10% Kerala 5% Madhya Pradesh 10% Maharashtra 3% (annual increase of 1% point) Orissa 450 MU Rajasthan 7.5% Tamil Nadu 10%

Uttar Pradesh 7.5% Suzlon West Bengal 3.8% Suzlon in Rajahstan. India’s largest manufacturer of wind turbines received an order from Hindustan Petroleum Corporation Limited (HPCL) for a 25.5 MW wind turbine project with 17 units of Suzlon’s S82 1.5 Source: http://mnes.nic. in/press-releases/press- MW wind turbines. When the project is commissioned in Q3 FY 2010-11, HPCL will have a wind turbine release-28042008-2.pdf portfolio exceeding 50 MW. Table 3-4. Wind Power Installed Capacity In India IT parks, and commercial buildings and Nuclear 2,000 MW more through reciprocating by State (MW) engines located near large cities where The signing of the Indo-U.S. nuclear deal in Gross Installed gas pipelines are available for peaking October 2006, following a waiver from the State Potential Capacity and emergency generation. The gas Nuclear Suppliers Group, has opened up Andhra Pradesh 8,968 123 requirement for this capacity is estimated opportunities for India in the field of civilian Gujarat 10,645 1,567 at 50 MMSCMD. nuclear trade. The Indian nuclear market Karnataka 11,531 1,327 is estimated to be worth $100 billion, and Key Electric Power planners hope to build 40,000 MW of nuclear Kerala 1,171 27 capacity by 2020. The GoI wants the share Producers Madhya Pradesh 1,019 213 of nuclear in the overall fuel mix to increase Maharashtra 4,584 1,939 The XI Plan has seen a remarkable from around 3% to 25% by 2050. turnaround for private power producers The Nuclear Power Corporation of Orissa 255 — (Fig 3-6). Of the planned capacity addition India Ltd. (NPCIL) is the country’s only Rajasthan 4,858 738 of 26,000 MW, Adani Power is likely to add nuclear generator. It has set itself a target Tamil Nadu 5,530 4,305 6,600 MW, followed by Lanco Infratech of increasing its installed capacity from the (3,200 MW), Tata Power (2,900 MW) and current 4,120 MW to 20,000 in the next five West Bengal 1 JSW Energy (2,900 MW). years. NPCIL has entered into agreements Others 3 This growth in private power has been with various international companies to Total 48,561 10,242 attributed to better project management. import fuel and equipment. Source: Indian Wind Energy Association The capacity addition mix is slowly The leading thermal generator in the 2009 report (as of 3/31/09) changing in favor of the private sector. country, the state-owned NTPC, is in joint 14 Identify gas turbine installations by model and vintage anywhere in the world!

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UDI_CCGTAd_0610.indd 1 6/29/2010 10:45:08 AM Renewables The Electricity Act 2003, the policies with CERC will have the option either to framed under the Act, and the National sell power at a preferential tariff set by India is promoting renewable energy to Action Plan of Climate Change (NAPCC) their SERC or to sell the power and its augment the total power supply and to together provide a roadmap for increasing associated environmental benefits in the meet rural needs either by augmenting grid the share of renewables in the total form of renewable-energy certificates. The supply or by off-grid supply. Its contribution generation mix. certificates can be sold in CERC-approved to the total electricity matrix is only about However, renewable-energy resources are exchanges to entities needing them to 8% currently, but it is making the not evenly spread across the country and the meet their RPPO, thus creating a national case for renewable energy as high cost of RE generation discourages market for such generators to recover a necessary component of local distribution companies from their costs. sustainable development. Over As of March 31, 2010, 16,817 MW 15% of the incremental capacity of grid-connected renewable power addition in the current XI Plan is Fig 3-7. Regional Load was in place, according to the MNRE. expected to be from renewable Despatch Centres Of that, 11,807 MW was from wind sources. energy. Small hydropower, up to 25 The primary vehicles for NRLDC MW, supplied 2,735 MW, and bagasse- development, RPPOs, are NERLDC fueled cogeneration 1,334 MW. Just regulatory mechanisms 10.28 MW of solar energy generation designed to increase capacity was installed. Off-grid and the proportion of ERLDC distributed renewable-energy generation renewables in the supplied an additional 404.56 MW power market, where WRLDC electricity equivalent, boosting the total fossil energy now Source: Powergrid to 17,221.86 MW. dominates. An RPPO In terms of installed capacity of wind- specifies the minimum purchasing more based generation, India ranks 5th in the quantity of renewable energy than their obligatory world. Indian wind-turbine manufacturing required in each state. Under the amount of renewable giant Suzlon is the largest in Asia in terms Electricity Act 2003, the National SRLDC generation. To address the of market share and has installed more Power Policy 2005, and the Tariff imbalances and encourage RE- than half of India’s capacity. Great potential Policy 2006, each SERC must set capacity addition in states with exists to develop wind energy and can be a distribution licensee’s obligation untapped RE potential, the CERC sustained for decades to come. Table 3-4 for power purchases from renewable promulgated a regulation creating offers a glimpse at potential and installed energy resources. Regulators in several renewable-energy certificates in capacity by state. states have issued orders for RPPOs January 2010. In December 2009, the GoI unveiled varying from 1 % to 10% (Table 3-3). RE generators who register Continued on page18 15 Sponsored Statement Sponsored Statement Making waste gas a business opportunity in the power generation industry www.ansaldoenergia.com

Background The new gas turbine features the previous ones). Due to this solution, the to finalize the proper burner design. As technology for a wide fuel flexibility in Gas turbine technology has enabled following: external machine layout is unchanged already mentioned, the fuel system for power generation. natural-gas- and fuel-oil-fired combined- n New compressor vane-carrier casings (Fig 1). the low-Btu engine has to supply much This model will benefit by all the cycle plants to achieve efficiencies up to with minor changes on compressor higher flow rates to the burners than for experience gained in low-Btu fuel market 56-57%. Only in the last 15 years has a vanes. Combustion system the standard engine. by Ansaldo Energia with the V94.2K. The different requirement become important to n Compressor bearing casing changed in The two combustion chambers are arranged The fuel system (Fig 2) consists of large- model was officially released in 2008. the gas turbine market. A new business area the interface towards the compressor vertically on either side of the turbine and diameter pipe and control and stop valves, Ansaldo Energia is in negotiation with a is quickly growing requiring gas turbines vane-carrier casing. connected to lateral flanges on the turbine and must include additional mixing in order few customers for a new project relevant to be able to offer good performance also n Rotor unchanged, except for the casing. This design allows concentric to get the final blend of recovery gas, to the utilization of different blends of blast by using low-Btu fuels. removal of the first stage, but with the gas and air paths form the compressor natural gas, and, occasionally, steam. The furnace gas, coke oven gas, and oxygen. This new requirement is strictly related addition of two final stages with the to the combustion chambers and from presence of toxic and explosive components to the commercial success of IGCC same total length. the combustion chambers to the turbine, demands that the fuel system meet very high Ansaldo Thomassen Gulf: technology, which allows production of n No modification of hot components- involving relatively low flow velocities and safety standards. Thus all flanges and joints Fig 1: New AE94.2K2 compressor A new high-tech repair electric power from low-quality/low-cost -that is, the turbine and combustors thus minimum pressure drop. between the burners and the connection fuels (as refinery residual oils or low rank remain unchanged. The combustion chamber is provided point to the skids are welded. center in the Middle East coals) with an efficiency higher than boiler- n External casings are unchanged. with a refractory lining. Each combustion According to the gas turbine working With a major new investment, Ansaldo based power plants. n Burners with flow channels for gas chamber has eight separate burners conditions, engine loading is performed Energia has significantly increased its Furthermore, gasification technology of low heating value are designed in equipped for burning low-Btu fuel as main by using the back-up fuel, mainly for safety service sector dedicated to all customers is coupled to very effective gas cleaning relation to Wobbe index and optimized fuel and natural gas as a backup fuel. The reasons. Thus, a procedure for switch in the Middle East, one of the fastest technologies which, in addition to the good in relation to the fuel used. burner design is based on Ansaldo Energia’s over from back-up fuel to the main fuel developing areas in the world. Through performance of the gas turbine concerning n Plant layout and foundations remain previous experience on other low-Btu fuel is accomplished under full automatic its subsidiary Ansaldo Thomassen Gulf, the emissions problem, overcomes all the unchanged. projects (Isab Energy Priolo, Elettra Servola, control. Ansaldo Energia has built a futuristic new environmental problems related to the Enipower), redesigned, and tested in two The procedure is performed so that operations facility which was officially combustion of such fuels. Compressor redesign different test campaigns at Ansaldo Caldaie before the low-Btu fuel enters the combustor opened at the end of April 2010. The This requirement is also met when Depending on the LHV of low-Btu gas, and Combustion Centre and ENEL laboratories at the change over, its characteristics are inauguration ceremony was organized dealing with recovery gases from steel- Fig 2: Fuel feed system therefore the fuel flow rate input, a suitable in Italy in order to take into account the monitored and analyzed online. The fuel is with the backing of sheik Hamad bin mill processes that also can be burned in version of the V94.2 can be adopted in different boundary conditions which occur flared until the its properties and the design Zayed Al Nayan. Guests included Ansaldo a gas turbine instead of a traditional boiler order to optimize fuel consumption and for very low-Btu gases. specifications match. Once that happens, Energia CEO Giuseppe Zampini, Ansaldo with higher performance and efficiency. be gasified or the available by-product energy production. Table 3 presents several compositions the changeover procedure can start. Thomassen Gulf CEO Fausto Nepote, All the fuels coming from these processes gas, the chosen gasification technology, As mentioned above, the key factor to of low-Btu gases as blends of blast furnace Finally, a purging procedure before ZonesCorp CEO Mohammed Hassan are mainly constituted by a mixture of and the available added diluents (nitrogen cover the lower fuel range is compressor gas, coke oven gas, and oxygen. All are any syngas partial or full-load working Al Qamzi, and Paolo Dionisi, the Italian carbon monoxide, hydrogen, methane, and/or steam). redesign to reduce air flow capability. Main suitable for use in the AE94.2K2. condition must be done with nitrogen or ambassador to the Arab Emirates. and nitrogen. Looking at the table, note that the changes have been performed to the For some blends, natural-gas integration steam in order to avoid possible risks of The new facility, which has 3,200 sq m An example of the fuel opportunities typical low-Btu fuel range is covered by compressor stages, by removing the first is necessary to reach a suitable LHV. explosion due to the reactivity of the fuel of workshop floor and 880 sq m of offices, mentioned above is given by the Ansaldo Energia technology. In order to compressor stage and by redesigning the Basically the engine is expected to be when exposed to mixing with air. will play a fundamental role in satisfying experiences in this business area gained by maintain the leadership position in this compressor inlet duct to take into account ignited and loaded at 40% of base load the needs of the local market in terms of Ansaldo Energia (Table 1). All plants listed niche market, a continuous development the reduced IGV cross-sectional area. fueled by natural gas; after the change Performance quality and time. are equipped with AE94.2K gas turbines process has been implemented to allow The compressor inlet duct performance over to syngas, the engine can run on Table 4 shows the performance that Ansaldo Thomassen Gulf draws on the manufactured and directly supplied by the existing fleet to burn fuel with a lower also in the new design condition has been syngas with the natural-gas integration can be expected on V94.2 models when latest technology and the best human Ansaldo Energia. heating value (LHV) below 5.0 MJ/kg. checked by accurate 3D study. In addition necessary to get to base load. operating on singular fuels, in particular resources to provide an international All the AE94.2K machines are equipped In this fuel range, the standard AE94.2K to the modification to the compressor The critical point for the burner design the different types of low-Btu gases. centre of excellence in gas turbine repair with silo-type combustors and with a cannot be profitably employed due to first stage, to ensure proper operation process is facing different fuel compositions and maintenance, while eliminating high proper low-Btu burner to accommodate the excessive partialization which would in all working conditions, two additional as the gas turbine is loaded. Therefore Conclusions costs of international transport for its fuel features and plant requirements. Thus, be necessary to operate on compressor compression stages were also added at a detailed analysis has been performed The growing demand to supply gas customers. This represents a decisive step for each application it has been necessary inlet guide vanes. To maintain the proven the delivery side, in order to restore the taking into account the different cases turbines with very-low-Btu gases derived towards Ansaldo Thomassen Gulf’s goal of to introduce some optimization of the design of the K series, Ansaldo Energia previous surge margins. shown in the mentioned table. from steel-mill processes has driven the becoming a point of reference in the service burner design. has released the AE94.2K2, featuring This simple design concept allowed to This means that for each kind of fuel, introduction of Ansaldo Energia’s AE94.2K2, and repair market for all technologies of Table 2 provides an overview of the fuel reduced air compressor capability. This limit the number of components involved optimization of the standard low-Btu burner an engine developed for this specific niche turbine, offering an innovative service for characteristics in order to highlight the wide model accommodates the much more in the change as much as possible and must be performed, including a numerical market based on the relevant experience the first time in this area, with a structure range of compositions of these mixtures, stringent requirements of users of steel-mill to use components of proven geometry analysis (CFD with chemical routines) and achieved on AE94.2 (Table 5). Thus the that is rapid, professional, highly efficient, depending on the different feedstock to by-product fuel. (the last stages added are identical to the a experimental test campaign in order AE94.2 has proved to be the leading and easily accessible. Table 1: Ansaldo Energia’s low-Btu fuel project Table 2: Fuel properties Table 3: Typical low-Btu fuel composition Table 4: AE94.2 family performance Table 5: AE94.2 family features

10 India spread.indd 2-3 8/18/10 3:42:17 PM Sponsored Statement Sponsored Statement Making waste gas a business opportunity in the power generation industry www.ansaldoenergia.com

10 India spread.indd 2-3 8/18/10 3:42:17 PM Continued from page15 Central Power Research Institute (CPRI) plans to achieve 20,000 MW of installed solar power capacity by 2022 under the CPRI was established in Bangalore by the Government of India to serve as a national Jawarharlal Nehru National Solar Mission. laboratory for applied research in electric power engineering while functioning as an The plan aims to electrify thousands of independent national testing and certification authority for electrical equipment and villages, create jobs, help combat climate components. CPRI also offers expert consultancy services in the areas of transmission change and also achieve grid parity pricing and distribution, power quality, energy auditing, conductor vibration, power system by 2022. The target is set to be achieved instrumentation, transformer oil reclamation, power system application, high and in three phases: extra-high voltage, and related fields. n Phase I: A three-year phase from 2009- http://www.cpri.in/ 2012 to primarily focus on solar heating systems, which use proven technology and are commercially viable. The capacity National Hydroelectric Power Corporation additions are mainly going to be off-grid (NHPC) in the rural areas that do not have grid connections at present. The target is to NHPC is wholly owned by the Government of India. It plans, promotes, and organizes add 1,000 MW of off-grid capacity by integrated development of hydroelectric power in the country. With its present the end of Phase I. capabilities, NHPC can undertake all activities of hydroelectric projects, from conception n Phase II: Four years from 2013-2017 to commissioning. The company has executed 13 projects with an installed capacity of to use the experience gained in Phase 5,175 MW on ownership basis. It has also executed five projects on turnkey basis, with I to ramp up off-grid capacity as well as an installed capacity of 89.35 MW. Two of these projects have been commissioned in grid-connected supply. The target is to Nepal and Bhutan. NHPC also exploits other sources of renewable energy, including add 3,000 MW of renewable capacity geothermal, tidal, and wind. to the grid by 2017. The MNRE is http://www.nhpcindia.com/index.aspx planning to make solar water heaters mandatory through building bylaws and a new building code, effective National Thermal Power Corporation Ltd. mechanisms for certification and rating (NTPC) of manufacturers, measurement and promotion of these devices, and A wholly-owned company of the Government of India, NTPC is the largest thermal-power support for upgrading of technologies generating company in India. NTPC’s core business is concerned with engineering, and manufacturing capacities through construction, and operation of power-generating plants. It also provides consultancy soft loans. services to power utilities in India and abroad. NTPC’s installed capacity is 29,394 MW, The RPPOs, which would include including 15 coal-based power stations (23,395 MW), seven gas-based power stations a specific solar component for power (3,955 MW), and four joint-venture power stations (1,794 MW) among others. utilities, would be a key component. https://www.ntpc.co.in/ The obligation for this is expected to gradually increase, while the tariff fixed for solar-power purchase is expected to North Eastern Electric Power Corporation decline over time. Ltd. (NEEPCO) n Phase III: Five years from 2017-2022. The plan will also provide for the solar NEEPCO was incorporated to develop the power generation capability of India’s North lighting systems in 10,000 villages under East, which possesses about 40% of the country’s hydroelectric potential as well as a the on-going remote village electrification high potential for power from natural gas and coal. The Central Electricity Authority program and will also provide for setting estimates this region’s hydropower potential at approximately 58,971 MW. The region up solar power plants in Lakshadweep, also has natural-gas reserves of about 152 billion cubic meters, which can generate Andaman & Nicobar Islands and the about 7,500 MW of power for 10 years. Its 865 million tonnes of coal reserves could Ladakh regions. However, there is no produce 240 MW power per day for 100 years. NEEPCO’s installed capacity of 1,130 clear program for funding the project, MW includes both hydroelectric and thermal projects. which would require incentives and/or http://www.neepco.gov.in/ subsidies. Combined heat and Power Grid Corporation of India Ltd. power (POWERGRID) The policy foundation for combined One of the largest transmission utilities in the world, POWERGRID operates the regional heat and power (CHP) centers around and national electrical power grids. Its areas of operation include (1) the development bagasse-based cogeneration largely in of interstate transmission systems, including planning and design, construction, the sugar industry and supported as a quality assurance and inspection, and operations and maintenance; and (2) grid renewable-energy source. But CHP is management, including establishment of modern load dispatch centers, real-time grid conceptually much larger; it encompasses operation, scheduling and dispatch, and energy accounting, together with financial/ the idea of improving energy efficiency commercial settlements. POWERGRID has also diversified into the areas of broadband whether the primary fuel is renewable or telecom services, sub-transmission, distribution, and rural electrification. Each state has not. Industrial CHP has been of interest in its transmission network; some of the larger ones are Andhra Pradesh Transco, Karnataka India for over a decade, both to augment Power Transmission Corporation Ltd., and MAHA Transco. industrial energy supplies in the face of http://www.powergridindia.com/PGCIL_NEW/home.aspx endemic shortages and to use fuels of all kinds more effectively. The additional 18 2011 India Energy benefits of carbon mitigation also are being gradually recognized. Estimates of CHP in India have been scanty and based on differing definitions of CHP. The GoI estimate is restricted to bagasse-based cogeneration, whose current installed capacity of 719.83 MW is found predominantly in the states of Andhra Pradesh, Karnataka, Maharashtra, Tamil Nadu, and Uttar Pradesh. A study by The Energy and Resources Institute (TERI), covering 300 industrial units across 10 different sectors, estimates India’s CHP potential at 7,574 MW. More than two-thirds of that, 5,131 MW, is in the sugar industry alone. The CHP estimates are based on the internal heat-to-power ratios, which would meet the plant’s energy requirements, and on the existing production capacities of the various industry categories. The estimates do not cover the power-maximization options, which would significantly increase the CHP potential.

CHP potential is expected to grow with Powergrid the country’s expanding industrial base. Powergrid’s Sipat-Seoni line. India’s first of many planned 765-kV UHV lines runs over The IEA estimates that CHP potential will 350 km, connecting the states of Chhattisgarh and Madhya Pradesh, transmits 1500 MVA reach 27,800 MW in 2015 and 84,800 power from generation sources to load centres with greatly reduced transmission losses. MW in 2030. capacity, adding that the planned increase coordinate, supervise and control the Future prospects in generation in the coming decade will interstate transmission network. As of July require corresponding investments in 2009, POWERGRID owned and operated India has abundant renewable resources in transmission. about 71,500 circuit kilometers (ckm) of solar, hydro, biomass, and wind potential, POWERGRID, owned by the government transmission lines at 800/765 kV, 400 kV, 220 and the legal, policy, and regulatory of India, is the Central Transmission kV, 132 kV AC, and ±500 kV high-voltage environment is becoming more hospitable Utility (CTU) with the mandate to plan, DC, plus 122 substations with transformer to the increase of renewables in the energy sector. Along with SERC regulations on the RPPOs, the renewable energy certificates, Table 3-5. Transmission Sector and attractive rates for renewable power Central State Inter-state offered by CERC have moved renewables Transmission Lines (ckm) Sector Sector Network Total from the fringes of the energy basket to the mainstream. 765 kV 2,863 409 - 3,272 The MNRE has set aggressive targets 400 kV 61,491 27,970 3,243 92,704 for renewable energy, with projections 220 kV 10,119 115,172 151 125,442 approaching 25,000 MW by 2012. This ±500 kV HVDC Lines 5,848 1,504 — 7,352 would require an estimated investment of about $257 million. The MNRE has Sub-Stations (MVA) also made provision for subsidies of up to 765 kV 4,500 — — 4,500 $650 million. 400 kV 57,965 56,072 — 114,037 The National Solar Mission, established under the NAPCC, has set a goal of 220 kV 4,776 178,609 800 184,185 generating at least 10% of India’s power ±500 kV BTB HVDC Converter Terminal 7,000 1,700 — 8,700 from solar energy. It envisages increasing Source: CEA (as of Oct. 31, 2009) the production of solar photovoltaic panels to 1,000 MW per year from the current 235 MW per year and generating 1,000 MW Table 3-6. Distribution Line Length (km) of grid-connected solar power, up from the current 10 MW, by 2017. Region 33kV 22/20 kV 15/11 kV 6.6 kV 3.3/2.2 kV Up to 500 v Northern 71,381 5,579 598,408 — 46 917,056 Electricity delivery Western 74,962 29,830 612,157 1,852 — 1,202,137 Southern 50,465 37,112 541,299 — 19 1,671,796 The Ministry of Power’s ambitious goal of “Power for All by 2012” looks truly daunting Eastern 32,668 50 223,362 4,452 62 3,616,731 in light of the power sector’s current state. North Eastern 8,486 — 67,332 — — 85,795 The KPMG white paper cites the MoP’s Total (All India) 237,962 72,571 2,042,558 6,304 127 7,493,515 own statistics that installed transmission Source: CEA General Review 2008 (as on 31 March, 2007) capacity is only 13% of installed generation 19 capacity of about 81,200 MVA. This grid is Each state has a separate intrastate the transmission infrastructure in the maintained at an availability of 99%, and transmission grid that is connected to the country. about 45% of the total power generated in interstate transmission network owned Fig 3-7 illustrates the five interconnected the country is wheeled through it. by POWERGRID. Table 3-5 provides electrical regions across the country.

Satluj Jal Vidyut Nigam Ltd. (SJVN) More electricity sector entities This organization was incorporated as a joint venture between the Government of India capacity of 500 MW in Ahmedabad. Another Power trading and ex- and the Government of Himachal Pradesh 1,145.75-MW combined-cycle power plant change to plan, promote, organize and execute is under construction. Torrent Power is also hydroelectric power projects in the Satluj Power Trading Corporation of India engaged in the transmission and distribution River Basin in Himachal Pradesh. Ltd. (PTC) of electricity. http://sjvn.nic.in PTC India was incorporated in 1999 http://www.torrentpower.com to develop a full-fledged, efficient, and Narmada Hydroelectric Development Calcutta Electric Supply Corporation competitive power market, attract private Corporation Ltd. (NHDC) Ltd. (CESC) investment in the Indian power sector, and A joint venture of the NHPC and the CESC has a total generation capacity of 975 encourage power trade with neighboring Government of Madhya Pradesh, NHDC has MW at four thermal power stations in West countries. been entrusted with the construction of Indira Bengal. CESC also has a presence in the http://www.ptcindia.com Sagar Project (1,000 MW) and Omkareshwar fields of establishing transmission network Project (520 MW). It is the largest organization Indian Energy Exchange (IEX) and cable manufacturing, and provides for hydropower development in the state of IEX is a nationwide, automated, and online consultancy services in the operation and Madhya Pradesh. electricity trading platform. It has been maintenance of power plants. http://www.nhdcindia.com conceived to catalyze the modernization of http://www.cescltd.com/cesc/menu. electricity trade in the country by ushering html# in a transparent and neutral market through Nuclear sector entities a technology-enabled electronic trading Jindal Power Ltd. (JPL) JPL, a subsidiary of Jindal Steel and Power Nuclear Power Corporation of India platform. Ltd. (NPCIL) http://www.iexindia.com Ltd., has a coal-based 1,000-MW thermal power plant in Chhattisgarh and has signed NPCIL has been set up to operate nuclear Power Exchange India Ltd. (PXIL) memoranda of understanding with the power stations and implement nuclear power Operating since late October 2008, PXIL governments of Jharkhand and Chhattisgarh projects for the generation of electricity. Its is the exchange for electricity contracts to increase power generation capacity. 17 nuclear power units have a combined on a day-ahead basis with voluntary http://www.jindalpower.com capacity of 4,120 MW. participation. Since then, PXIL has received http://www.npcil.nic.in further approval from the Central Energy Damodar Valley Corporation (DVC) Apart from being involved in the general Bharatiya Nabhikiya Vidyut Nigam Regulatory Commission to introduce longer- Ltd. (BHAVINI) tenure physical delivery products in the form social and economic upliftment of the Damodar Valley in northeastern India, DVC is BHAVINI has been incorporated to of weekly and day-ahead contingency construct and commission the first 500- products. PXIL is promoted by the National engaged in the generation and transmission of electricity in the area. It generates 144 MW MW fast breeder reactor and to pursue Stock Exchange of India Ltd. (NSE), and the construction, commissioning, operation, National Commodity & Derivatives Exchange of hydroelectric power and 2,652.5 MW of thermal power. The DVC transmission system and maintenance of subsequent FBRs for Ltd. (NCDEX). power generation. http://www.powerexindia.com is spread across Jharkhand, West Bengal, and Orissa. http://www.bhavini.nic.in/main.asp Power generation http://www.dvcindia.org/index.htm Bhabha Atomic Research Centre Bhakra Beas Management Board (BARC) Reliance Energy Ltd. (REL) (BBMB) BARC is a multidisciplinary nuclear research REL generates 941 MW of electricity and has BBMB administers, operates and maintains centre having infrastructure for advanced several gas-, coal-, wind-, and hydro-based irrigation and hydroelectric power projects research and development, with expertise power generation projects at various stages with 2,906 MW total capacity. It is also covering the entire spectrum of nuclear of development, with an aggregate capacity currently constructing three hydropower science and engineering and related of over 13,510 MW. Reliance Energy is also projects with an aggregate capacity of 19 areas. engaged in the transmission and distribution M W. http://www.barc.ernet.in of electricity. http://bbmb.gov.in/english/index.asp http://www.rinfra.com Indira Gandhi Centre for Atomic Tehri Hydro Development Corporation Research (IGCAR) The Tata Power Company Ltd. Ltd. (THDC) IGCAR has been set up with the main Tata Power has an installed thermal, THDC is a joint venture between the objective of conducting broad-based hydroelectric and wind generation capacity Government of India and the Government multidisciplinary programs on scientific of more than 2,300 MW. Tata Power of Uttar Pradesh to plan, promote and carry research and advanced engineering, directed has a joint venture with the Power Grid out integrated and efficient development of towards the development of sodium-cooled Corporation of India for its 1,200-km Tala hydro resources of Bhagirathi River and its fast breeder reactor technology in India. Transmission Project. tributaries at Tehri, along with complementary http://www.igcar.ernet.in http://www.tatapower.com downstream development for power Atomic Minerals Directorate for Torrent Power Ltd. generation and other services. Exploration and Research (AMD) Torrent Power has an installed generation http://thdc.gov.in AMD is entrusted with the survey of atomic

20 2011 India Energy

These inter-regional connections generation potential is greater in the southern, northern, and western parts are very important to India as power east and northeast. As new plants of the country. Future generation will supply and power demand are not are built, their power will need to necessarily be concentrated where coal matched across the regions. Power- flow to power-deficit states in the resources are abundant in the states of Bihar, Jharkhand, West Bengal, and Chhattisgarh in the eastern region as minerals in India, with exclusive rights to RE manufacturing well as the northeastern states where explore for uranium and other minerals the hydropower potential exists. required for the nuclear industry. It also Suzlon A further strengthening of the national conducts geological/geotechnical studies Suzlon is a leading India-based wind-turbine power grid is envisaged through high- related to site selection for nuclear power maker with over 14,000 people in 21 capacity alternating-current extra-high- plants and repositories for the disposal of countries and operations across the Americas, voltage lines, 765-kV AC lines, and high- radioactive waste generated from nuclear Asia, Australia and Europe. It has a fully voltage direct-current lines. This phase power plants. integrated supply chain with manufacturing should be implemented by 2012 when http://www.amd.gov.in inter-regional power transfer capacity facilities in three continents, sophisticated R&D will be enhanced to about 37,700 MW Renewable-energy sector capabilities in Denmark, Germany, India and by the end of the XI Plan, depending on Research and development The Netherlands and is the third-largest wind the growth of the generation capacity. turbine manufacturer in the world. But current inter-regional transfer capacity Sardar Swaran Singh National Institute http://www.suzlon.com is just 20,750 MW, according to the of Renewable Energy (SSS-NIRE) MoP, making the goal an extraordinary SSS-NIRE is an autonomous institution Tata BP Solar India Ltd. challenge. that serves as a technical focal point for Tata BP Solar is a Joint Venture between Grid management is carried out using the development of bio-energy, including Tata Power Company and BP Solar, one of Supervisory Control and Data Acquisition biofuels and synthetic fuels. the largest solar companies in the world. (SCADA) with the National Load Dispatch http://mnre.gov.in/nire-rdd.htm Tata BP Solar has a fully integrated solar Center (NLDC) at Delhi and five Regional Load Dispatch Centers. Each state has a Alternate Hydro Energy Centre manufacturing plant in Bangalore, which state load dispatch center (SLDC) which (AHEC) in April 2010 completed a project to add operates the grid. AHEC is an academic center of the Indian 32 MW of photovoltaic-cell production to its Institute of Technology, Roorkee, with the existing 52-MW line. By early next year, the Distribution mission to promote power generation company plans to achieve 180 MW of cell through the development of small capacity, and ultimately 300 MW by 2012. Electricity distribution is a state government hydropower projects in hilly as well as plain responsibility in India. State Electricity areas. It also promotes development of Tata BP Solar’s talent pool comprises over 600 employees spread over four manufacturing Boards (SEBs) were set up as vertically decentralized integrated energy systems in integrated monopolies in each state after units and eight offices. conjunction with other renewable-energy Independence, but some private-sector sources such as biomass, solar, and wind. http://www.tatabpsolar.com companies continued to exist. The Bombay http://ahec.org.in Suburban Electricity Supply Co. (BSES) in Centre for Wind Energy Technology Power distribution Mumbai (taken over by Reliance Energy in (C-WET) Electricity distribution is in the public and 2003), Ahmedabad Electricity Company C-WET is an autonomous research and private sector. In the public sector, electricity (AEC), and Surat Electricity Co. (SEC), taken development institution working in the field distribution is either an unbundled distribution over by the Torrent Group in 1998, and of wind energy. C-WET’s services include Calcutta Electricity Supply Company (CESC), business or part of the vertically integrated which continues to be owned by the RPG developing components and sub-systems State Electricity Board. for wind turbines, identifying resource-rich group. regions in the country, testing complete Bangalore Electricity Supply Company With power-sector reforms in the 1990s, several states unbundled and restructured wind turbine generator systems according Ltd. (Bescom) to international standards, preparing their electricity sectors and created two BESCOM has responsibility for distribution of to five small distribution companies. standards suitable for Indian conditions, electricity in eight districts covering 41,092 sq and collecting, collating, and analyzing Table 3-6 is a summary of the distribution km with a population of nearly 14 million and the related information to serve as an infrastructure in the country. information center in the field of wind a consumer base of 6,363,764. Its system High distribution-line losses are among energy. includes 112,745 distribution transformers, the most vexing problems in the Indian power sector. India’s aggregate technical http://www.cwet.tn.nic.in 62,941 circuit-km of high-tension lines, and 140,067 circuit-km of low-tension lines. and commercial losses average about 32% Solar Energy Centre (SEC) of electricity. The Restructured Accelerated SEC acts as a national test and North Delhi Power Ltd. (NDPL) Power Development and Reform Program standardization center for solar energy NDPL is a joint venture between Tata Power (R-APDRP) of the Ministry of Power aims materials, components, and systems; Company and the Government of the to reduce these losses to below 15%. Many urban areas have shown a decline collaborates with other research institutions National Capital Territory of Delhi, with the and industry on research projects; provides in losses, but the rural areas continue to majority stake being held by Tata Power. It advisory and consultancy services to the be mismanaged. Latest estimates indicate industry and users; and evaluates new distributes electricity to 1 million customers that line losses average 27.2% and in some technologies, products, and systems for in north and northwest parts of Delhi with states exceed 60%. Table 3-7 indicates their adaptability to Indian conditions. a peak load of around 1,180 MW. the distribution of line losses in India by http://mnre.gov.in/sec/sec-objective.htm http://www.ndpl.com state. Losses average almost 30% in the 21 Grid operators The state transmission utilities, such as AP Transco, Delhi Transco, Karnataka Power Transmission Corporation Ltd., and the central transmission utility, POWERGRID, are responsible for the intrastate and interstate transmission networks. The SLDCs under the state transmission utilities and the RLDCs and NLDC under POWERGRID are responsible for grid management. In the emerging scenario, policy makers have suggested that grid operation functions need to be “ring fenced” if not hived into a separate entity. This is yet to happen. The NLDC is the apex body in the hierarchy of the national grid system. The launch of the NLDC in September 2009 has

Powergrid set the stage for synchronous operation of Smart Grid technology. The NRLDC instituted a pilot program in May 2010 to install four the national grid on a real-time basis and for Phasor Measurement Units (PMUs) with GPS at substations near Delhi to assist grid operators smooth power transfers across regions. with real-time data, visualization software for situational awareness, and data archiving for predictive analytics. Distribution operations India’s distribution network starts at Table 3-7. T&D Losses by State (2007-08) the 33-kV substation and ends at the 0-15% 15-25% 25-35% 35-45% 45-55% Above 55% customer’s meter, or doorstep in the case of unmetered rural domestic customers. Puduchery Himachal Delhi Uttarkhand Bihar Jammu & Each state has its own distribution network, Pradesh Kashmir and the old vertically integrated SEBs have Punjab Haryana Madhya Pradesh Arunachal been unbundled into smaller distribution Pradesh companies in many states. Chandigarh Rajasthan Orissa Manipur In Delhi and Orissa, distribution Goa Uttar Pradesh Sikkim Nagaland companies have been privatized as joint ventures with entities owned by the state Daman & Diu Gujarat Assam government. There are also several private Dadra & Chhattishgarh Meghalaya distribution companies that have operated Nagar Haveli for several decades, as described above. Andhra Pradesh Maharsthra Mizoram Some states like Tamil Nadu and Punjab Karnataka Andaman Tripura continue to have a single distribution entity & Nicobar for the entire state. Recently, attempts have been made to Kerala franchise out segments of the distribution Tamil Nadu business to private entities to bring in Lakshadweep improvements. Torrent Power, for example, took over the Bhiwandi area Jharkhand (near Mumbai) under an input-based West Bengal franchisee model. Source: Compiled from Data in General Review 2009, CEA India’s distribution system included more than 6.76 million ckm of lines and over 282,000 MVA of distribution transformer Eastern and Western Regions and even In addition, rural areas with significant capacity as of March 2008. This is assumed higher—43.4%—in the northeastern loads, works of separation of agricultural to be growing at an annual average rate region. The southern region fares the and domestic feeders and of high-voltage of around 3% and 7.5%, respectively. best with T&D losses of 19.77%. The distribution system (11 kV) would also be The Rajiv Gandhi Grameen Vidyuthikaran GoI’s R-APDRP focuses on demonstrated, taken up. Yojana (RGGVY), aimed at rural electrification, sustained loss reduction. The Central Funding for this project consists of a is an initiative to provide focus and funds to Power Research Institute (CPRI) is the 100% loan for all projects selected. As rural distribution. As of 15 February 2010, epicenter of research and development the project nears completion and the a total of 567 projects were sanctioned, at for transmission and distribution systems required targets are met, the loan will be a cost of $5.5 billion, electrifying 418,499 in India. Under the XI Plan, their role progressively converted to a grant. For un/de-electrified villages. as Information Technology consultants utilities having Aggregate Technical and The estimated electricity customer base assists state utilities to develop baseline Commercial (AT&C) losses of above 30%, of 160 million is growing at an annual studies and to monitor T&D projects. the expected reduction would be 3% per rate of about 4.5%. The average per- All urban areas with a population of year. For utilities with AT&C losses below capita consumption of 704 kWh in 2007- more than 30,000 (10,000 in the case of 30%, the expected reduction would be 08 is expected to surpass 1,000 kWh by special-category states) would be covered. 1.5% per year. 2011-12. 22 2011 India Energy

Offshore exploration. NELP IX, expected to launch by the end of 2010, will offer up about 45 new oil and gas blocks for auction. After a disappointing NELP VIII where less Oil & Gas sector than half of the blocks were awarded, the GoI remains optimistic for the upcoming auction as crude prices have stabilized at around $80 bbl.

were drilled in onshore and offshore areas. The onshore regions are predominantly in the states of Assam and Gujarat while the offshore regions are near Mumbai. In 1999, the NELP took effect. Since then, the Ministry of Petroleum and Natural Gas has signed 203 production-sharing contracts under seven rounds of bidding. In the seventh round of bidding under NELP VII, 181 bids were received from 95

Cairn companies including 21 foreign companies (Table 4-3). Exploration and than the previous year. However, gross The NELP has facilitated 68 oil and gas production of natural gas in the country discoveries made by private and joint- Recovery stood at 32.85 BCM in the same period venture companies in 19 blocks, adding Despite increased exploration and and 1.33% higher than the previous year more than 600 MTOE hydrocarbon production activities in the country by both (Table 4-2). reserves. As of April 1, 2009, investment national oil companies and private players, During 2008-09, 381 exploratory and commitment on exploration under NELP India depends on imported crude to meet development wells totaling 888,000 meters was about $10 billion, against which 75% of domestic demand. As shown in Table 4-1, as of April 1, 2009, India had total reserves of 775 million tonnes of Table 4-1. Oil and Gas Table 4-2. Petroleum crude oil and 1,074 billion cubic meters Reserves Industry Production for of natural gas. Crude Oil (MMT) 2005 2009 2008-09 Production of crude oil has stagnated, Reserves (Balance Recoverable) but there have been a number of natural- Onshore 376 405 gas discoveries in India. With the discovery Offshore 410 369 Crude Oil (MT) 770 of gas in the Krishna-Godavari Basin (KG Total 786 775 Natural Gas (BCM) 1,090 Basin), there has been a perceptible Natural Gas (BCM) Production (MT) change in the estimates of natural-gas reserves in India’s sedimentary basin. Onshore 340 287 Crude Oil 33.51 Most of the new gas discoveries have Offshore 761 787 Petroleum Products 152.68 been made by private players who have Total 1,101 1,074 Consumption (MT) bid for the exploration blocks under the Crude Oil 160.77 GoI’s New Exploration Licensing Policy Sources: ONGC, OIL, DGH Note: The oil and natural gas reserves Petroleum Products 124.17 (NELP). (proved and indicated) data relate to 1st Crude oil production during 2008- April of each year Source: Ministry of Petroleum and Naural Gas

09 at 33.51 MMT was 1.79% lower Bechtel Reliance Industries’ Jamnagar Refinery.Already the largest greenfield refinery in the world, the expansion completed by Bechtel in 2008 nearly doubled the output of Jamnagar to 1.24 million barrels per day of nominal crude processing capacity, representing one-third of India’s capacity. 23 actual expenditure so far is about $4.7 Table 4-3. Progress Under the New Exploration License Policy billion. In addition, $5.2 billion has NELP I NELP II NELP III NELP IV NELP V NELP VI NELP VII been invested on the development of discoveries. Blocks awarded 25 23 23 21 20 52 44 The NELP effort opened up deepwater PSCs signed 24 23 23 20 20 52 41 offshore areas of the country for exploration, and seven rounds of NELP Signed in 2000 2001 2003 2004 2005 2007 2008 increased the area under exploration to Area awarded 48% of the Indian sedimentary basin area 194,735 263,050 204,588 192,810 115,180 306,200 121,000 (km2) from 11% before the implementation of Source: Ministry of Petroleum & Natural Gas NELP. Hydrocarbon reserves accretion had been more than 600 million tonnes of oil

Oil & Gas sector entities Integrated oil companies development, and production of crude oil naphtha, motor spirit, aviation turbine and natural gas, and transportation of fuel, kerosene, raw as well as calcinated Hindustan Petroleum Corporation crude oil and production of LPG. petroleum coke, and sulfur. Ltd. (HPCL) http://www.oil-india.com http://www.nrl.co.in HPCL is an integrated oil refining and http://www.bharatpetroleum.com marketing company with 16% of the market Gujarat State Petroleum Corporation share and 10.3% of the nation’s refining Ltd. (GSPC) Mangalore Refinery and capacity. Its two coastal refineries in Mumbai GSPC is India’s only state-government- Petrochemicals Ltd. (MRPL) and Visakhapatnam have a combined owned company in the oil and gas A subsidiary of the ONGC, the MRPL is capacity of 13 MTPA. HPCL also owns and E&P business. From a small oil and gas a grass-roots refinery with a capacity of operates the country’s largest lube refinery, producing company in Gujarat, it has 9.69 MTPA. It has a versatile design, which which has a capacity of 335,000 tonnes. become a vertically integrated large-scale gives high flexibility for processing crude http://www.hindustanpetroleum.com/En/ energy organization in India, excelling in a oils of various API weights, providing a UI/Home.aspx wide gamut of hydrocarbon activities. high degree of automation. This refinery’s http://www.gspcgroup.com/gspc.html petroleum products include LPG, naphtha, Bharat Petroleum Corporation Ltd. motor gasoline, diesel, gas oil, kerosene, Cairn India Ltd. (BPCL) aviation fuel, furnace oil, low sulfur heavy Cairn is engaged in the E&P of crude oil and BPCL is engaged in both refining and retail stock, bitumen, reformate, feedstock, and natural gas. Cairn India operates offshore business. It has refineries in Mumbai and sulfur. platforms, approximately 200 km of subsea Kochi, with a combined capacity of 19.5 http://www.mrpl.co.in pipelines, and two processing plants. MTPA for refining crude oil. BPCL is also http://www.ongcindia.com/english.asp engaged in the retailing of gasoline, diesel, http://www.cairnindia.com kerosene, jet fuel, LPG, a range of oils and greases, and various non-fuel products. Refineries Marketing Companies http://www.bharatpetroleum.com Chennai Petroleum Corporation Ltd. Gas Authority of India Ltd. (GAIL) Reliance Industries Ltd. (RIL) (CPCL) GAIL is India’s principal gas transmission and RIL has been realizing value across the entire CPCL, a subsidiary of the Indian Oil marketing company, and has expanded energy chain. It has been involved in the Corporation Ltd., has two refineries with into gas processing, petrochemicals, LPG exploration and production of oil and gas as a combined refining capacity of 10.5 transmission, and telecommunications, well as refining and marketing of petroleum. MTPA, mainly producing LPG, motor spirit, as well as into power, LNG regasification, The company has 34 domestic exploration superior kerosene, aviation turbine fuel, city gas distribution, exploration, and blocks covering an area of about 331,000 high-speed diesel, naphtha, bitumen, lube production through equity and joint km2, one exploration block each in Yemen base stocks, paraffin wax, fuel oil, hexane, venture participation. and Oman, and five coal-bed methane and petrochemical feedstocks. http://www.gailonline.com/gailnewsite/ blocks. Reliance’s 60-MTPA refinery at http://www.cpcl.co.in index.html Jamnagar, Gujarat, is the world’s largest. Bongaigaon Refinery and Indraprastha Gas Ltd. (IGL) http://www.ril.com Petrochemicals Ltd. (BRPL) A joint venture of GAIL, the BPCL, and Essar Oil Ltd. (EOL) BRPL, also a subsidiary of the IOCL, is the the Government of NCT (National Capital An integrated oil and gas company, the first indigenous grass-roots refinery in the Territory), Delhi, the IGL has established a EOL has E&P rights in several blocks in country, integrated with a petrochemical network for the distribution of natural gas to the country. Its 10.5-MTPA refinery at complex at a single location. BRPL has a consumers in the domestic, transport, and Vadinar, Gujarat, started production in total refining capacity of 2.35 MTPA and commercial sectors in the NCT of Delhi. 2008. It has been built with the state-of- produces LPG, naphtha, kerosene, gas oil, http://www.iglonline.net the-art technology and has the capability and reduced crude oil. Mahanagar Gas Ltd. (MGL) to produce gasoline and diesel for India as Numaligarh Refinery Ltd. (NRL) A joint venture of GAIL, the BG Group well as advanced international markets. NRL, a subsidiary of the Bharat Petroleum (formerly British Gas), and the Government http://www.essar.com Corporation Ltd, is a petroleum refining of Maharashtra, the MGL provides piped company designed to process 3 MTPA of natural gas to households and compressed E&P companies indigenous crude oil with state-of-the-art natural gas for transportation across Oil India Ltd. (OIL) technology. This refinery mainly produces Mumbai. OIL is engaged in the business of exploration, high-speed diesel. It also produces LPG, http://www.mahanagargas.com

24 2011 India Energy

Table 4-4. Existing and Proposed Liquefied Natural Gas Terminals Project and Developer Location (State) Capacity (MTPA) Supplier Status Dahej LNG Terminal Dahej (Gujarat) 6.5 (to be Rasgas (Qatar-based Commissioned in February (Petronet) expanded to 10) LNG supply company) 2004 and commercial sales and spot cargoes began in April 2004 Hazira LNG (Shell and Total) Hazira (Gujarat) 2.5 (phase I) Spot cargoes Commissioned in April 2005 Dabhol Terminal (owned by Dabhol (Maharashtra) 5 Not finalized 75% complete (commissioning Ratnagiri Gas and Power Co) delayed due to no firm supply contracts) Kochi LNG (Petronet LNG) Kochi (Kerala) 2.5 Not finalized Project expected to be completed by 2011 Ennore LNG (IOCL, CPCL) Ennore (Tamil Nadu) 2.5 Not finalized Planned Mangalore (ONGC and MRPL) Mangalore (Karnataka) 2.5 Not finalized Planned Source: TERI equivalent. Under the NELP program, annum capacity. IOCL operates three 68 oil and gas discoveries have been crude oil pipelines: made in 19 exploration blocks. A total of Indian Oil n Salaya-Mathura-Panipat pipeline, 1,870 149 blocks are under operation under Corporation Ltd. km, 21 MTPA capacity production-sharing contracts. n Paradip-Haldia-Barauni pipeline, 1,302 NELP VIII in 2009 offered 70 exploration (IOCL) km, 7.50 MTPA capacity blocks comprising 24 deepwater blocks, IOCL is currently India’s largest integrated n Mundra-Panipat pipeline, 1,174 km, 6 28 shallow-water blocks, and 18 onshore oil company. Along with its subsidiaries, MTPA capacity blocks. These 70 blocks cover a sedimentary it accounts for 49% of market share of In 2008-09, product pipelines including area of about 164,000 km2, or about petroleum products among public-sector for LPG totaled 12,017 km with a capacity 5.2% of the Indian sedimentary basin oil companies, 40.4% of national refining of 68.19 MTPA. Capacity utilization was area. The 18 onshore blocks fall in the capacity, and 69% of downstream about 77%. states of Assam (2), Gujarat (8), Haryana product pipeline capacity. The Indian Natural-gas pipelines are currently (1), Madhya Pradesh (3), Manipur (2) and Oil Group of Companies owns and limited but are expected to become West Bengal (2). In the western, eastern, operates 10 of India’s 19 refineries, with more extensive with the increase in the and Andaman Offshore regions, there a combined refining capacity of 60.2 availability of gas. All of India’s principal are 28 shallow-water and 24 deepwater million tonnes per annum. These include gas pipelines move gas from the Gujarat blocks. two refineries of its subsidiary Chennai coast northeastward to destinations in Petroleum Corporation Ltd. (CPCL) and Uttar Pradesh and Haryana. Refining one refinery of Bongaigaon Refinery The most important pipeline in the and Petro Chemicals Ltd. (BRPL) The country is the 2,800-km-long HBJ pipeline The refining capacity in the country stood company has a crude-oil and product (Hazira-Bijapur-Jagdishpur), with a capacity at 177.97 million tonnes per year on April pipeline network spanning nearly 9,300 of 60 million standard cubic meters per 1, 2009, an increase of more than 19% km across the country, with a capacity day. This pipeline supplies gas mainly to over the previous year. Consequently, total of 61.72 MTPA. the power and fertilizer plants in northern refinery throughput in 2008-09 of 160.77 http://www.iocl.com/home.aspx and western India. million tonnes was up 3% over the previous http://www.cpcl.co.in/ In addition to the HBJ pipeline, there year, with a pro-rata capacity utilization are regional gas pipelines of varying of 107.9%. sizes in the north Gujarat region (142 Consequently, the country is a net km), South Gujarat region (257 km), and importer of crude oil (128.155 million Andhra Pradesh’s KG Basin (728 km) tonnes valued at $72.8 billion) while Oil and Natural Gas among others. Many of these pipelines being a net exporter of petroleum products Corporation Ltd. were initially built by the Oil and Natural (18.647 million tonnes valued at $12 (ONGC) Gas Corporation Ltd. and OIL, but were billion). India is emerging as a refinery subsequently taken over by the Gas hub as more capacity is added and Indian ONGC is the largest company engaged Authority of India Ltd. in 1992. companies are venturing abroad to set in the exploration and production of up refineries. oil and natural gas in the country. It Liquefied natural gas is the only fully integrated petroleum (LNG) Oil & Gas pipelines company in India, operating along the entire hydrocarbon value chain. ONGC Importing LNG is one of the ways India As of March 31, 2009, the total length of Videsh Ltd. (OVL), a wholly owned is bridging the demand-supply gap of crude oil pipelines crossing the country subsidiary of the ONGC, manages energy sources. Two LNG terminals, both stood at 5,559 km owned by Oil India the international E&P business for the in Gujarat, currently are operating: the Ltd. (OIL) and Indian Oil Corporation acquisition of overseas reserves. 6.5-MTPA Dahej terminal and the 2.5- Ltd. (IOCL). OIL owns the 1,405-km-long www.ongcindia.com/english.asp MTPA Hazira terminal. Table 4-4 outlines Duliajan-Digboi-Bongaigaon-Barauni www.ongcvidesh.com four more terminals at various stages of pipeline, with 7.68 million tonnes per development. 25 Coal is king. Growing demand for coal will eventually overburden the current railway system resulting in fuel shortages for power generation stations. Improvements to the current infrastructure and new means of coal transport, such as ferry and coal-slurry pipelines, are being explored to ensure energy security for India.

The public sector still dominates the mining and production of coal in India. CIL, along with its subsidiaries, has a market share of over 83%. The next-largest—the joint state and central government SCCL— has an 8.6% share. But opportunities for foreign and private investment can also be found. In June 2010, South Africa-based Sasol Coal sector Ltd. announced plans to spend $10 billion in a 50-50 joint venture with Tata Group on a coal-to-fuel project in Orissa, with the

Coal India goal of producing 80,000 barrels-per-day of motor fuel by 2018. And CIL scheduled a $2.8-billion initial public offering for late oal provides more than one-quarter Commission’s Integrated Energy Policy July 2010, although it was subsequently of the world’s primary energy and anticipates a steep rise in demand for coal, postponed to September. Cis used to generate nearly 40% particularly to meet the country’s power of its electricity. India’s coal consumption needs (Table 5-2). Exploration and ranks third in the world, and the country’s The Ministry of Coal determines demand for coal continues to grow much policies and strategies for exploration recovery faster than the world average. Table 5-1 and development of coal and lignite The Geological Survey of India, Central estimates its recoverable reserves at 101.9 reserves as well as all matters relating to Mine Planning & Design Institute Ltd., and billion tonnes, about 10% of the total world coal production, supply, distribution, and Mineral Exploration Corporation Ltd. have reserves of both lignite and coal. pricing. Its public-sector undertakings estimated total coal reserves at 267.21 Coal and lignite meet about 50% of include Coal India Ltd.(CIL), Neyveli billion tonnes as a result of exploration India’s commercial energy requirements. Lignite Corporation Ltd., and the Singareni activities carried out at depths up to 1,200 More than 75% of the coal and lignite is Collieries Company Ltd. (SCCL), which is meters. Table 5-3 breaks down these consumed by the country’s power sector. a 51-49 joint sector undertaking between reserve estimates to the state level. Cement and steel (coking coal) are the the Government of Andhra Pradesh and Many coal resources are available in other significant consumers. The Planning the GoI. sedimentary rocks of older Gondwana

Table 5-1. World Recoverable Coal Table 5-3. Distribution of Coal Resources Reserves (billion tonnes) (million tonnes) Region/Country Coal Lignite Total State Proved Indicated Inferred Total World Total 827.4 173.4 1,000.8 Andhra Pradesh 9,194 6,748 2,985 18,927 United States 234.7 36 270.7 Arunachal Pradesh 31 40 19 90 Russia 161.6 11.5 173.1 Assam 348 36 3 387 China 89.1 20.5 109.6 Bihar — — 160 160 India 99.3* 2.6 101.9 Chhattisgarh 10,910 29,192 4,381 44,483 Source: Expert Committee on Coal Reforms * Total proved “in place” reserves instead of recoverable Jharkhand 39,480 30,894 6,338 76,712 reserves relevant for other countries Madhya Pradesh 8,041 10,295 2,645 20,981 Maharashtra 5,255 2,907 1,992 10,154 Table 5-2. Coal Demand Projections Meghalaya 89 17 471 577 (million tonnes) Nagaland 9 — 13 22 Plan Period Power Non-Power Total Orissa 19,944 31,484 13,799 65,227 XI 2011/12 436 164 627 Sikkim — 58 43 101 XII 2016/17 603 221 824 Uttar Pradesh 866 196 — 1,062 XIII 2021/22 832 299 1,131 West Bengal 11,653 11,603 5,071 28,327 XIV 2026/27 1,109 408 1,517 Total 105,820 123,470 37,920 267,210 XV 2031/32 1,475 562 2,037 Source: Ministry of Coal (as of April 1, 2009) Source: Integrated Energy Policy, Planning Commission 26 2011 India Energy

recommended by the Standing Linkage Table 5-4. Coal Resources in Sedimentary Rock Committee. (million tonnes) Formation Proved Indicated Inferred Total Coal-bed methane Gondwana Coals 105,343 123,380 37,414 266,137 Investor response was lukewarm in 2001 Tertiary Coals 477 90 506 * 1,073 to the first round of bidding for blocks Total 105,820 123,470 37,920 * 267,210 to develop coal-bed methane. But by *Includes 456 million tonnes of Inferred resources established through mapping in 2006, both national and international Northeastern region. players were seeing a change in the commercial viability of CBM, and the third round that year was marked by a perceptible rush to grab a share of the Table 5-5. Allocation of Table 5-6. Coal Letters of action. Now, after three rounds of CBM Assurance (LOA) bidding, 26 blocks have been offered Coal Blocks to Private Quantity Companies Number Approved and 23 CBM exploration blocks have Geological Name of Sector Approved (MTPA) been signed. Reserves More than 6 trillion cubic feet (TCF) of Power Utilities 15 57 Sector/End Use Blocks (MT) reserves have already been established Power 20 2,702 Captive Power in four CBM blocks. First commercial Plants including 224 42 Iron and Steel 47 6,703 production of CBM commenced in the Cement CPPs country in July 2007 at the rate of about Small and Isolated 2 9 Independent Power 72,000 cubic meters per day. Table 5-7 Cement 3 232 Producers 12 24 displays the details of the CBM blocks Cement Plants 72 21 awarded so far. Ultra Mega 7 2,607 Power Project Sponge Iron Units 236 17 The fourth round of CBM Policy offers 10 blocks covering an area of about 5,000 Total 79 12,254 Total 559 161 km2 falling in the states of Assam (1), part Source: Annual Report 2007-08, Ministry of Chhattisgarh and part Madhya Pradesh Coal, GoI Source: Annual Report 2007-08, Ministry of Coal, GoI (1), Jharkhand (2), Madhya Pradesh (2), Maharashtra (2), Orissa (2) and Tamil Nadu (1). The total exploration period has been formations of peninsular India and younger allocated to Public Sector Undertakings. reduced from eight years to five. Tertiary formations of northeastern/ Private companies have been allocated northern hilly region. Based on the results 100 blocks with geographical reserves of Shale oil of regional/promotional exploration, 17.93 billion tonnes and production has where the boreholes are normally placed begun in 23 blocks. A preliminary assessment of the sedimentary 1-2 km apart, the resources are classified During 2007-08, 45 coal blocks with rocks in India suggests that there could be as “indicated” or “inferred.” Subsequent total geological reserves of 11.386 billion around 137 billion tonnes of oil available detailed exploration in selected blocks, tonnes were allocated to public and private in shale in Assam and Arunachal Pradesh where boreholes are less than 400m apart, companies, of which 21 blocks with total alone. The Cambay basin, off the Gujarat upgrades the resources into the more- geological reserves of 8.64 billion tonnes Coast, also has shale gas deposits. Of this, reliable “proved” category. Table 5-4 reports were allocated to public and private around 10% is estimated to be recoverable the results as of April 1, 2009. companies in the power sector. Table 5-6 reserves. Thus, of the estimated reserves of shows the commitment of coal supply The Directorate General of 267 billion tonnes, 105 billion tonnes through the letter of assurance (LOA) Hydrocarbons (DGH) plans to come up are Proved. Even on the conservative with an exploration and licensing policy, assumption of 60% recoverability for the on the lines of the New Exploration and Proved resources, about 64 billion tonnes Table 5-7. Status of CBM Licensing Policy (NELP), for shale oil and could be recovered. This could sustain Blocks gas in India once the initial studies are done a production level of over 1,800 million and deposits are established. tonnes per year for the next 30 years. Blocks Awarded 3 The DGH has formed a consortium with Up to December 2007, the Ministry of Under Round I 5 state-run Indian Oil Corporation (Indian Coal had allocated 172 Coal Blocks with Under Round II 8 Oil), Mineral Exploration Corporation reserves of coal of 38.05 billion tonnes Ltd. (MECL) and the French Institution to eligible companies. The private sector Under Round III 10 of Research in Earth Sciences, BRGM, was allocated 79 blocks with geological Total 26 to establish the potential of shale-oil reserves of 12,254 MT (Table 5-5). Area Awarded (sq km) 13,600 exploration in India. Private-sector participation in the coal Total CBM Resources (BCM) 1,374 sector is restricted to joint ventures and Planned coal projects companies that can use coal for captive CBM Wells drilled 210 purposes. If the production is greater Expected Production Potential At March 31, 2009, out of a total of than what is required for internal use, the (MMSCMD) 38 701 mining projects costing more than balance must be sold to Coal India Ltd. As $450,000, 411 projects stood completed Approved Gas Sale Price 6.79 of 31 March 2009, 201 coal blocks with ($/MMBTU) (including projects which are merged, reserves of 45.89 billion tonnes had been completed and merged, and where coal Source: India - Petroleum Exploration and allocated to eligible companies. Production Activities, 2007-08 reserves have since been exhausted) and Of the 201 blocks, 97 have been 160 projects were in various stages of 27 Coal India Ltd. (CIL) Headquartered at Kolkata (formerly Calcutta), CIL is the apex body in the coal industry and is responsible for laying down policy guidelines and coordinating work of its nine subsidiaries. The eight subsidiaries responsible for coal mining activity are: n Bharat Coking Coal Ltd., Dhanbad n Central Coalfields Ltd., Ranchi n Mahanadi Coalfields Ltd., Sambalpur n Western Coalfields Ltd., Nagpur n South Eastern Coalfields Ltd., Bilaspur n Northern Coalfields Ltd., Singrauli n Eastern Coalfields Ltd., Asansol n North Eastern Coalfields, Guwahati The ninth subsidiary, Central Mine Planning and Design Institute Ltd., Ranchi, supports the planning and design needs of new coal projects and is responsible for the reorganization of existing mines for optimal production of coal. CIL, on behalf of all its subsidiaries, is engaged in investment planning, manpower management, purchase of heavy machinery and financial budgeting. http://www.coalindia.in

Coal sector entities Neyveli Lignite Corpora- tion (NLC) NLC is engaged in the exploitation and excavation of lignite, generation of 2,490 MW of thermal power, and sale of raw lignite. It has the biggest open- cast mechanized lignite mines in India. It mined 21.58 million tonnes of lignite in 2007-08. NLC also provides consultancy in mine planning and renovation of power plants. http://www.nlcindia.co.in Singareni Collieries Com- pany Ltd. (SCCL) SCCL is a joint sector undertaking of the Government of Andhra Pradesh and the Government of India, with equity capital implementation. Out of 160 ongoing an increasingly large share of India’s in the ratio of 51:49. Headquartered at projects, 125 were on schedule and 35 energy. Associated ports, railways and Kothagudem in Andhra Pradesh, SCCL were delayed. Reasons include delay in transportation infrastructure will need to produced 41 million tonnes of coal in environmental and forestry clearances, be developed accordingly. In the current 2007-08. delay in acquisition of land and associated scenario (2009-10), 404 million tonnes http://scclmines.com problems of rehabilitation, adverse geo- of coal are required for the power sector. mining conditions and problems with The government-owned companies CIL law and order. Some areas of India have and SCCL are able to supply 343 mt power projects, their development has experienced extended periods of rebellion and the captive mines 20 mt. This still been slow, resulting in the coal shortage. or insurgency. leaves a shortfall of 41 mt and the power Among the obstacles to coal development If the power sector is required to companies have been advised to import have been coordinated development of grow at 10% per year, coal availability 28.7 mt of coal. This shortfall is expected the rail network and a lack of other models from domestic sources should also to persevere into the XII Plan. for coal exploration and mining, such grow at 10%, and possibly even faster, Though a number of coal blocks have as private-sector participation through a since projections show coal supplying been allocated by the Ministry of Coal for public-private partnership. 28 2011 India Energy Appendix 1: Idiosyncratic India

Numeric system person, on the other hand, would refer in metric units. A handful of industries, such to one crore rupees or INR 1 crore, not “a as construction and real estate, still use both This handbook presents numeric data and million rupees.” One billion rupees would the metric and Imperial systems, probably weights and measures in terms that are be “INR 1 arab.” because of their continued reliance on familiar to the Western tradition. But investors designs originating in the U.S. These will A word of warning is in order here. If reading Indian business and government probably complete their conversion to metric in Mumbai, India’s commercial capital, you documents will be plunged into a language when the U.S. does. that requires some explanation. are doing business with someone who uses khokha instead of crore and peti instead of Temperature is almost always in degrees The traditional Indian numeric system lakh, you’ve fallen in with bad company. Celsius and rainfall is measured in centimeters is still used in the subcontinent of India, These are slang terms used in the Mumbai and millimeters. However body temperature Bangladesh, Nepal and Pakistan (Table A-1). underworld’s parallel economy. is still sometimes measured in degrees It is based on a unique grouping of two Fahrenheit. decimal places instead of three as is common The Indian numeric system is very in the West. Thus, while Indians write 1,000 ingrained. Many expatriates in India recognize While body weight is always measured in for “one thousand,” their concession to the the need to speak in lakhs and crores. kilograms, body height is often measured in Western tradition ends there. Where a Although, as mentioned, there are many feet and inches, although many documents increasingly use centimeters. Westerner writes 100,000 and says “one other terms for higher numbers, in practice it hundred-thousand” for 105, Indian business is more common to repeat lakh and crore or Current status of Imperial units: English writes 1,00,000, and expresses it to combine them to designate those higher n Imperial units that are long forgotten: numbers. One lakh crore, for example, would Ounces, gallons, miles, pounds, pints, as “1 lakh” (or lac). The next step up in 12 the Indian numeric system is 107, written refer to 10 , or one trillion. However, with and quarts (only metric equivalents are 1,00,00,000 and expressed as “1 crore.” international companies now participating in used, and it is likely that people born after government tenders, by and large the U.S. 1980 might not even have heard of the “Crores,” “Lakhs,” and the practice of dollar is currency to be quoted. old measures) grouping decimal places by twos instead of threes in numbers larger than 1,000 Weights and measures n Imperial units used along with metric are widespread in Indian banking, stock India was one of the first countries in the equivalents: Inches, feet, yards (square exchanges, government data, journalism developing world to metricate its economy yards for area), degrees Fahrenheit (Both and business. The place value system is progressively. Metric weights have been metric and Imperial units are popular) derived from Sanskrit, India’s classical compulsory in trade since 1962, although n Imperial units more popular: Acres language, in which lakh, crore and a whole Imperial measures are still common in (hectares are generally used only in array of other terms serve as counterparts some other applications. Fuel efficiency government documents) to the West’s million, billion, trillion, etc. But is measured in kilometers per liter. Tire instead of naming groups of 103, Sanskrit, pressure is measured in kilograms per Indian abbreviations also may confuse and now Indian business English, names square centimeter (pounds per square the newcomer. “Cumec,” for example, groups of 102. inch only in some very old gauges) and is a unit of volume flow rate equal to tread sizes are in millimeters, while tire-rim 1 cubic meter per second, common Indians shift smoothly between their in the hydropower industry. We have diameters are still measured in inches, as is traditional numeric nomenclature and the included translations for some common common throughout the world. Western standard. They speak in dollars in abbreviations in the Acronyms pages, others banking, for example, and a professional While road distances are in kilometers, in the text. The reader is advised to ask an would never say “one lakh dollars.” He road widths are popularly measured in feet, Indian acquaintance when encountering would say “one hundred-thousand dollars,” but official documents use meters. Almost all unfamiliar terms. and would write $100,000. The same types of industry in India operate exclusively Neelam Mathews

Table A-1. India’s Unique Number System No. of Term Figure Zeroes In Words lakh (lac) 1,00,000 5 Hundred thousand crore 1,00,00,000 7 10 million arab 1,00,00,00,000 9 1 billion kharab 1,00,00,00,00,000 11 100 billion neel 1,00,00,00,00,00,000 13 10 trillion padam 1,00,00,00,00,00,00,000 15 1 quadrillion shank 1,00,00,00,00,00,00,00,000 17 100 quadrillion

29 Appendix 2: Acronyms AEC Atomic Energy Commission...... www.aec.gov.in MNRE Ministry of New and Renewable Energy...... mnre.gov.in AERB Atomic Energy Regulatory Board...... www.aerb.gov.in MoC Ministry of Coal...... coal.nic.in/welcome.html AHEC Alternate Hydro Energy Centre...... ahec.org.in MoP Ministry of Power...... powermin.nic.in AMD Atomic Minerals Directorate for MoPNG Ministry of Petroleum and Natural Gas...... petroleum.nic.in Exploration and Research...... www.amd.gov.in MPP Merchant power plant ATE Appellate Tribunal for Electricity MRPL Mangalore Refinery and Petrochemicals Ltd...... www.mrpl.co.in BARC Bhabha Atomic Research Centre...... www.barc.ernet.in MTPA Million tonnes per annum BBMB Bhakra Beas Management Board MW Megawatts ...... bbmb.gov.in/english/index.asp MWeq Megawatt Equivalent BCM Billion cubic meters NEEPCO North Eastern Electric Power Corporation Ltd. BEE Bureau of Energy Efficiency...... www.bee-india.nic.in ...... www.neepco.gov.in BHAVINI Bharatiya Nabhikiya Vidyut Nigam Ltd. NELP New Exploration Licensing Policy ...... www.bhavini.nic.in/main.asp NFC Nuclear Fuel Complex...... www.nfc.gov.in/default.htm BPCL Bharat Petroleum Corporation Ltd..www.bharatpetroleum.com NHDC Narmada Hydroelectric Development Corporation Ltd. BRNS Board of Research in Nuclear Sciences ...... www.nhdcindia.com ...... www.barc.ernet.in/webpages/brns/brns1.html NHPC National Hydroelectric Power Corporation Ltd. BRPL Bongaigaon Refinery and Petro Chemicals Ltd...... www.nhpcindia.com/index.aspx CBM Coal Bed Methane NLC Neyveli Lignite Corporation Ltd...... www.nlcindia.co.in CCO Office of the Coal Controller’s Organization NLDC National Load Despatch Centre...... www.nldc.in CEA Central Electricity Authority...... www.cea.nic.in NPCIL Nuclear Power Corporation of India Ltd...... www.npcil.nic.in CERC Central Electricity Regulatory Commission...... cercind.gov.in NPTI National Power Training Institute CESC CESC Ltd...... www.cescltd.com/cesc/menu.html# ...... www.powermin.nic.in/training/national_power_training.htm CHT Centre for High Technology...... www.cht.in NRL Numaligarh Refinery Ltd...... www.nrl.co.in CIL Coal India Ltd...... www.coalindia.in NTPC National Thermal Power Corporation Ltd. CMPDI Central Mine Planning & Design Institute Ltd...... www.cmpdi.co.in ...... https://www.ntpc.co.in CPCL Chennai Petroleum Corporation Ltd...... www.cpcl.co.in OIDB Oil Industry Development Board...... www.oidb.gov.in CPRI Central Power Research Institute...... www.cpri.in OIL Oil India Ltd...... www.oil-india.com CPSU Central Public Sector Undertaking OISD Oil Industry Safety Directorate CTU Central Transmission Utility ONGC Oil and Natural Gas Corporation Ltd. C-WET Centre for Wind Energy Technology...... www.cwet.tn.nic.in ...... www.ongcindia.com/english.asp DAE Department of Atomic Energy...... www.dae.gov.in/ OVL ONGC Videsh Ltd...... www.ongcvidesh.com DGH Directorate General of Hydrocarbons...... www.dghindia.org PCRA Petroleum Conservation Research Association...... www.pcra.org DISCOM Distribution company PFC Power Finance Corporation Ltd...... www.pfcindia.com DVC Damodar Valley Corporation..... www.dvcindia.org/index.htm POWERGRID Power Grid Corporation of India Ltd. E&P Exploration and production ...... www.powergridindia.com/PGCIL_NEW/home.aspx ECIL Electronics Corporation of India Ltd...... www.ecil.co.in PPAC Petroleum Planning & Analysis Cell...... www.ppac.org.in EIL Engineers India Ltd...... engineersindia.eil.co.in PSU Public Sector Undertaking EOL Essar Oil Ltd...... www.essar.com PTC PTC India Ltd...... www.ptcindia.com GAIL GAIL (India) Ltd...... www.gailonline.com/gailnewsite/index.html R-APDRP Restructured Accelerated Power Development and Reform Programme...... www.pfc.gov.in/apdrp/apdrp2.html GoI Government of India...... india.gov.in REC Rural Electrification Corporation Ltd...... recindia.nic.in GSI Geological Survey of India...... www.portal.gsi.gov.in REL Reliance Energy Ltd...... www.rinfra.com GSPC Gujarat State Petroleum Corporation Ltd...... www.gspcgroup.com/gspc.html RGGVY Rajiv Gandhi Grameen Vidyutikaran Yojana ...... rggvy.gov.in/rggvy/rggvyportal/index.html HPCL Hindustan Petroleum Corporation Ltd...... www.hindustanpetroleum.com/En/UI/Home.aspx RIL Reliance Industries Ltd...... www.ril.com HWB Heavy Water Board...... www.heavywaterboard.org RLDC Regional Load Despatch Center IEEMA Indian Electrical and Electronics Manufacturers Association RPPO Renewable Power Purchase Obligation ...... www.ieema.org SCCL Singareni Collieries Company Ltd...... scclmines.com IEX Indian Energy Exchange...... www.iexindia.com SEB State Electricity Board IGCAR Indira Gandhi Centre for Atomic Research...... www.igcar.ernet.in SEC Solar Energy Centre...... mnre.gov.in/sec/sec-objective.htm IGL Indraprastha Gas Ltd...... www.iglonline.net SERC State Electricity Regulatory Commission IOCL Indian Oil Corporation Ltd...... www.iocl.com/home.aspx SJVN SJVN...... sjvn.nic.in IREDA Indian Renewable Energy Development Agency Ltd. SLDC State Load Despatch Centre ...... www.ireda.in SSS-NIRE Sardar Swaran Singh National Institute of IREL Indian Rare Earths Ltd...... www.irel.gov.in Renewable Energy...... mnre.gov.in/nire-rdd.htm kW Kilowatts STU State Transmission Utility MECL Mineral Exploration Corporation Ltd...... www.mecl.gov.in TCF Trillion cubic feet MGL Mahanagar Gas Ltd...... www.mahanagargas.com TERI The Energy and Resources Institute...... teriin.org MMT Million tonnes THDC Tehri Hydro Development Corporation Ltd...... thdc.gov.in MMTOE (or MTOE) Million tonnes of oil equivalent TRANSCO Transmission company MNES Ministry of Non Conventional Energy Sources UMPP Ultra Mega Power Plant 30 Appendix 3: Energy reports and planning and policy links

Atomic Energy Regulatory Board...... www.aerb.gov.in/ Central Electricity Regulatory Commission...... cercind.gov.in/ Directorate General of Hydrocarbons...... www.dghindia.org/ EIA India Country Analysis Brief...... www.eia.doe.gov/cabs/India/pdf.pdf Electric Power Survey 17...... www.cea.nic.in/planning/17TH%20EPSR-Highlights.pdf The Electricity Act 2003...... www.cea.nic.in/home_page_links/ElectricityAct2003.pdf Expert Committee on Road Map for Coal Sector Reforms, Part I...... coal.nic.in/expertreport.pdf Expert Committee on Road Map for Coal Sector Reforms, Part II...... www.indiaenvironmentportal.org.in/files/expertreport2.pdf Integrated Energy Policy, Report of the Expert Committee, August 2006...... planningcommission.nic.in/reports/genrep/rep_intengy.pdf National Action Plan on Climate Change...... pmindia.nic.in/Pg01-52.pdf National Electricity Policy 2005...... www.cea.nic.in/planning/national_Electricity_policy.htm National Tariff Policy 2006...... www.powermin.nic.in/whats_new/pdf/Tariff_Policy.pdf Petroleum & Natural Gas Regulatory Board...... www.pngrb.gov.in/ Planning Commission of the Government of India...... planningcommission.nic.in/ Power Sector in India: White Paper on Implementation Challenges and Opportunities ...... www.kpmg.com/IN/en/IssuesAndInsights/ThoughtLeadership/PowerSector_2010.pdf Renewable Energy Certificate Regulation 2010...... cercind.gov.in/regulation/REC_2010.html Report of the Expert Committee on Integrated Energy Policy...... www.indiaenvironmentportal.org.in/files/energy.pdf Rural Electrification Policy 2006...... www.powermin.nic.in/whats_new/pdf/RE%20Policy.pdf USAID India Country Report ...... usaid.eco-asia.org/programs/cdcp/reports/Ideas-to-Action/From%20Ideas%20to%20Action_Complete%20Report.pdf World Energy Outlook 2007, IEA...... www.iea.org/textbase/nppdf/free/2007/weo_2007.pdf

31 IPG—Industrial Project Group Srl

Principal Activities

n Feasibility studies for large fossil-fired, waste-to-energy, and nuclear power plants

n Retrofit of existing subcritical coal-fired boilers to ultrasupercritical operation

n Independent-engineer services for banks and other financial institutions, private investors, and power plant owners worldwide

n Help determine R&D needs of plant owner/operators and developers

n Feasibility studies of advanced carbon capture and storage systems and advanced gasification processes

Please contact: Giorgio Dodero, chairman [email protected]