Vol-3 Issue-1 2017 IJARIIE-ISSN(O)-2395-4396 INDIAN POWER SECTOR AND CONTRIBUTION OF MAHARASHTRA Kale M. L1., Mate A. K., Narwade V. B., Vharkate C. B., Rathod N.R. Kale M.L., Lecturer, Mechanical Engg. Department, M.S.Poly, Beed, MH, India Mate A. K., Lecturer, Mechanical Engg. Department, M.S.Poly, Beed, MH, India Narwade V. B., Lecturer, Mechanical Engg. Department, M.S.Poly, Beed, MH, India Vharkate C. B., Lecturer, Mechanical Engg. Department, M.S.Poly, Beed, MH, India Rathod N. R., Lecturer, Mechanical Engg. Department, M.S.Poly, Beed, MH, India ABSTRACT Power Sector in India has grown significantly from independence both in the installed electricity generating capacity and transmission & distribution (T&D) system. The total power generating capacity of (utilities & non utilities) has increased from meager 1362 MW in 1947 to 267 GW at the end of March, 2015. The per capita electricity consumption which was mere 16.3 kWh in1947 has increased to 1010 KW h in 2014-15. With a production of 1,031 TWh. India is the third largest producer and fourth largest consumer of electricity in the world. It has fifth largest installed capacity in the world. Maharashtra plays very vital role in the evolution of the Indian power sector. As of 2012, Maharashtra was the largest power generating state in India, with installed electricity generation capacity with 26,838 MW. The state forms a major constituent of the western grid of India, which now comes under the North, East, West and North Eastern (NEWNE) grids of India. Maharashtra Power Generation Company controls and runs thermal power plants. In addition to the state government-owned power generation plants, there are privately owned power generation plants that supply power through the Maharashtra State Electricity Transmission Company, which is responsible for transmission of electricity in the state. Keyword: - Power sector in India, MAHAGENCO and Electricity transmission in Maharashtra. 1. INTRODUCTION With a production of 1,031 TWh, India is the third largest producer and fourth largest consumer of electricity in the world. It has 5th largest installed capacity in the world. Government initiated so much expansion plans. The government targets capacity addition of 88.5 GW under the 12th Five-Year Plan and around 100 GW under the 13th Five-Year Plan (2017–22). Investments of around USD250 billion are planned for the power sector during the 12th Five-Year Plan. The installed capacity reached 36.5 GW as on October 2015.Wind energy is estimated to contribute 60 GW, followed by solar power at 100 GW by 2022. The target for renewable energy has been increased to 175 GW by 2022. 100 per cent FDI is allowed under the automatic route in the power segment and renewable energy. Maharashtra state contributes around 13.91% in this journey of evolution of power sector in India. 3796 www.ijariie.com 1016 Vol-3 Issue-1 2017 IJARIIE-ISSN(O)-2395-4396 2. EVOLUTION OF THE INDIAN POWER SECTOR 3796 www.ijariie.com 1017 Vol-3 Issue-1 2017 IJARIIE-ISSN(O)-2395-4396 3. GROWTH DRIVERS 3.1 POLICY SUPPORT AIDING GROWTH IN THE SECTOR Electricity Act, 2003: Elimination of licensing for electricity generation projects, Increased competition through international competitive bidding. National Tariff Policy, 2006: Adequate return on investment to companies engaged in power generation, transmission and distribution, clear guidelines to SERCs for fixing tariffs, Supply of electricity to consumers at reasonable and competitive rates. Ultra Mega Power Projects (UMPPs): Launch of the UMPP scheme through tariff-based competitive bidding, Easy availability of land possession, provision of fuel, water and necessary clearances for enhancing investor confidence, According to Union Budget 2015 to 2016, five new UMPPs ,each of 4000MW, have been proposed to setup in the plug & play mode R-APDRP: R-APDRP was launched by Ministry of Power with the purpose of reducing AT&T losses up to 15% by up gradation of transmission and distribution network, Joining disbursement of central government funds (to states), with actual reduction in transmission and distribution losses. Sanctioned projects of more than 5.8 US billion Dollar. Fuel Supply Agreement: Fuel supply agreement with Coal India Ltd will ensure the availability of coal for power companies over the long term National Electricity Policy: Supply electricity to all areas, Prepared in consultation with state governments, CEA, and other stakeholders, Supply of reliable and quality power in an efficient manner and reasonable rates Feed in Tariff: This policy used for promoting generation of electricity from renewable energy sources, Allows Power Producers to sell renewable energy generated electricity to an off – taker at a pre-determined tariff for a given period of time 3.2 STRONG DEMAND AND POLICY SUPPORT DRIVING INVESTMENTS Multiple drivers are leading to growth in power demand; this is set to continue in the future. During FY10 to FY 15, GDP growth is likely to average 8.0–8.5 percent. India is set to become a global manufacturing hub with investments through the value chain India’s power demand is expected to rise up to 1,905 TWh by FY22 3.3 POLICIES ADOPTED DURING BUDGET FY15 & FY16 Generation-based incentives: Government to reintroduce 'generation-based incentives' for wind power projects to increase capacity addition in the sector; Cutting of excise duties by 2 % on capital goods import. USD147.3 million would be allocated to the Ministry of New and Renewable Energy. Public Private Partnership: To reduce dependency on imported coal, a Public Private Partnership (PPP) policy framework FDI policy: 100 % FDI is allowed under automatic route for power sector except atomic energy. During FY13, the Government adopted FDI policy for Power Trading Exchanges. Foreign Investment in power exchanges registered under the CERC Regulations, 2010, allowed up to 49 per cent (FDI-26 % and FII-23%) Low-interest funds: Low-interest–bearing funds to be provided from National Clean Energy Fund (NCEF) to Indian Renewable Energy Development Agency Ltd (IREDA) for on-lending to various renewable energy projects Growing investments: The total plan outlay for the power sector for FY16 is estimated at US Dollar 10.05 billion. While the proportion of plan expenditure in the total outlay was 59% in FY13 and for FY14 is a whopping 96 %. Tax benefits: Benefit under section 35 (2AA) of the Income Tax Act to industry or private sponsored research programmers. Write – off can be availed for expenditure to be made on R&D to in-house R&D centres. Further incentives are available for setting up of projects in notified areas 3.4 POLICIES ADOPTED DURING BUDGET FY15 & FY16 Power is one of the key sectors attracting FDI inflows into India. FDI inflows into the sector increased from USD4627 million in FY07 to USD9967 million in FY16 during September’15. Power accounted for 4 per cent of 3796 www.ijariie.com 1018 Vol-3 Issue-1 2017 IJARIIE-ISSN(O)-2395-4396 total inflows till September 2015. Cumulative FDI inflows into the sector in April’00– September’15 were USD9.9 billion. 100 per cent FDI allowed in the power sector has boosted FDI inflows in this sector. Private equity investments in the sector have surged since 2010.Asian Development Bank. Goldman Sachs and Global Environmental Fund have together invested USD140 million in ReNew Wind Power Pvt Ltd on July 03, 2014. EIG Global Energy Partners made an investment of 125 million US Dollar in Greenko Group, which is planning to develop its wind farms and hydropower assets in India by means of Greenfield projects and acquisitions. GE Energy Financial Services plans to invest US Dollar 24 million in a solar power project by Welspun Renewables Energy Pvt. Ltd. 4. MAJOR PLAYERS IN THE POWER SECTOR FOR INDIA 4.1 NTPC NTPC is India’s largest power producer and the sixth-largest thermal power producer in the world, with installed capacity of 45.05 GW (including JVs). By 2032, National Thermal Power Corporation plans to reach 128,000 MW of power capacity. Coal-based power accounts for more than 84.7 per cent of the total capacity. It has also distributed into hydro power, coal mining, power equipment manufacturing, oil and gas exploration, power trading and distribution. 4.2 Tata Power Tata Power is India’s largest integrated power company, with significant presence in solar, hydraulic, wind and geothermal energy space. The company accounts for 52% of total generation capacity in the private sector, with an installed capacity of 8.7 Giga Watt. By 2022, the company plans to increase the generating capacity to 18 GigaWatt, distribution networks by 4 Giga Watt and energy resources by 25 million tons per annum. 4.3 Reliance Power NTPC is India’s largest power producer and the 6th largest thermal power producer in the world, with installed capacity of 45.05 GW (including JVs). By 2032, NTPC plans to reach 128,000 Mega Watt of power capacity. Coal-based power accounts for more than 84.7% of the total capacity. It has also diversified into hydro power, coal mining, power equipment manufacturing, oil and gas exploration, power trading and distribution. 4.4 CESC Ltd. CESC Limited is a vertically integrated player engaged in coal mining, and generation and distribution of power. It owns and operates three thermal power plants producing 1225 Mega Watt of power. These are Budge Generating Station (750 MW), Southern Generating Station (135 MW), and Titagarh Generating Station (240 MW) 4.5 NHPC NHPC is the largest hydro power utility in India, with an installed capacity of 6.5 Giga Watt; it has drawn up a massive capacity expansion plan of adding 6.7 Giga Watt by 2017.