13th Dec' 2004

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PRESENTATION TO STANDING COMMITTEE ON ENERGY
ON IMPLEMENTATION OF APDRP

13th Dec. 2004
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WELCOME
MEMBERS STANDING COMMITTEE ON ENERGY
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Power Development in India
112058 MW
Capacity MW
1712 MW
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Ratio
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THE PROBLEMS

• Skewed tariff structure leading to unsustainable
  cross subsidy.
• losses per annum 33,000 Crore i.e 1.5 GDP may
  increase to 1,00,000 Crore per annum if proper
  steps are not taken
• Huge TD losses, largely due to outright theft
  and unmetered supply (around 20,000 Cr. annually)
• Gap between cost of supply and average tariff is
  high
• High LT/HT line ratio
• Overloaded DT/Lines
• Poor quality/unreliable power
• Lack of accountability in distribution setup of
  SEBs
• Unaccountability at feeder level

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THE PROBLEMS

• Old and poor distribution network leading to
  frequent outages and poor quality / unreliable
  power
• Poor return to utilities affecting their
  viability and capability to invest
• Lack of private investment in power distribution
  sector
• Poor billing 51 power generated billed and 41
  realized
• Difference between Average Cost of Supply
  Average Revenue Realization is around 110 paisa
  / unit

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DISTRIBUTION REFORMS

• Distribution Reforms aimed at
• System up gradation of Sub transmission and
  distribution
• Loss reduction (Technical Commercial)
• Theft control through increased vigilance
  Legislation
• Consumer satisfaction
• Approach
• Profit centre approach
• Decentralized generation in rural areas
• Focus on Concentrated Zones
• IT initiatives to replace human intervention

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DISTRIBUTION REFORMS (contd..)

• Parameters to be monitored
• Revenue realisation v/s Energy input
• Reliability Index
• ATC loss
• Productivity (Energy handled per employee)

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APDRP

• With a focus on distribution reforms Govt. of
  India approved APDRP Scheme
• The following initiatives have been undertaken
  for bringing about commercial viability of
  SEB/Utility
• Administrative Intervention
• 11kV feeder as Profit Centre
• SE designated as CEO
• JE designated as feeder manager
• Technical Intervention
• 100 metering (tamper proof)
• Installation of capacitor at all levels
• Computerization of billing
• Re-configuration of feeder lines DTs
• Commercial Intervention
• Energy meters on DTs Consumers and energy
  accounting
• Energy Audit and Accounting at all levels
• Energy meters on feeders

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• APDRP
• Accelerated Power Development and Reform
  Programme as a Six level Intervention Strategy
  for distribution reforms to
• Reduce ATC losses
• Bring about commercial viability in the power
  sector
• Reduce outages interruptions
• Increase consumer satisfaction
• TIME FRAME 4 YEARS (TENTH PLAN PERIOD)
• Expected outlay of Rs. 40,000 Crore as additional
  central plan assistance to State Governments
  during Tenth five year plan.
• Rs. 20,000 Crore for strengthening up gradation
  of sub-transmission and distribution networks
  under INVESTMENT COMPONENT.
• Rs. 20,000 Crore grant to the states for
  reduction in the cash loss by the SEBs/Utilities
  under INCENTIVE COMPONENT.
• Initially the focus is on high-density networks
  i.e. urban centers where investment could lead to
  substantial, quick demonstrable results.

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INVESTMENT COMPONENT

• Projects for strengthening and up gradation of
  STD network are sanctioned for reduction in
  losses outages and better reliability
  increased customer satisfaction
• Projects sanctioned Rs. 14710.74 Cr.(02-03)
• Rs. 1899.43 Cr. (03-04)
• Rs. 1008.92 Cr.(04-05)
• Total Rs. 17619.09 Cr.
• Funds released Rs.1755.51 Cr.(02-03)
• Rs. 2356.51 (03-04)
• Rs. 4112.01 Cr. Total
• C/Part funds tied up Rs. 6233.92 Cr.
• C/Part funds drawn Rs. 2044.99 Cr.
• Funds Utilised Rs. 4762.18 Cr.

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ELIGIBILITY FOR AVAILING APDRP FUND

• States to sign MOU Achieved by all
• States to sign MOA Achieved by all
• States to sign TPA Achieved by all
• States not to default in payment of CPSUs dues

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ELIGIBILITY FOR AVAILING APDRP FUND (PRIVATE
AGENCIES)

• To Sign MOA with state Govt.
• State should agree before sanction of project and
  for recovery of loan
• Private agencies to inform assistance under APDRP
  including grants-in-aid along with quantifiable
  benefits expected from such investments to the
  SERC to ensure additional benefits are passed on
  to the consumers over and above what DISCOMs are
  obliged to, under extant agreements/order of the
  regulator. Private agencies are not eligible for
  incentive as incentive is built in their taking
  over agreements with State Govt.
• State Govt. to monitor progress of work and
  conditionalities committed under MOA.

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INVESTMENT COMPONENT DISBURSEMENT (Figures
Rs. in Crore)
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INVESTMENT COMPONENT DISBURSEMENT
(Figures Rs. in Crore)
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INVESTMENT COMPONENT DISBURSEMENT TO PRIVATE
COMPANIES

• All DISCOMs are private.
• N.B. Not eligible for Incentive Component

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INCENTIVE

• This component has been introduced to motivate
  the SEBs/Utilities to reduce their financial
  losses. Funds are provided to SEBs/utilities for
  actual cash loss reduction by way of one for two
  matching grants. FY 2000-01 has been fixed as
  base year
• M/S CARE appointed to review the incentive claims
  
• Incentive and amount released
  (Rs. in Crore)
• State Released Released Released
  (02-03) (03-04) (04-05)
• Andhra Pradesh 265.105
• Gujarat 236.37 Haryana 5.01
  100.48
• Maharashtra 137.89
• Rajasthan 137.71
• West Bengal 73.00
• Total 379.27 503.30 73.00
• Total Rs.955.58 Cr.
• Incentive claims for year 2002-03 of Assam,
  Gujarat, Karnataka, Kerala, Goa, Maharashtra and
  M.P. are under scrutiny

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STATUS

• METERING
• 100 feeder metering completed in 15 states and 2
  states have achieved more than 90 metering.
  (Overall 95 against 81.32 during 2001)
• 100 consumer metering completed in 4 states and
  9 states have achieved more than 90 metering.
  (Overall 87 against 77.6 during 2001)

Contd..
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States have reported reduction in Financial
Losses as shown below.
(Rs. In Crore)
Source SEB Accounts
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FINANCIAL LOSSES OF SEBs (Without SUBSIDY)
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States have reported reduction in ATC Losses as
shown below.
(In Percentage)
Source CARE
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Source CARE
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States have reported reduction in Revenue Gap
(ACS-ARR) as shown below.
(Fig in Rs./Unit)
Source CARE
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Source CARE
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STATUS

• Energy accounting started
• Consumer indexing started in A.P, Delhi, Gujarat,
  Karnataka, M.P., Maharashtra, Punjab, Rajasthan
  U.P.
• Feeder managers identified by states for
  increased accountability, which is helping in
  reduction of ATC losses
• Computerised billing and consumer care centres in
  selected towns of A.P., Delhi, Gujarat, H.P.,
  Karnataka, Maharashtra, M.P. Tamilnadu, U.P.
  West Bengal
• Andhra Pradesh, Delhi, West Bengal, Noida power
  Company have introduced High Voltage Distribution
  System for arresting power pilferage
• Assam, Andhra, Gujarat, Karnataka, Nagaland
  Orissa have started handing over parts of
  distribution networks to franchises

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Thanks