The Format for the Proposal of MRP – I

1. The Title page

2. A brief introduction to selected industry
3. Statement of the Problem
4. Scope of the study
5. Objectives of the Study
6. Significance of the Study
7. Research Methodology
8. Chapterisation scheme
9. Time planning
10.Budget
11.Bibliography (Source/s of data)
 A
MANAGMENT RESEARCH
REPORT
Of
“COMPREHENSIVE STUDY ON INDIAN
ELECTRIC POWER
INDUSTRY”

SUMMITED TO,

V.M.PATEL INSTITUTE OF MANAGEMENT

Ganpat University, Kherva.

SUMMITED BY,

Gurjar Sanjiv B.
Chondagar Ghanshyam R.
Mohmmad Tarik K.
Introduction of Indian Electric Power Industry
The electric power industry in India is both a supplier and
a consumer of primary energy, depending on the kind of energy
used to turn the generators. Hydroelectric and nuclear power plants
add to the country's supply of primary energy. The total installed
electricity capacity in public utilities in 1992 was 69,100
megawatts, of which 70 percent was thermal, 27 percent
hydropower, and 3 percent nuclear. The total installed capacity was
programmed to reach around 100,000 megawatts by FY 1996
through a package of government-supported incentives to the
private sector.

Because they cannot always depend on public utilities, many

larger industrial enterprises have developed their own power
generation systems. In 1992 there was a capacity of 9,000
megawatts outside the public utility system. Overall, the generation
and transmission of power in India--with an average 57 percent
plant load factor in FY 1992 in thermal plants and transmission
losses of 22 percent--were inefficient. About 322 billion kilowatt-
hours of power were generated by utilities in FY 1992,
approximately 8.5 percent shy of demand. The resulting deficit led
to acute shortages in some states. This trend continued the next
year when 315 billion kilowatt-hours were produced. Many factors
contributed to the shortfall of electric power in India, including
slow completion of new installations, low use of installed capacity
because of insufficient maintenance and coal, and poor
management. In FY 1990, industry accounted for 45 percent of
electricity consumed, agriculture 26 percent, and domestic use 16.5
percent. Other sectors, including commerce and railroads,
accounted for the remaining 12.5 percent.
 Rural electrification in India made great progress in the
1980s; more than 200,000 villages received electricity for the first
time. In 1990 around 84 percent of India's villages had access to
electricity. Most of the villages without electricity were in Bihar,
Orissa, Rajasthan, Uttar Pradesh, and West Bengal. Villagers
complain that government figures on electrification of villages are
artificially inflated. Actually, although lines have been run to most
villages, electricity is provided only sporadically (for example,
only nine to twelve hours per day), and villagers feel they cannot
depend on electricity to operate pumps and other equipment.
Electricity to cities also is sporadic; blackouts occur every day in
most cities.

India's first hydroelectric station was constructed in 1897 in

Darjeeling (then Darjeeling). In FY 1990, installed capacity for
hydroelectric power was 18,000 megawatts. The country has a
large economically exploitable hydroelectric potential, especially
in the foothills of the Himalayas, but no large increase in capacity
is predicted for the mid-1990s. Hydroelectric facilities have to be
coordinated with other sources of electricity because seasonal and
annual variations in rainfall affect the amount of water needed to
turn the generators and consequently the amount of electricity that
can be produced.

Hydroelectric power projects in India have not been without

controversy. Indian Dams for irrigation and power generation have
displaced people and raised the specter of ecological problems.
Power Generation

Electricity generation is the first process in the delivery of

electricity to consumers. The other processes are electric power
transmission and electricity distribution which are normally carried
out by the electrical power industry.
The growth of the industrial economy of India depends on
the rapid development of the badly lagging power generation
sector. Though India has abundant natural resources for
generation of both hydro and thermal power, infrastructural
shortcomings may bring the power industry to its knees

By the end of 1995, India's total installed power generation

capacity was 81,164 Megawatt. Of that, hydro-electricity (hydel)
accounts for almost 26 percent, but hydel accounts for less than 13
percent of the total electricity generated in the first three years of
the current eighth plan.

In the thermal power segment, the average plant load factor

(PLF) has improved in recent years, especially in the south and
west of the country. Thermal power generation appears to be the
most promising way for India to meet it's power requirements over
the next years. The previous government as well as the new United
Front government have several projects on hand to best serve this
requirement.

Among the projects on the anvil is a plan to privatize the fuel

supply system. In most proposed power projects, fuel leakage and
fuel risk responsibility have been among the main stumbling
blocks. The state as the fuel supplier is unwilling to sign any
guarantees and the private power companies are unwilling to risk
running out of the fuel.
 Another related area where this argument is extended is the
transport sector. The previous ministry of transportation was in the
view that the legally enforceable commercial agreement with
transporters of fuel like the railways should be made into a
mandatory clause.

Once the basic transport and resource utilization

(mining, petroleum refining) infrastructure starts developing apace
with the needs of the power generation industry, the thermal power
units will start to be functionally efficient, and the needs of Indian
industry will be better met.

Distribution Segment:

Indian Power Distribution is characterized by extremely high

technical and non-technical losses, resulting from obsolete and
inefficient distribution equipment, widespread power theft, illegal
connections and non-payment of bills. The direct financial cost of
preventable losses exceeds Rs. 25,000 Crores annually, and,
without remediation, is expected to double in five years. Current
losses are comparable with the annual investment requirements for
the power sector, are twice India's annual budget for health, and
about half its annual budget for education.

Accelerated Power Development and Reforms Program

(APDRP)

In power sector, the distribution system plays a vital role where,

the gap between the average revenue realization and the average
cost of supply has been constantly increasing since a decade. This
is causing the state electricity boards (SEB) run under huge losses.
In view of the losses faced by the SEB's, the Government of
India/MOP has undertaken the APDRP with the aim of restoring
the commercial viability in the distribution sector.
The main aim of the program is
 • To make the power sector financially viable
• To provide reliable, quality power supply at affordable cost to
consumers.
• Reduction in Transmission and Distribution losses (T&D) to
around 10%.
• Introduce IT initiatives in Power Distribution reducing
human intervention.
• Computerization for Management integrated system (MIS)
• Computerization for billing, etc.
• Customer satisfaction

Schemes planned under APDRP are renovation and

modernization of sub-stations, transmission lines & distribution
transformers, augmentation of feeders & transformers, feeder and
consumer meters, high voltage distribution system
(HVDS), consumer indexing, SCADA, computerized billing etc.

Power Companies in India

Many government as well as private organizations have taken up the task of power
generation in India. The major Indian power companies playing prime are:

 Bhakra Beas Management Board

 Enercon Systems India
 Essar Group
 GMR Group
 Gujarat State Petroleum Corporation Ltd
 Jindal Steel & Power Limited
 Karnataka Power Transmission Corporation Limited
(KPTCL)
 Karnataka Renewable Energy Development Limited
 Konarka
 Magnum Power Generation Limited
 Nippo Batteries
 Reliance Energy Ltd.
 Shri Shakti
  Durgapur Projects Limited
 Satluj Jal Vidyut Nigam Ltd.
 United Power
 Ventral Systems Pvt. Ltd.
 Enron India Power Plant
 Celetronix Power India
 Caterpillar Power India
 Alton Power India
 Thorium Power India
 GE Power Controls India
 Green Power India

Indian Power Industry Profile

GROWTH OF INDIAN POWER SECTOR:

Generating capacity has grown manifold from 1712 MW in

1950 to 110000 MW today. Transmission lines have grown from
2708 ckm to 200000 ckm.

STRENGTHS OF INDIAN POWER SECTOR:

Well established and rapidly growing transmission and

distribution network, private investment possible in all the
segments, highly qualified and trained Engineering, IT and Finance
professionals and Independent Judiciary with well established legal
system.

COMMERCIAL LOSSES IN STATE UTITLITIES:

Commercial losses have increased from Rs. 4,200 Crores in

1992 to about Rs. 27,500 Crores in 2003. Among the factors
responsible, the majors are Unmetered Supply, No Comprehensive
Energy Auditing / Accounting, Theft and Pilferage, Cross subsidy
in favor of Agriculture and domestic sectors.

REFORMS - OBJECTIVES:

To bring in commercial viability in Power supply industry; to

provide reliable power supply at affordable costs to all the
consumers; Complete Rural Electrification power to all including
remotest areas; use of Information Technology to reduce human
intervention wherever possible; competition in all fields of power
sector viz., Generation, Transmission and Distribution.

STRATEGY FOR REFORMS:

 Constitution of Central and State Electricity Regulatory
Commissions, Full Audit of Energy Flow, 100 % Metering,
Eradication of theft, Rationalization of tariffs, Corporatization of
Distributions.

REFORMS THRUST - DISTRIBUTION:

Reduction of T&D losses, rationalization of Tariffs;

Improvement of efficiency in Metering, Billing and collections to
help generate internal resources. Proper Demand Side Management
to reduce the requirement of capacity additions.

Accelerated Power Development and Reforms Program:

APDRP is aimed at the objectives discussed above. The total

allocated budget under this scheme was Rs. 40,000 crores
including the Reforms component and the component for writing
off the losses in the previous regime. The total funds utilized as on
1st January 2005 were Rs. 9,000 crores approximately. Several
states have not picked up the essentials of this program and the
funds are lying unutilized.

Statement of the Problem

 We have the statement of the problem is finding the data
about the electric power industry of whole India regarding to
Power generation & distribution. Therefore, we will collect the
data about this & analysis of them too which gives findings &
suggestion to the industry. Also, we compare this data with other
country through which we become able to understand the global
growth with respect to the other country.

Objective of the Study

• The report provides research and objective analysis of Indian

Power Industry.

• This report helps clients to analyze the opportunities critical

to the success of power sector in India. Government support,
economic growth, market reforms etc remain the major
market forces for the Indian power industry.

• With this data we become able to understand whole Indian

Electric Power Industry & also its generation & distribution
strategies with respect to other country.

Scope of the Study

• Indian power sector is plagued by high T&D losses, which is

one of the main issues for the deteriorating state of SEBs.

• This sector has been through number of reforms in the past

10 years, which have not been very successful. In fact, there
have been disasters such as Enron and Orrisa’s attempt at
reforms. Hence, it will be interesting to observe the impact of
 the current reform initiatives namely, the APDRP, The
Electricity Act, 2003.

• The generating capacity has grown manifolds from

1,362MW in 1947 to more than 112,058MW. However, India
still has a huge demand supply gap.

• The impact on reforms in light of the change in the political

scenario.

• High Transmission and Distribution Losses, Small Capital

Outlay by Indian Distribution Equipment Players &
Regulatory Complications are major obstacles before Indian
power sector.

This will become the scope of our study. In our research

report we will include it & also compare them with other
country for global sustenance.

Significance of The Study

With the help of the study, we become able to know

following elements:

• Market forces driving the industry & challenges faced by it.

• Major players in Indian Electric Power Industry.
• What opportunities exist in Indian power industry?
• Detailed overview of Indian power sector at state level.
Research Methodology

The data presented in this report are derived from a

comprehensive study of the Indian domestic or external power
distribution market.

The primary and secondary research included all possible

major application areas for both external & domestic power
supplies. The data-gathering methodology included Secondary
research was performed using all available published sources
including, but not limited to, nonproprietary, previously performed
and related work by the other Group, all available trade journals,
proceedings from related trade conferences, previous industry
studies, annual reports, 10Ks, advertising, product literature, and
soon.

Chapterisation Scheme

In it, we include the brief structure of our research study covering

the overall aspects.

Chep. - 1 Introduction
- Intro. About the Project
- Intro. About the Indian Electric Power Industry.

Chep. - 2 Indian Electric Power Industry Profile

Chep. - 3 Major players in Industry

Chep. - 4 Statement of the Problem

Chep. - 5 Objectives & Scopes of the Study

Chep. - 6 Significance of the Study

Chep. - 7 Research Methodologies

Chep. - 8 Swot Analysis

- Strength & weakness (Comparison of two Country)
- OT Analysis ( Within one Industry)

Chep. - 9 PEST Analysis (Political, Economic, Social,&

Technological)

Chep. -10 Strategic Analysis (Last years)

Chep. - 11 Financial Analysis (Growth, Sales, & Exports)

Chep. - 12 Major players in Industry (Top of the Industry)

Chep. - 13 Conclusion

Chep. - 14 Suggestions

Chep. - 14 Bibliography