Did you know India is the world's largest Power producer as well as a consumer with annual production (utilities and non-utilities) of 1,598 TWh and consumption of 1,383 TWh? If no then hang on we have brought a brief analysis of India’s power sector for you!
Sources of power generation range from conventional sources such as coal, lignite, natural gas, oil, hydro and nuclear power to non-conventional sources such as wind, solar, etc
India’s Power sector is divided into 3 sub-divisions 1) Generation 2) Transmission 3) DISCOM. Let discuss them one by one
1)Generation
India Currently produces 90.39 GW of power through renewable sources with wind and solar producing 2/3 of it. By 2030, India targets to achieve 450 GW of power through renewable sources.
In India, there are multiple fuel types of thermal power plants such as coal, gas, diesel, biogas & waste material and coal-based production produces 86% of the total thermal power. A total of 59,810 MW capacity of the thermal plant are under construction.
2) Transmission
The natural resources for generation are unevenly dispersed and concentrated in a few pockets. Transmission plays an important role in the power delivery value chain. It evacuates power from generating stations and delivers it to the load centers.
POWERGRID is engaged in power transmission business with the responsibility for planning, implementation, operation, and maintenance of inter-State transmission system and operation of National & Regional Power Grids
India has a total of 498,651 circuit-km of transmission lines, has the largest transmission network, accounting for 93 percent of the total transmission network in the south Asian region
3) DISCOM
India is the 3rd largest consumer and DISCOM (Distribution Company) acts as an important link in the entire power sector value chain, it acts as a bridge between the power producer and end consumers.
Under the “Power for All” scheme, the GoI focused on 24*7 electrification to all electricity-consuming entities. In FY19, India achieved the milestone of 100% electrification in all areas, which marked electricity to every village in India
DISCOM is the bottleneck of the power sector with dues rising nearly by 24% YoY to INR 1,36,966 Ce un Dec 2020. This is due to the shortfall in cash collection, delay in payment from end consumers, and the difference between purchase and sale price.
The government tried privatizing DISCOM companies but was only successful in a few major cities like Delhi, Mumbai, Ahmedabad, Surat, and Agra.
GoI launched the UDAY scheme in 2015. It was designed to turn around the precarious financial position of DISCOM. AT&C (Aggregate Technical & Commercial) losses form a major part of total outstanding dues of DISCOMs payable to generators/creditors
In budget 2021-22, the government has planned to spend INR 3.05 Lakh Cr on the electricity distribution reform program over the next five years. This will help the power sector to reform and be more efficient in the long term.