Apr 1 2013 | Power Zone

Growth of Indian economy and its global competitiveness...

"Growth of Indian economy and its global competitiveness hinges on availability of reliable and quality power at competitive rates. Being world’s 5th largest power consumer, demand for power in India is huge and also growing. While coal will be the dominant fuel in the years to come and with a massive coal shortage witnessed in the country, the only way to ensure an energy efficient future is to support the growth of power generation through renewable sources."

Hemant Kanoria, Chairman, DPSC Ltd shares his views with Sandeep Sharma about his company, T&D network, managing T&D losses, upcoming and ongoing projects, power tariff, environmental safeguards, use of I.T. & process automation, shortage of coal, renewable energy and his recommendations to solve power shortage in India. Edited Excerpts...

Tell us about your company, mission and objectives?
DPSC Ltd (formerly known as Dishergarh Power Supply Company Ltd), one of the oldest power utility companies in India, was incorporated in the year 1919 in the state of West Bengal. The company was set up primarily to supply power to the Bengal Coal Company Ltd., then the largest producer of coal in Asia and to serve the domestic and industrial needs in Asansol-Ranigunj belt in West Bengal. DPSC supplies power to critical industries like collieries, underground mines, State Electricity Boards, Railways, and Hospitals and so on.

An Andrew Yule company, DPSC went for disinvestment in the year 2009-10 & was taken over by India Power Corporation Ltd (IPCL), which is into renewable energy generation. The Group has ever since supported the process of rapid industrialization of the State of West Bengal. The company has an operating capacity of 12 MW of thermal generation in Bengal and 100 MW of Wind Power in Gujarat, Karnataka and Rajasthan. DPSC is pervaded by a unique culture comprising the 3 D’s – Discipline, Dedication and Devotion. With over nine decades of operation, we further want to be a leading and reliable end-to-end energy solution provider in the country, offering the lowest cost with highest reliability.

How do you manage to keep T&D loss at bare 3% against National average of 25%? How do you plan to strengthen transmission and distribution network in West Bengal?
DPSC, through its efficient power distribution, has maintained one of the lowest T&D loss figure across India. Through our better control systems and regular quality checks we ensure a minimum loss.Also, by an extensive augmentation of our existing systems by building new infrastructure, we have been able to keep a consistent check on energy losses through our networks. Committed to our delivery, we have initiated the Smart Grid development process since 2011. As a 1st phase of the Smart Grid project, we have successfully implemented Automated Meter Reading project (also known as AMR to Billing). The Company is now generating consumer meter reading reports and bills, real time with negligible variance in data. This has resulted in savings towards lead time for meter reading and bill generation and also increased the operational efficiency by increasing the accuracy of data. Pursuant to the success of AMR to Billing, we are now implementing the 2nd phase of the AMR project that will ensure real time data management and availability at the receiving feeders that will enable T&D Loss Management, further adding to its operational efficiency.

To strengthen its Distribution Network in West Bengal, the Company is developing a 220/33 KV substation at JK Nagar in Burdwan district. The associated transmission network will be connected with the State & National Grid. The Transmission Network along with sub distribution system will be capable to deliver around 250 MVA of power from grid and additional power from other sources after completion of the entire project that is scheduled by 2013-14. The project is a landmark project for DPSC as it marks its entry into the 220 kV Double Circuit transmission line. Post expansion, there will be enhanced connectivity with Central Transmission Utilities (CTUs) and the T&D losses could further be reduced to 2% or below.

Could you provide us some insight about your other upcoming and ongoing projects?
DPSC has undertaken its integration process by the amalgamation of IPCL into DPSC with a share swap ratio of 11:100. Every shareholder of IPCL holding 100 shares shall be entitled to receive 11 shares of DPSC. In the distribution sector, the Group is looking to expand its presence to other regions from the current 618 sq. km. license area in the Ranigunj-Asansol region. In the last two years the connected load has increased from 100 MVA to 250 MVA and the company is targeting a connected load of 1000 MVA by 2016. Going forward, the company plans to set up 400KV and 220KV substations for the required connectivity with the state and national grid. In the generation sector, IPCL-DPSC combine has envisioned a substantial increase in capacity to around 1300 MW by 2016, 300 MW from renewable sources and another 1000 MW through thermal power. The company’s 450 MW plant at Haldia is already under implementation and is expected to start in early 2015. It’s 540 MW thermal power plant at Raghunathpur is also under development and is looking at a commissioning date of 2016. The Company has also executed MoUs with State Governments for setting up Generation plants of 1320 MW in Bihar and Gujarat each and another 660 MW in Madhya Pradesh. The Company is achieving statutory approvals for the same and land identification is in process.

Could you comment on the competitiveness of the power tariff charged in your command area? Do you expect any increase in the near term?
Our command area is a multi-licensed one and as per the new tariff order published by the WBERC for 2012-13, average tariff for consumers is lower than that of other utility viz. WBSEDCL. Presently, DVC is supplying power to its consumers at the provisional tariff rate. From that point of view, our tariff is quite competitive.

Moreover, tariff is totally based on coal cost. So, increase in tariff in the near future depends on the Govt.’s policy on coal sector. To keep distribution sector healthy, coal cost should be passed on to the consumers through tariff rate. From that point of view, it is expected that tariff will be increased in the near future.

What kind of environmental safeguards are in place at your power stations?
As per Thermal Power Station safety norms, we have taken a lot of steps such as ESP, Effluent Treatment Plant, Proper Ash Disposal System etc. In stack we have also installed on-line Nox, Sox & CO2 monitor to keep stack emission within permissible limit. Our plant is a zero discharge plant surrounded by green belts.

Whether you are making use of I.T. & process automation in managing your operations? If yes, what are the benefits derived?
We have implemented AMR 1 (Automated Meter Reading) Project, which takes care of our consumer billing so far. Apart from this, we are also using SAP in our business process. So, consumer billing, data base maintenance, data analysis etc. are done through SAP. By using AMR1 System we have considerably reduced AT&C losses from the previous year. We will soon be implementing AMR2 Project to minimize the individual feeder loss to the extent possible. We are also planning to introduce SMART GRID System in our command area in the near future.

Industry players have reported shortage of coal for power generation. Are you also facing similar shortage of coal? What’s your recommendation to solve this issue plaguing the industry?
India’s power sector consumes about 80% of the coal produced in the country. With uncertainty over supplies from the largest coal producer, the industry has been plagued with a massive shortage in supply. And the fuel shortage risk is leading to high fuel cost as utilities have no option but to import fuel at high spot prices and at a significant premium to domestic coal. In domestic market too getting coal linkages is a major hurdle. Fuel crisis has had a telling effect on power generation as India suffered generation loss of nearly 11% in 2011-12. We, however, expect Coal India to increase their production and make international agreements shortly to increase maximum supply by 2014-15. Though the Planning Commission has also suggested some bold measures like opening up the coal sector for private players to tackle the growing fuel shortage and appointing a regulator to supervise pricing & mining costs, the suggestions have not yet been acted upon. Since power is a long term focus area for our Group, coal becomes very important. Accordingly we have accorded a very high priority to the task of developing sound capabilities in this area and we have created a Separate Business Vehicle itself which will focus on coal procurement both from domestic and international sources.

Going forward, what are your immediate and long term plans for expansion in the Renewable Energy sphere?
With around 100 MW of installed generation capacity at present, that includes 2 MW of solar energy and the rest coming from wind power, we want to further venture in the lucrative non-conventional segment. We plan to enhance capacity by around 100 MW each year in wind power through Greenfield expansions. The company also plans to enter hydro power generation mainly by brownfield expansion in India and overseas markets.

What’s your recommendation for solving the growing power shortage in India?
Growth of Indian economy and its global competitiveness hinges on availability of reliable and quality power at competitive rates. Being world’s 5th largest power consumer, demand for power in India is huge and also growing. While coal will be the dominant fuel in the years to come and with a massive coal shortage witnessed in the country, the only way to ensure an energy efficient future is to support the growth of power generation through renewable sources now so that our dependence on conventional source of energy reduces going forward and by the time finite resources are exhausted, we are ready to meet our complete energy requirement by renewable sources. Renewable energy will soon reach grid parity and largely cut down the operational expenditure, thereby addressing the problems due to power crisis.

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