The Indian power sector saw significant changes in the past one year, led by the power majors. Gencos added significant capacity in the past year, taking the country’s total thermal additions to 4,485 MW in 2021-22, hydropower additions to 393 MW and renewable additions to 14,229 MW in 2021-22. The country’s largest power generator, NTPC Limited added the maximum thermal capacity during this period.
On the transmission side, public sector major Power Grid Corporation of India Limited (Powergrid) continued to be the leading player in terms of line length additions. It was followed by the state power transcos Transmission Corporation of Telangana Limited, Tamil Nadu Transmission Corporation Limited and Uttar Pradesh Power Transmission Company Limited.
Meanwhile, discoms have been witnesing poor financial and operational performance for a while now, which has been attributed to high aggregate technical and commercial (AT&C) losses and mounting discom debt. Under the new reforms-based, results-linked Revamped Distribution Sector Scheme (RDSS), which has an outlay of over Rs 3 trillion, several state-owned discoms came on board.
Indian Infrastructure gives an overview of the top performers in terms of capacity addition in the sector during the past one year…
Generation
The thermal generation segment saw a total capacity addition of 4,485 MW in 2021-22 as against 4,926 MW in 2020-21, and a target of 10,285 MW. Of this, the central sector led by NTPC added 2,370 MW, while the state sector added 1,590 MW and the rest was contributed by the private sector (525 MW).
Thermal-based projects commissioned by NTPC were the Darlipalli thermal power plant (TPP) in Odisha (Unit 2, 800 MW) and the Barh TPP in Madhya Pradesh (Unit 1, 660 MW). With the commissioning of these projects, the installed capacity of NTPC is over 68,961 MW as of March 2022. NTPC also commissioned two projects under its joint ventures, the Nabhinagar TPP in Bihar (Unit 4, 250 MW) by Bharatiya Rail Bijlee Company Limited and the Nabhinagar TPP (Unit 3, 660 MW) by Nabhinagar Power Generating Company Limited.
Of the state sector’s thermal capacity addition, the maximum capacity (1,320 MW) was added by Rajasthan Rajya Vidyut Utpadan Nigam Limited, which commissioned the 660 MW Unit 8 at the Suratgarh TPP and Uttar Pradesh Rajya Vidyut Utpadan Nigam Limited, which commissioned the 660 MW Unit 1 Harduaganj Exp II. The Telangana State Generation Company followed next, with the commissioning of the 270 MW Unit 4 at the Bhadradri TPP.
In the private sector, capacity was added by SPIC Electric Power Corporation, which commissioned the 525 MW Unit I of the Tuticorin TPP in Tamil Nadu.
A total of 393 MW of hydro capacity was added in the country during 2021-22, which was entirely added by the private sector. Himachal Sorang Power Private Limited commissioned the 100 MW (Units I and II) Sorang hydroelectric project (HEP) in Himachal Pradesh, while GMR Bajoli Holi Hydro Power Private Limited commissioned 180 MW (Units I, II and III) of the Bajoli Holi HEP also located in Himachal Pradesh. Madhya Bharat Power Corporation Limited commissioned the 113 MW (Units I and II) Rongnichu HEP in Sikkim.
In the renewables segment, the major projects that were commissioned in recent months include Brookfield Renewable India’s 450 MW solar plant in Jodhpur, Rajasthan; Tata Power Renewable’s 300 MW solar plant in Dholera, Gujarat; O2 Power Private Limited’s 250 MW solar plant in Jaisalmer, Rajasthan; Adani Hybrid Energy Jaisalmer One Limited’s 390 MW wind-solar hybrid power plant in Jaisalmer, Rajasthan; ACME Solar Holding Limited’s 300 MW solar power project in Jodhpur, Rajasthan; Azure Power’s 300 MW and 600 MW interstate transmission system (ISTS)-connected solar power project in Rajasthan; ReNew Power’s 250 MW ISTS solar power generation project in Jaisalmer, Rajasthan, among others.
Transmission
Powergrid continued to be the top performer in terms of network addition. In 2021-22, it added around 4,581 ckt. km of transmission line length out the total planned addition of over 14,895 ckt. km across all utilities. Powergrid commissioned several lines during the year, of which the highest addition of 2,337 ckt. km was at the 765 kV level. Amongst the state transcos, those of Uttar Pradesh, Telangana, Maharashtra, Tamil Nadu, Bihar, Gujarat, Punjab and Odisha added more than 45 per cent of the total line length in the state sector.
In the private sector, Adani Power Limited added the maximum transmission line length of 897 ckt. km. Sterlite Grid Limited also contributed significantly to the private sector’s line length addition by completing 383 ckt. km of lines during the year.
Powergrid also led the way in substation capacity addition with 3,000 MVA capacity added at the 800 kV level, 18,500 MVA at the 765 kV level and 15,845 MVA at the 400 kV level. Of the total 78,982 MVA added across all levels, the state and private sectors accounted for substation capacity addition of about 38,407 MVA and 1,000 MVA respectively.
Distribution
As per the audited annual accounts of distribution utilities, AT&C losses stood at 20.93 per cent in 2019-20, as against 23.5 per cent in 2016-17.
As per data collected by India Infrastructure Research, in 2020-21, AT&C losses of 49 surveyed discoms ranged between 6.48 per cent (Tata Power Delhi Distribution Limited [TPDDL]) and 42.79 per cent (Jharkhand discom). Discoms that recorded the lowest AT&C losses of between 6 and 8 per cent were TPDDL, BRPL, BSES Yamuna Power Limited, Torrent Power (Gujarat), Adani Electricity Mumbai Limited, India Power, Uttar Gujarat Vij Company Limited and Kerala State Electricity Board Limited.
Meanwhile, at an all-India Level, as per the power ministry, the average cost of supply (ACS)-average revenue realised (ARR) gap (on tariff subsidy received basis) reduced from Re 0.37 per unit in 2016-17 to Re 0.30 per unit in 2019-20. However, the fall was not consistent, as in the interim, the gap increased to Re 0.49 per unit in 2018-19.
As per utility-wise data collected for 2020-21, 12 discoms reported ACS-ARR gap as zero or negative (indicating surplus). These were Andhra Pradesh Eastern Power Distribution Company Limited (Re -0.2 per unit), Andhra Pradesh Southern Power Distribution Company Limited (Re 0 per unit), Ajmer Vidyut Vitran Nigam Limited (Re -0.1 per unit), Bangalore Electricity Supply Company Limited (Re -0.12 per unit), Dakshin Haryana Bijli Vitran Nigam (Re -0.03 per unit), Dakshin Gujarat Vij Company Limited (Re -0.02 per unit), Himachal Pradesh State Electricity Board Limited (Re -0.32 per unit), Jodhpur Vidyut Vitran Nigam Limited (Re -0.38 per unit), Mangalore Electricity Supply Company Limited (Re -0.31 per unit), Paschim Gujarat Vij Company Limited (Re -0.02 per unit), Tripura State Electricity Corporation Limited (Re -0.05 per unit) and Uttar Haryana Bijli Vitran Nigam (Re -0.18 per unit).
Conclusion
Going forward, while capacity additions by power majors are expected to continue apace in the renewable energy segment, the conventional generation segment is expected to remain subdued. Also, as discoms continue to record high AT&C losses and poor financial performance, all hopes have been pinned on discom privatisation and the newly launched RDSS to turn around the performance of the distribution segment. On the transmission front, in the next four to five years, the segment looks poised for significant investment inflow. In addition to expanding the physical grid, utilities will increasingly need to invest in advanced and grid-enhancing technologies to improve capacity, grid resilience and stability.