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© Confederation of Indian Industry Power Shortage Mitigation Strategy – Pune Model Forum of Indian Regulation (FOIR) Khajuraho Pradeep Bhargava 25 th September,2008.

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Presentation on theme: "© Confederation of Indian Industry Power Shortage Mitigation Strategy – Pune Model Forum of Indian Regulation (FOIR) Khajuraho Pradeep Bhargava 25 th September,2008."— Presentation transcript:

1 © Confederation of Indian Industry Power Shortage Mitigation Strategy – Pune Model Forum of Indian Regulation (FOIR) Khajuraho Pradeep Bhargava 25 th September,2008

2 © Confederation of Indian Industry Power Shortage Mitigation Strategy – Pune Model 1. Motivation / Compulsion For The CII Initiative  Maharashtra Had been Promising Its Citizens Power Shortage “For Next 3 – 5 Years”.  Neither Centre Nor Neighboring States Had Surplus Energy to Share on a Sustained Basis  Load Shedding A Reality – We only Speculate “How Much” ?  Legal Framework / Political Compulsions Rightly demanded Uniform Treatment for Pune also.  So CII, Pune Evolved A Solution with our Enlightened Regulator (MERC) which ensured Relief with ….  Zero Help From the Governments  Financial Pass Thru for State Utility (MSEDC)  No Extra Demand Or Diversion from the Grid  No “Out of Pocket” for Industry.  Reasonable charge recovery from the Beneficiaries (Citizens of Pune) No Load Shedding In Urban Pune After Years Of Hardships – Almost A Miracle

3 © Confederation of Indian Industry 2. How The Pune Model Worked MSEB Grid 200 MW MSEB Grid 550 MW 100 MW 650 MW Pune Load 750 MW Shortfall – 100 MW Load Shedding Shortfall – Nil Zero Load Shedding Self Generation Consumption Extra Cost (CPP) @ Rs. 6 Per Unit Rs. 10 Crore / Month Recovery (Citizens) 230 Mn Unit / Month Rs. 0.42 / Unit Financials Before After Self Contained, Participative Model – Win Win Power Shortage Mitigation Strategy – Pune Model

4 © Confederation of Indian Industry  Pune operated with Zero Load Shedding from June’06 to March’08  With Pune Load increasing and Maharashtra Energy Gap Widening, the expectation of “Marginal Power” to mitigate Load Shedding went up  From 540 MW hr/day – (90MW x 6 hrs)  To 1800 MW hr/day – (150MW x 12 hrs)  This was not workable with DG – and MSEDC further increased the expectation to 300MW x 12 hrs – 3600 MW hr/day (being challenged)  Once again, through MERC, concept of Distributed Generation Based Distribution Franchisee (DGBDF) came into being  Tata Power Company (TPC) became the Interim Franchisee for Pune (as well as Thane/Navi Mumbai) with Tata Power Trading mobilizing Power.  In Operation since April,08 – with “dedicated” power being brought into Maharashtra grid for Pune/Thane and recovery of Reliability charge. Power Shortage Mitigation Strategy – Pune Model 3. Pune Model Revisited – Birth of DGBDF – Model 2 Landmark Decision by MERC – Can be the Framework for All State, For Specific Communities

5 © Confederation of Indian Industry 4. Challenges (Conceptual / Practical) Faced During Implementation  Why Indulge – Sovereign Responsibility of State to provide Services.  “Pseudo” Socialism – What about “Have Nots” !!!  What is the “Hidden Agenda” of Industry ??  Give me a “Long Term Solution” – Choose to Ignore Short Term  “Public Posturing” is at Premium over “Private Conviction”.  Where Does Final Responsibility rest in this “Multi Star” Show.  Continuity / Consistency of a Voluntary Gesture. Do We “Give Up” Because of Potholes / Speed Breakers – Or “Give To” Society Comfort / Dignity Power Shortage Mitigation Strategy – Pune Model

6 © Confederation of Indian Industry 5. What Has Been Unleashed / Learnt In This Experience  Raising / Analysing Problems Is Easy – Become part of the Solution.  Enhance Mental Bandwidth – Most Barriers Are Self Imposed.  No Free Lunches – Pay For A Facility – And then Demand its Availability  Truly A Public Private Partnership – Regulator / Citizens / Industry / Service Provider  What Better CSR – Industry Using Its Assets to Bring “Light” to 4 Mn Citizens.  There are few things Governments Cant / Wont Do…..Citizen Power Can.  “Fringe Benefit” – Lower T & D Losses / Cleaner Environment / Encourages Conservation. Having A Good Idea Is Not Good Enough – Success Demands Tenacity & Team Work Power Shortage Mitigation Strategy – Pune Model

7 © Confederation of Indian Industry 6. Road Ahead  Regulator’s Blessings, Citizen’s Engagement, Utility Participation vital for such a Model  This is perhaps the Only Short Term Option (1 -3 years) available for Communities in India. “Power for ALL” is at best a 2012 Agenda.  We need to continue our efforts on all Other Fronts – Generation, Conservation, Non-Conventional Energy, Reducing T & D etc. etc…  Need to Identify Areas which have :-  Reasonable ATC Losses  Have Citizens who are willing to pay for Facility  Industrial Base (if CPP Basis to be used)  SERCs to take a Proactive Role – CII/ Citizen Bodies will Initiate Load Shedding is Not the Answer to Demand Management – Offer Choice to Those Who Can Afford Power Shortage Mitigation Strategy – Pune Model

8 © Confederation of Indian Industry

9 BACK UP A) Basis : Average Load Shedding for Pune Urban600 MW Hr / Day (as per Protocol agreed by MERC) 216 Mn Units / year B) CPP Cost : Variable Cost of CPP Generation HSDRs. 11.04 / unit (Fuel, consumables)LDORs. 8.24 / unit Variable Energy Tariff of MSEDC to IndustryRs. 4.61 / unit (including FCA, Peak Hour Tariff etc.) Amount to be Reimbursed to stay Cost Neutral HSDRs. 6.43 / unit LDORs.3.63 / unit C) Total Cost to be Reimbursed to CPPsRs. 129 crore / year (85% HSD, 15% LDO) D) Total Energy Units sold by MSEDC in Pune (Urban)3066 Mn Units (excluding domestic consumers upto 300 units/month) E) Reliability Charge for Consumers of Pune UrbanRs. 0.42 / unit (to recover cost payouts to CPPs) Power Shortage Mitigation Strategy – Pune Model


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