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4/29/12

THE NEW PHASE OF

GROWTH

Presented by POWER SECTORAfreenAnju

AnkithaDivyaJayasankarShruthi.S


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INTRODUCTION

Power generation has risen already by record numbers thisyear though this is a drop in an ocean of shortages.

It is expected to almost double from the current 177gigawatt to 300 gigawatt by 2015.

By the 13th Plan (2017-22) private sector generation willbe higher than the state sector, says Gurdial Singh,chairman, Central Electricity Authority.

Two giant power projects are racing against tight

deadlines. When they are completed, the two plants combined will

generate over 8,000 MW that is more than half theadditional capacity generated this year.


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POWER TO THE HUBS

Power shortages will

be resolved through

Krishnapatnam -

10,000 MW


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DEVELOPMENT STAGE

Prior to liberalisation growth was at a snailspace even though there was insatiabledemand for anything they produced.

Reluctance to go in for high paced growthdue to bureaucratic hurdles and uncertaintyof profit.

Tata Power has gone into high-voltage

expansion mode now- aims to add a huge5,000 MW in the next two years and touch25,000 MW by 2017. Its Maithon project willstart generating 1,100 MW.

Reliance Power aims to produce 35,000 MW


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Stepping on the throttle

Adani Power

Essar Power

Lanco Infratech

Moser Baer Power Projects

GVK Power

BRIGHT PROSPECTS:Control room at the

Lanco power plant in


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CHANGING POWER EQUATIONS

The Electricity Act, 2003

Licensing of the generation sector

Introduction of changes like Open Access

under which large consumers in one state

can buy power from generating stations in

another.


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SELLING PROPOSITION

Merchant Power

Firm like Essar Power will sell 75 per cent of itspower under rates fixed by long-term contracts

and 25 per cent as merchant power.CESC vice- chairman,Sanjiv Goenka-company will

ensure that its long-term power purchaseagreements bring in enough to cover its debt.

Merchant power will not command todayspremiums. But it will still be higher than PPAtariffs for long.

The biggest problem that private generation

firms have always faced is the parlous financial


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SELLING PROPOSITION


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CONTINUTION

Biggest problem that private generationfirms have always faced is the parlousfinancial condition of state electricityboards (SEBs)

Many power-distributing companies are inthe red, as they offer cheap and at timesfree power.

Hence, they cannot buy power at higherrates. Three SEBs Tamil Nadu, Rajasthanand Uttar Pradesh account for 70 per centof SEB losses

This makes it tough for anyone selling power and eneratin costs are onl oin to


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continution

Fast growth will bring all kinds of other difficulties in itswake.

Already there is a growing shortage of trained people.

One expert reckons that the industry will need about25,000 trained hands if it is to add 50,000 MW.

Also, there is a global shortage of power equipment. The

tried and tested producers (like Bhel, the Americans andthe Germans) have big order books and waiting lists.

Chinese equipment is both more easily available and morecost competitive, but they have much less of a trackrecord. Still, it is reckoned that over 75 per cent of thelatest orders have gone to the Chinese.


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CONTINUTION

It is the coal shortages that are going to be a threat to thegrowth of the power industry in the coming years.

power industry executive told that almost 200 milliontonnes of coal will need to be imported annually to meet

generating demands. Coal prices are rising and imported coal is almost four

times costlier than Indian coal.

If that is not enough, it is doubtful whether Indian ports

can cope with such a volume of imports, And theIndonesians recently decided to place a tax on coalsexports.

It will throw a spanner in the works for several Indian firmswhich have invested in mines there.


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CONTINUTION

Despite all the hurdles, everyone isconvinced there is money to be made.

Around 45 per cent of Indian households

do not have access to power and thebalance do not have access to it on a 24-hour basis.

Per capita consumption of electricity, ataround 610kW per annum, is around aquarter that of China.

From the industrys point of view, it is a

great place to be.


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THANK YOU!!!

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