energy crisis in ndia

7/29/2019 Energy Crisis in Ndia

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Crisis to opportunity and innovation

India power needs are immense

Supply Continuously falls short of demand

Govt and private sectors are increasingly truing to hydropower over coal

The 150 dams planned for Arunachal Pradesh threaten to wipe out swathes of forests, dozens of

tribal cultures, and some of the world’s best white-waters.

An energy crisis could choke growth

On July 30 and 31, the electric power grid in north and eastern India crashed twice, leaving half of the South

Asian nation literally in the dark. In what was the largest power outage in world history, 18 states and two

territories lost electricity. An estimated 670 million people were affected. Railways, including the Delhi Metro

(subway), screeched to a halt. Traffic lights went dark, creating massive traffic jams. Factories and hospitalsswitched to diesel-powered backup generators, and resourceful Indians turned to other power sources or just

endured the sweltering summer night. In eastern India, more than 200 miners were stranded below ground for

several hours when elevators stopped functioning. All were later rescued.

The western and southern parts of India were unaffected, and power was about 80 percent restored by late on

the 31st. However, the outage caused financial losses to Indian businesses estimated in the hundreds of millions

of dollars—and significant embarrassment for Asia‘s third-largest economy. India‘s government undertook an

investigation of what caused the grid‘s collapse. The recent outages resulted when parts of the grid were shut

down for upgrading, and other circuits became overloaded. The complex network of electric transmission

systems requires coordination and discipline on the part of all members.

The underlying cause was obvious enough: the country‘s aging electrical infrastructure and shortage of power -

generation capacity. Not all Indians enjoy reliable access to electricity, and many are used to regularly scheduled

blackouts. Many villages in rural areas have no electricity. But demand is outstripping supply as economic growth

makes electricity consumers of an ever-growing share of the country‘s 1.2 billion people. Some experts say that

massive investment will be needed in India‘s power infrastructure to avoid similar power failures in the future.

It has become a common sight that angry citizens take to the streets in protesting

against the abysmal power situation. Some of the areas receive only an hour of

electricity every day. Police has to control the law and order situation on account of people’s

agitation.

State governments blame Centre for not allocating enough electricity to their states. The

Governments try to blame its predecessor. The people do not buy this excuse. Who is to blame for

the abysmal power situation this summer?



Those in Government find it easiest to pass the buck. The states blame the Centre. The Centre

blames the states. Power is on the Concurrent List of the Constitution. Both the Centre

and states must share the blame.

The Centre must take the rap for the shortage in generation of power. The peak

power deficit-the gap between demand and supply in the summer of 2010-accordingto the Government's own calculations was 10.8 per cent. The responsibility for

distributing available power inefficiently falls on the states. Losses in distribution

average over 30 per cent across India.

At the Centre, the power, environment, coal and heavy industries ministries have in various ways

acted as obstacles to the addition of capacity. In the states, populist governments and spineless

electricity regulators have done little to reform ailing distribution networks. The situation is expected to

get worse before it gets better.

The Central Electricity Authority (CEA), the main advisory body to the Union power

minister, has set a target of 100,000 mw of additional power generation in the period

of the 12th five-year plan between 2012 and 2017. That is what is needed to meet

the power demand of an economy forecast to grow at 9 per cent per annum. The

Planning Commission accepts this target but Environment Ministry does not which

says that the target is "ecologically unsustainable".

Environment Ministry is worried about the impact this additional generation will have on climate

change. Seventy per cent of this additional capacity is to be added through coal-based thermal power.

Given the dismal record over the past 20 years, Environment Ministry need not worry about the

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Government m eeting its target. According to

Planning Commission estimates, only an average of 50.5 per cent of overall targets were met in the

eighth, ninth and tenth five-year plans between 1992 and 2007.

Every major political formation has governed the country in that period none has much to be proud of

in terms of performance in the power sector. The target for the 11th plan (2007-2012) has already

been revised downwards from 78,700 mw to 62,374 mw. With a year and a half to go until the end of

2012, only around 50 per cent of that revised target has been achieved. Realistically speaking, the

Government will do well to hit 60 per cent of its original target by the end of 2012.

The most serious bottleneck in generation is the shortage of coal. At the end of

2007, the gap between the demand and supply of coal was 35 million tonnes. It is

expected to be around 83 million tonnes at the end of 2012. Says the mid-term

appraisal document of the Planning Commission: "The shortage would have been

even more had all the planned coal-based power plants been commissioned on

time." By 2017, the shortage is forecast to be 200 million tonnes.

As per the government the shortage of domestic/imported coal affected thermal generation. Some of

the blame for the shortage can be laid at the door of the environment minister whose controversial

'no-go' policy announced in 2009 imposed a ban on mining in heavily forested areas. It declared 35

per cent of forest area in nine major coal-mining zones as 'no-go' zones. That led to an immediate halt

of mining activity in 203 blocks which had a potential capacity of over 600 million tonnes.

Coal Ministery argued that this ban could affect power generation to the tune of

1,30,000 mw. The matter is now before a Group of Ministers (GOM) on mining.

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The fallout of the nuclear accident in Japan means that thermal power is back at the forefront.

Hydro pow er continues to flounder because

of concerns over rehabilitation and resettlement.

Another serious bottleneck to generation is the shortage of equipment. According to a 2010 report

prepared by consulting firm KPMG on the power sector, equipment shortages have been

a significant reason for India missing its capacity addition targets for the 10th five-

year plan. The shortage has been primarily in the core components of boilers,

turbines and generators.

What may also deter private investors in the future is the inability of state electricity boards (SEB) to

buy power at commercially viable rates. When India's largest thermal power generator, the

Government-owned National Thermal Power Corporation (NTPC) recorded a mere 1 per cent growth

in net profits in 2010-11, NTPC made the power stations available, but the SEBs did not

draw power from those projects. This led to less generation of power and therefore

less revenue. The drawdown in generation by NTPC led to a loss of 13 billion units

(bu) of electricity in 2010-11. India's annual generation of power is estimated at

around 800 billion units. NTPC's drawdown is 1.6 per cent of this total. If selling

power to SEBs is a problem for NTPC, it is likely to be a problem for everyone else.

The combined losses of SEBs currently stands at Rs 70,000 crore. The 13th Finance Commissionhas forecast this figure rising to over Rs 1 lakh crore by 2014.

We cannot sustain the improvement in the quality of power supply unless tariffs are

revised. Delhi's distribution companies lose Rs 1.79-1.93 per unit of power supplied

to consumers. Planning Commission calculations of the financial performance of

distribution companies in 20 major states (excluding Delhi and Orissa) shows that

the average loss per unit supplied to the consumer was 90 paise in 2009-10. The

loss per unit sold has hovered steadily between 80 paise and Re 1 between 2005and 2010. Contrary to popular perception, Indian consumers on average pay much

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less for a unit of electricity than countries which are richer, both in terms of income

and resources. In India, the average tariff charged is eight US cents per unit

compared to 12-15 cents in Canada, South Africa and the US and 19-20 cents

in much of Europe and the developing world.

India will have to start thinking like a developed country. It is imperative that tariffs are

regularized.

A committee headed by former Comptroller and Auditor General V.K. Shunglu is

working to recommend ways to reduce losses suffered by distribution companies. On

top of the list of recommendations is reportedly the need to take action against

inactive state electricity regulatory authorities which actually set the tariff.

The regulatory authorities have statutory independence but usually act under

pressure from state governments. In Tamil Nadu, for example, tariffs have not been

revised for seven years. In Delhi, they have not been revised for three years. That

needs to change. Politicians, regulators and citizens need to recognize the need for

viable tariffs.

The transmission network needs to be strengthened to encourage private investors

is the principle of "open access" where they are not captive to any one SEB for

sales. SEBs are also free to look outside their state to buy electricity.

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wednesday, may 25, 2011

ROLE OF ESCO IN ENERGY CONSERVAION

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Seeing the huge scope of energy conservation the GoI with state governments is promoting

investments through public-private partnerships in tapping renewable energy resources from mini

hydro, solar, biomass, urban/industrial waste, cogeneration, etc. For this purpose the State

Governments are notifying nodal agencies for carbon credits under the Clean Development

Mechanism (CDM).

All project developers (private as well as Government) can have assistance of these designated

agencies in terms of seeking carbon credits under CDM for both supply new and renewable sources of

energy as well as demand (energy efficiency) side projects.

With a view to intensifying efforts towards Energy Conservation Action Plan to pursue a

harmonious growth in energy efficiency different state government has nominated different

organization to act as nodal agency the purpose of these is to implement energy efficiency

programmes as per guide lines of BEE.

The major objectives of the Energy Conservation Action Plan are to:

Raise the profile of energy conservation movement with the active participation of the stakeholders, in

consonance with the national objectives of reducing the energy intensity of the economy.

Identify and implement cost-effective energy efficiency programs through a sustainable mechanism;

Encourage energy efficiency activities by drawing upon the prevailing best practices relevant to the state

and keeping in mind the national programs and activities being launched by BEE. These include the

concerns of state electricity regulator in the domain of energy end-use efficiencies and focused

demand-side man agement (DSM) initiatives.

Encourage a spurt towards professional activities with adequate emphasis on self regulation and market

principles, and monitoring and evaluation of programs through quantitative metrics (performance

indicators).

Create consumer awareness vis-à-vis energy conservation and energy efficiency consumer information

and provide training opportunities for key professionals such as energy managers and auditors,

building designers, government officials, and facility managers.

Protect and enhance the local, national and global environment.

Towards the implementation of the Energy Efficiency Program the different states are taking up

Governmental Buildings to begin with. The governmental building sector offers substantial energy

saving potential in both new and existing building constructions. One of the major drivers for energy

efficiency will come from the Energy Conservation Building Code (ECBC) launched by BEE in May

2007. The Governments are announcing the mandatory following measures applicable to the

governmental sector:-

Issuing notifications regarding the mandatory use of solar water heating systems,

Use of compact fluorescent lamps, Use of BIS marked pump sets in government and private buildings, including industries and



Use of solar water heating systems made mandatory in buildings having an area of more than 500 sq

yard.

Towards the beginning the state governments are going ahead with replacement of incandescent bulbs

with compact fluorescent lights (CFLs) in all government buildings and offices, including government

guest houses, offices of board, corporations, cooperative organizations and municipalities. Further the

SDAs are adopting strategies related to existing buildings in addition to ECBC to tap the energy saving

potential in new construction/ existing buildings

SDAs play an important role in developing better guidance on conducting building energy

audits and developing commercial building energy use benchmarks (kWh/sq. m.) that would help in

screening potential retrofit projects and help organizations set performance targets against peer

benchmarks.

There is a vast scope to improve energy efficiency in office buildings, hospitals, schools and

universities. Several studies have shown that avenues to curtail energy use to the extent of 30-50% in

end uses such as lighting, cooling, ventilation, refrigeration, etc. The potential is largely untapped

partly because of lack of an effective delivery mechanism. Performance contracting through ESCOs is

an innovative process.

An energy service company (acronym: ESCO or ESCo) is a commercial business providing a

broad range of comprehensive energy solutions including designs and implementation of energy

savings projects, energy conservation, energy infrastructure outsourcing, power generation and

energy supply, and risk management.

The ESCO performs an in-depth analysis of the property, designs an energy efficient solution,

installs the required elements, and maintains the system to ensure energy savings during the payback

period. The savings in energy costs is often used to pay back the capital investment of the project over

a five- to twenty-year period, or reinvested into the building to allow for capital upgrades that may

otherwise be unfeasible. If the project does not provide returns on the investment, the ESCO is often

responsible to pay the difference.

There is a draw back in this concept particularly to energy sector in India as in most of the

cases the base line data of energy consumption is not available, for example if the ESCO is appointed

say for replacement of all agriculture pumps with energy efficient pump sets (EEPS), investment is to

be made by ESCO, it has to replace all inefficient pumps and then also it has to take care of their

replacement within specified payback period, the saving thus achieved is to be distributed between

ESCO and the employing agency. But here comes the main problem who will tell the saving? How the

saving can be calculated as the base line data is not available. Most of the supply in agriculture sector

is un-metered at consumer end even the sub station meters of secondary substation are not having

proper metering. Even if the meter is working properly then there is no maintenance of records.Further most of the feeders has a mixed load so there is no method to calculate the net saving in



energy after energy efficient device is installed by the ESCO. Same is the case with street lights where

lies a huge potential by replacing sodium vapor lamps with LED, here again base line data is not

available for the purpose of evaluation.


monday, april 18, 2011

Energy Efficiency In SME Sector

As per the energy policy of GoI power to be made available to all by 2012. One of

the strategies to improve power scenario includes promotion of energy efficiency and

its conservation in the country, this is found to be the most cost effective option to

augment the gap between demand and supply. Nearly 25,000 MW of capacity

creation through energy efficiency in the electricity sector alone has been estimated

in India.

National Productivity Council (NPC), an autonomous organization under the Ministry

of Commerce, Government of India, was asked by BEE to undertake the study of

energy saving potential in all 35 states / UTs. The study focused only on estimation

of the total electricity consumption and saving potential in different sectors of each

state / UT. The potential for savings is about 15% of the electricity consumption. The

sector wise aggregated potential at the national level is as under:

S.No. Sector Consumption(Billion KWh)

Saving Potential (BillionKWh)

1. Agriculture Pumping 92.33 27.79

2. Commercial Buildings/

Establishments with

connected load > 500 KW

9.92 1.98








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3. Municipalities 12.45 2.88

4. Domestic 120.92 24.16

5. Industry (Including SMEs) 265.38 18.57

Total 501.00 75.36

The BEE study pertaining to SME revealed the overall saving potential of the

clusters is about 72,432 TOE (Tonnes of oil equivalents) which is 27.4 per cent of

the total energy consumption in SMEs.

Though, large numbers of SMEs, located in clusters in various states of the

countries, have large potential for energy savings, there is not much authentic

information and data available with respect to their energy consumption and energy

saving opportunities.

Energy Efficiency in the SME sector assumes importance because of the prevailing

high costs of energy and supply related concerns.

Bureau of Energy Efficiency (BEE) is implementing a program (BEE‘s SME Program)

to improve the energy performance in selected SME clusters.

The project will conduct situation assessment of 35 (maximum) clusters in the

country to assess the situation vis-à-vis the number of operating units, energy usage,

potential for saving energy and probable impact of intervention. This will lead to

identification of clusters for intervention. A Technology and Energy Use Analysis in

identified clusters will be carried out that will identify in detail the prevalent

technologies in the sector, audits them for energy use on a sample basis and identify

opportunities for energy saving through either changes in technology or through bestpractices. This study will also identify possible sources of technology and/or

expertise in different clusters as the case may be.

Because of the similar characteristics like geographical location, markets, products

manufactured, technology, development issues and common pool of resources,

cluster based approach has been undertaken while working with SMEs. Generally

this has been found to be resource efficient and effective.



The project will pool available resources as those from WB and UNDP which have

already shown interest in partnerships with BEE for undertaking work on EE with the

MSME sector in India. Thus the project will limit drawing of GoI to such levels as may

be required after financing from WB UNDP-GEF has been made available

Ministry of Micro, Small and Medium Enterprises (MoMSME) has agreed in principal

to capitalise on the DP Rs prepared under the BEE’s SME program. MoMSME

proposes to provide financial support for implementation of the technologies

identified in these DPRs .

Small Industries Development Bank of India (SIDBI) will also act on similar lines and

will provide subsidized finance for implementation of energy efficiency technologies

as identified in the DPRs. A MoU in this regard has already been signed.

BEE is also the Implementing Agency for GEF (Global Environment

Facility) ‗Programmatic Framework for Energy Efficiency in India in which World

Bank & UNIDO are the GEF agencies working on Energy Efficiency in SME clusters.

World Bank would work in 5 clusters & UNIDO in 12 clusters.

Bureau of Energy efficiency has taken a nationwide energy efficiency program

covering 25 SME clusters. Which include Cold Storage, Carpet, Pottery, Brass,

Foundry and Glass Clusters.

Stake Holders for implementing EE in SME are-

Government.

Development Agencies.

Energy Consultants.

ESCOs.

Manufacturing Companies

Lenders.

Role of the Government is to encourage the SME to adapt EE measures, educate

them, give them incentives for taking up energy efficiency, encourage them to

identify EE projects The role of ESCO is also very important as it has to adopt

modern technology for implementation of the EE project it has to educate the SME

by telling him the benefits of the EE project. ESCO has to prepare the DPR withsimple calculation for the payback and debt serving feasibility. The DPR should be



easily understood by SME and the lender. The most important stake holder is the

SME, as he is the ultimate beneficiary. Therefore he must have the orientation to

implement the EE program and motivation and inclination towards EE program, he

must understand the project. It is therefore important to-

motivate the SME.

motivate other stakeholders.


sunday, march 27, 2011

Agriculture Demand Side Management (Ag DSM)

Bureau of Energy Efficiency (BEE) is a statutory body under Ministry of Power, Government of India. The mission of BEE is to institutionalize energy

efficiency services, enable delivery mechanism in the country and provide leadership

to energy efficiency in all the sectors. The primary goal of the Bureau is to reduce the

energy intensity in the Indian economy.

Seeing the supply and demand gap the DSM has become the need of thehour. Maharastra State Electricity Distribution Co. Ltd (MSEDCL), calledMahadiscom or Mahavitran in short has taken a lead towards DSM, the company started taking measures towards load management in 2005 by increasing the tariff for increased consumption and decrease in tariff for reduced consumption compared

to the last year . The Maharastra Electricity Regulatory Commission has provided for a Charge

as well as a Rebate, consumers were incentivised to reduce demand through better

planning and utilization of electricity, rather than by fiat. Since then the MSEDCL hasa provision of LMC (Load Management Charges) in its tariff. It has been observed

that rural areas has a tremendous scope in load management as the pump sets

used for irrigation purpose are highly inefficient and since the tariff applicable for

them is flat rate tariff the farmers have least interest in efficiency of the equipmentshence there is a need of Agriculture DSM. State of UP has yet to incorporate LMC..

UPERC in its tariff order has emphasized the need of DSM, as per ERC “The effect

of Demand Side Management should reflect in lesser purchase of costly power due to effective energy conservation measures. This shall reduce the revenue








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requirement of the DISCOMS. The cost of such DSM projects would be offset by the savings in power purchase cost due to reduction in demand. This should be represented as a separate cost element which shall be allowed by the Commission as a part of the Annual Revenue Requirement of the DISCOM S”.

In order to accelerate energy efficiency measures in agriculture sector, BEE

has initiated an Agriculture Demand Side Management (Ag DSM) programme inwhich pump set efficiency upgradation would be carried out through Public Private

Partnership (PPP) mode. The objective of the program is to create appropriate

framework for market based interventions in agricultural pumping sector by

facilitating conducive policy environment to promote Public Private Partnership(PPP) to implement the projects.

Under this scheme of BEE, first Pilot Ag DSM project was launched at

Mangalwedha subdivision of Solapur Circle in Maharashtra. This first pilot Ag DSM

project covers 3530 agricultural pumps connected on five feeders (Bramhapuri,Nandeshwar, Borale, Bhose & Kharatwadi) in Mangalwedha & Pandharpur

subdivisions. (All the five feeders are segregated agricultural feeders, feeding power

to mostly agriculture pumps under the service areas)

The Detailed Project Report (DPR) is prepared after an exhaustive survey and

detailed energy audit study of the pump sets in the pilot area. During the energy

audit study detailed information (about all the agricultural consumers) such as details

about pumps (number, Type, make, age and rating), water requirements /

consumption, status of meter installation, number of harvesting

cycles, cropping pattern, underground water level in different seasons, power supply

pattern and socio-economic conditions etc. is collected and analyzed.

This detailed project report provides an insight to Pump manufacturers /

Energy Service Company for making investments in implementing energy efficiencymeasures on rural pump set feeders. The intervention would lead to lower energy

supply on the feeder, and hence, could result in lower subsidized energy sale by

utilities and lessen the subsidy to be paid by the State Government.

The salient features of the DPR are as below-

• Most of the pump motors (60-70%) have been rewound one or two times.

• Low voltage up to 290 V at consumer end is observed for few DTR.

• The workmanship quality for pump set installation was poor. No capacitors

Connected to agricultural pumps.

• Even though the power availability is for 10 to 12 hours, intermittent power failuresare observed frequently.

• It is also observed that most of the DTR‘s are overloaded leading to frequent

transformer failures.



• The major reasons for pump set failure and lower discharge output was erratic

power supply and cases of extreme low voltage.

Due to huge gap in the demand – supply situation of the state power grid, theagriculture feeders are faced with severe load shedding.Thus, whenever power is

available most of the pump sets are automatically switched ON to supply water for irrigation. The farmers have made provisions for automatic starting of pumps . This is

carried out either by auto-starter or starter is kept in on condition, continuously during

the season, defeating interlocks.

Actual Pump set rating higher than name plate rating: It is also been observed that even though sanctioned demand is 3 HP or 5 HP, power rating of most of the pump sets is higher than sanctioned demand. The reason for measured power consumption rating higher than sanctioned demand is that most of the farmers have rewound the pump sets suitably to draw more power and deliver higher water

discharge. Since farmers are charged on flat HP basis this results in potential revenue loss to DISCOM . This is the major reason for no encouragement for

deployment of more efficient pumps. It is difficult to make the farmers agree to have their pumps replaced, as it requires repeated efforts to make the farmers fully conversant to the objectives of the project. Hence social opposition is expected for metering of power supply at pump level. But there will not be that much opposition for metering at transformer level.

The farmers have reported extreme low voltage as the major cause for motor

burnouts and lower pump output. The pump set selection by farmers is mainly driven

by voltage constraint (Voltage imbalance) and water level variations.

Pump set Installations: The pump sets installation is inappropriate with lackof proper foundation and footings. The ground surface water pump sets are merelyplaced on wooden planks and not properly anchored to the ground. The pump sets are observed with high vibration levels, which also contribute to lower operating efficiency.

The efficiency measured for these pumps is in the range of 15 % to 30 %. Only a small fraction of pump sets have efficiency below 10 % and above 55%.

Pumps with efficiency below 10% are due to a combination of several factors like use of frequently rewound motors, non standard pumps, no maintenance, poor selection of pump, extremely low water depth, low voltage supply leading to lower

output and higher power consumption. Pumps with higher efficiency than 55 % aredue to recent installations and are very few in numbers.

Parameters Affecting Pump Set Efficiency Performance

There are various parameters that could affect the pump set efficiency

performance. Parameters identified that could affect the pump performance are

listed below -

• Energy Inefficient Pump Sets

• Improper pump selection and usage.

• Undersized pipes.



• Suction head Variations and large discharge lengths.

• Ineff icient foot valves and piping system.

• Motor rewinding and low voltage profile

• Water table variations

• Other common causes

Energy Inefficient Pump Sets

Due to lack of awareness about energy efficiency and flat HP based tariff structure for agricultural sector, energy aspect is overlooked by the farmers

while selecting the pump sets.

For conventional pump sets the efficiency variation with respect to change inflow and head is very high. At both the extreme ends of the pump curves

(head Vs flow) the efficiency of the pump set is low. However better designed

Energy Efficient Pump Sets (EEPS) have a flat top efficiency characteristic, so

that any reduction in efficiency away from the ‗Best Efficiency Point‘ (BEP) issmall. As guaranteed by energy efficient pump manufacturers the difference

in best efficiency of a good design is marginal and at the most up to 3% to

4%. The energy efficient pump sets could be selected to match the capacity

and head requirements and to operate at BEP during the normal operatingconditions. This will result in maximum energy savings, as compared to

present inefficient pumps. Improper Pump Selection and Usage

The educational level of the Indian farmers is not adequate to understand the technological aspects of pump operation. This leads to lack of awareness on pump selection, operation & maintenance . The improper selection and

operation leads to poor efficiencies and wastage of energy.

Field study has indicated that average overall efficiency of the pump sets is

around 28%.

The lower efficiency is also due to improper selection of pumps andmismatching prime movers and due to inferior quality of the pumps being

marketed. The selection of the pumps should be governed by the

characteristic curves i.e. the efficiencies in the various ranges of flow and

head valves and for normal operating condition, the efficiency should bemaximum.

Baseline Energy Consumption

For implementing the Ag DSM it is most important to know the base line energy

consumption (BEC) of specified pump sets connected on pilot project feeder. TheBEC was estimated for FY 2009 (Base year) by two different approaches

specified below. One approach is based on past consumption data whereas other

approach will be based on the detailed audit study undertaken in the region.

1. Approach 1: Here baseline energy consumption of existing pump sets connected

on pilot project feeder lines is estimated based on last three year annual



consumption data and monthly consumption data of metered consumers in the

region (Mangalvedha sub division).

In this approach the average consumption norms for metered consumers areapplied to the non metered consumers in pilot project to arrive at their monthly

consumption. This approach is also approved by MERC in determining thetariff of agricultural consumers.

The baseline energy consumption for 2221 agriculture pumps operating under

the 4 feeders has been arrived based on data available from MSEDCL.

The metered consumers are categorized on the basis of sanctioned HP loadand their monthly average consumption is taken as representative for that

particular HP category pump consumption norms to arrive at the total

consumption of 2221 pump sets considered under the pilot project. For thepurpose, 2221 pump sets are segregated based on their sanctioned

demand on HP basis.

The baseline energy consumption arrived at Approach 1 is cross verifiedbased on last three year annual energy consumption by project feeder

lines. The four pilot project feeders are segregated agricultural feeders

supplying power to agriculture consumers. However there are few

residential consumers that are also connected on these feeders.

The annual energy consumption for all the four project feeder lines for last 3

years is provided by MSEDCL. The last three year average energy

consumption and average distribution loss levels for Maharashtra state isused for estimating the baseline energy consumption, the annual average

energy consumption for all four project feeder lines is 21.16 MU at theMSEDCL substation end which also includes distribution losses. MSEDCL

average distribution losses are 26.2 %. The baseline consumptionattributable for 2221 pump sets is arrived at after deducting the losses

from last three year annual energy consumption. Thus the baseline

consumption is about 15.62 MU.

2. Approach 2: As per this approach, baseline energy consumption of existing

pump sets of pilot Ag DSM project is estimated based on detailed audit study.

The average operating efficiency and average input power in kW, for existing

pump sets of different types such as monoblock, submersible and flexible

coupling and for different HP ratings are estimated after analyzing the fieldstudy measurements.

This average energy efficiency and average input power norms along

with assumptions of average operating hours has been applied to totalno of pump sets categorized as per their ratings and types to arrive at

baseline energy consumption by total 2221 number of pumps sets

connected on project feeder lines.

As discussed in earlier sections, even though the supply isavailable for 8 to 10 hours on daily basis, not all the pump sets operate continuously.The reasons identified for not all the pump sets operating continuously

are, varying irrigation requirements, non availability of water in the well,non availability of farmer to switch the pump set on and pump sets



under repairs. Hence annual average operating hours are used to estimate the baseline energy consumption of all the pump sets connected on project feeder lines .

Based on last 3 years annual average energy consumption of 21.16 MU

recorded at the substation end of project feeder lines and MSEDCLdistribution losses of 26.2% the energy consumption for 2221 pump

sets is arrived at 15.62 MU. Where as baseline energy consumption as

per approach 1 is 16.49 MU. The sum of average input power for all

the pump sets is around 9523 kW based on energy audit study.

Average operating hours for all the pump sets is estimated based onthis information as provided below,

Annual Average Operating Hours=Energy Consumption ,15.62 MU *10^6

= 1640

Sum of average input power for all the pump sets, 9523 kW

Annual Average Operating Hours =Energy Consumption ,16.49 MU * 10^6=

1732

Sum of average input power for all the pump sets, 9523 kW

Thus the annual average operating hours for all the pump sets connected on

project feeder lines are estimated as 1640 and 1732. However, to be on

conservative side average operating hours are assumed to be 1640.

The annual average operating hours of 1640 are multiplied by the average inputpower per pump set and total number of pump sets for each categorized

based on rating and type to estimate the baseline energy consumption. As per load shedding protocol electricity supply hours of MSEDCL can not be

less than 8 hours per day i.e. 2920 hrs per annum. In addition analysis of

historical data for past several years with regards to water availability,

seasonal variation and cropping pattern, indicate that the water availabilityand seasonal variation will remain the same in future years and will not have

any impact on pump set operating hours. Hence the assumption of 1640

annual average operating hours stands appropriately.

Thus the baseline energy consumption based on approach 2 is 15.23 MU.

Since the baseline consumption estimate based on approach 2 is on very

conservative side it is used in the preceding sections to estimate energysaving potential.

Estimates of Energy Saving Potential

1. The energy could be saved by improving the overall system efficiency either by

partial rectification or by complete replacement.

2. The partial rectification covers the options other than replacement of pump sets

(Motor & Pump) as listed below,

• Replacement of inefficient foot valves

• Removal of unnecessary pipe lengths



• Removal of unnecessary bends

• Reduction in height of pipe above the ground

• Replacement of GI pipes with HDPE/PVC pipes

• Installation of capacitor banks for improving power factor

3. With partial replacement, farmers benefit in terms of more water discharge from

the existing pumping system. However the reduction in energy requirement ismarginal.

4. The complete replacement also covers the replacement of existing pump set

with energy efficient pump set along with the options covered under partial

rectification. Even though the complete rectification requires huge investment

it leads to significant energy savings and reduced line loadings. In the DPR

the option of replacement of exiting pump sets with energy efficient pump sets

along with the replacement of foot valves is considered.

5. The rating of energy efficient pump sets for the replacement of existing pumpsets is arrived at after analyzing the maximum possible head and current

water discharge requirement. With the help of pump set manufacturers each

pump set data is analyzed to propose energy efficient pump set along with its

efficiency value. The energy efficient pump sets are selected in a way so as tooperate in the range where the pump set efficiency curve is almost flat. As per

the pump manufacturers, the maximum variation in the efficiency of these new

pump sets will not be more than 3% to 4 %. The overall weighted average

operating efficiency for energy efficient pump sets is arrived at 48.9%.

However, to be on conservative side overall average operating efficiency for energy efficient pump sets is considered as 45 % (whereas that of non

standard pump set is only 28%) to estimate the energy saving potential by

replacement of all 2221 pump sets. The assumption of 45 % of overall

average operating efficiency which is 4 % less than the actual, provides

enough margin for the actual efficiency variation due to water level variations.

6. The overall average operating efficiency of 45% is used to arrive at revised

average input power rating for energy efficient pump sets. The energy savingpotential is estimated only for improvement in the system efficiency due to

replacement of existing pump sets with energy efficient pump sets. The detail

estimates of energy saving potential shows that the Overall consumption of existing pump sets is work out to be 15,617,923 units, where as with energy

efficient pump sets the consumption will go down to 9,487,825 units for same

average operating hours. This leads to the savings of 6,130,098 units i.e. 6.13

MU, The replacement of existing pump sets with energy efficient pump sets

would lead to energy saving.

The percentage energy saving is calculated based on estimates-

Percentage Energy Savings= [(Energy Consumption by Existing Pump sets –

Energy Consumption by Energy Efficient Pump Sets ) * 100]/(Energy

Consumption by Existing Pump sets)= 40%



Thus implementations of Ag DSM projects offer opportunity to reduce overall energy consumption, cut down energy bill to the farmers,reduces subsidy burdens on then distribution companies and state governments and mitigate the energy short situation while improving the water extraction efficiency. However for sustainable investment in

Ag DSM projects it is required to develop business models to assure sustainability of the savings for loan repayments and to provide adequate incentives to the investors.

MSEDCL utilizes a part of Load Management Charge (LMC) Fund collected

under a tariff regulation for replacement of old inefficient pumps with new

higher energy efficiency pump sets and contract out repair and maintenanceof pumps and certain aspects of project works to a project contractor

(DISCOM Mode).

7. With the above-noted background in mind and after taken in to account the

possible financing options, different business models have been developedand categorized as DISCOM Mode, ESCO Mode and HYBRID Mode as

described below,

MSEDCL utilizes a part of Load Management Charge (LMC) Fund collectedunder a tariff regulation for replacement of old inefficient pumps with new

higher energy efficiency pump sets and contract out repair and maintenance

of pumps and certain aspects of project works to a project contractor

(DISCOM Mode). (100% investment by the DISCOM)

An ESCO which has a contract with MSEDCL finances and implements the

project; the ESCO would borrow the project debt and repay it from project

revenues (ESCO Mode). (100% investment by the ESCO). In this modelbenefit savings to be retained by ESCO is 95%.

ESCO provides part of project funds through debt & equity and sign a contract

with MSEDCL, whereas part of the project fund would be contributed by

MSEDCL through LMC fund (HYBRID Mode). (67% investment by the

DISCOM, 33% investment by the ESCO). In this model benefit savings to be

retained by ESCO is 55%.

Since HVDS has not been implemented on the selected feeders, electricmotors may burn out frequently due to poor voltage profile. Therefore, the

risks involved for ESCOs/Project Contractors in the above discussed business

models (DISCOM Mode and ESCO Mode) are high, which may lead to low

participation from the interested bidders (ESCOs) for project implementation.

8. In order to motivate ESCOs to undertake the project, a hybrid solution has

been proposed in which MSEDCL will be required to contribute upfront a

portion of total investment from the LMC fund so that ESCOs and their

lenders‘ risks are minimized. This would be a significant amount and may bean important factor for an ESCO to get loan from the lender.

Monetary Savings/ Benefit to MSEDCL

1. The major benefit of pump set efficiency improvement is to farmers by way of

either increased water discharge output per unit of power consumed or samewater discharge with lower power consumption.



2. Replacement of existing pump sets with correctly selected, better designed

energy efficient pumps having higher efficiency for the same head range will

give same water output and consumes lesser power. Benefits to MSEDCLdue to lower power consumption by energy efficient agriculture pumps are

estimated for sale of energy to all consumers at an average cost of supply.

3. MSEDCL revenue billed per unit is used as a proxy to average tariff. Average

Cost of Supply for FY 08 is estimated from actual revenue from sale of power and actual energy sales to all consumers as provided comes out to be Rs

3.62 / kWh. Agricultural consumers are supplied at subsidized metered tariff

of Rs 1.10 per kWh whereas average power tariff is Rs 3.62 / kWh. Hence

MSEDCL is benefited due to reduction in agricultural energy consumption. Inaddition to this the revenue realization or collection efficiency from agricultural

consumers in Mangalvedha sub division is only 18 %, which also leads to

additional financial losses to MSEDCL, and could be avoided due to saved

energy. Thus the saved energy could be sold to other consumers at an

average rate of Rs. 3.62 per kWh (FY 08 Actual). The benefit analysis fromMSEDCL‘s perspectives, considering the benefits of sale of saved energy to

other consumers and reduction in financial losses pertaining to lower

collection efficiency from agricultural consumers is provided in Table 31

below. However, at conservative side the collection efficiency of 60 % is

assumed to estimate revenue collection loss due to saved energy.

As per calculations in the DPR the total investment needed for replacement of

2,221 existing pump sets will be Rs 432.8 Lakh, whereas MSEDCL‘s revenuefrom sale of saved energy to other consumers at Rs 3.62 / kWh is Rs. 221.91

Lakh. However there is reduction in MSEDCL‘s revenue at collection

efficiency of 60 %, due to reduction in energy sale to agricultural consumersdue to energy saved. At unit rate of Rs 1.10 /kWh for agricultural consumersand at collection efficiency of 60 % revenue from agricultural consumers

comes out to be Rs. 40.46 Lakh. In addition to this, to ensure sustainable

savings MSEDCL has to ensure proper R&M. The annual R&M cost is Rs

35.72 Lakhs, employee cost is Rs 6.6 Lakh and annual testing cost is Rs. 1.1Lakh. Thus the net annual benefit to MSEDCL is Rs. 138.02 Lakh. This work

out to be a simple payback period of 3 years.

PILOT AG-DSM PROJECT AT SOLAPUR

Based on these estimates, the detailed project financial analysis for a periodof 10 years is carried out for project implementation through ESCO Mode and

DISCOM Mode, whereas for HYBRID Mode financial analysis is carried out

for 5 years. The project cash flows and summary benefits for all the three

business models is provided in sections below.

1. The financial model indicates the economic viability for implementation of Ag

DSM pilot project through ESCO Mode with Project IRR of 19.21% for a

project cycle of 10 years(Simple payback Period – 5 years). Where as project

implementation through DISCOM Mode by MSEDCL utilising LMC fund,the Project IRR is 33.5% for a project cycle of 10 years (Simple Pay Back

Period – 3 years).



2. Implementation of project through HYBRID Mode, where ESCO invests 33% of

total investment (Rs. 4.33 Crores) and retains 55% of net savings, the

project IRR is 27.27% for ESCO where as for MSEDCL the project IRR is12.83% for a project cycle of 5 years (Simple Pay Back Period – 4 years).

3.

1 The cash flow statements over a ten year period for ESCO Mode & DISCOMMode business model have been worked out. Where as for HYBRID Mode

business model the cash flow statements are worked out for five year period .

4. For all the three business models, provision of tax on profits has been

considered at the rate of 33.99%. Project implementation through HYBRIDE

Mode business model provides a reasonable IRR of 27.27 % for ESCO &

12.83 % for DISCOM for project cycle period of five years. Where as for other business models the project cycle is 10 years. Hence HYBRIDE Mode business model indicate good financial viability and ensures minimum risk for project investors.

5. In the context of the agricultural DSM project, energy consumption in thebaseline and project scenarios and consequently energy savings can be

determined under two different approaches:

One is the project monitoring and verification (M&V) approachthat

determines energy savings based on monitored values of efficiency

parameters like head, flow and energy consumption.

Other approach uses standard values of pumping efficiency (baseline andproject pumps) and usage hours to arrive at energy savings called

the deemed savings approachContractually; ESCOs must stand behind

technical performance and specific efficiency of the systems and equipment

they install. These are key values in the M&V savings calculation. Other values in the savings equation, i.e., operating hours can be estimated using

baseline energy consumption data and then stipulated in the project contract.

In this way, the ESCO is not exposed to uncontrollable risks, but does

assume responsibility for system efficiency. The Discom and StateGovernment in effect, assume the uncontrollable risks. If the ESCO is paid

based on the agreed value of its capital investment and delivered services,

this formulation can produce equitable results.

For this reason, from the point of view of the ESCO and its lender, a Deemedsavings approach may be appropriate. This would involve pre- and post

performance demonstration of a sample of pumps by a third-party firm to

estimate savings per pump set basis. This information is then be used to

stipulate savings based on the operating hours estimated using baseline

energy consumption data for the entire project area. Periodic sampling of

pump set efficiencies during the course of the contract period is important to

account for any deterioration of savings and to confirm that the ESCO is

meeting its warranty obligations. Even if a Deemed savings approach is used

to determine payments to the ESCO, the Discom can implement a monitoring

and verification savings approach for all feeders and pump sets to gather the

most accurate information.

Carbon Credit Benefits



a. The responsibility of registering the pilot project for availing carbon credits

will be with the ESCO.

b. The ESCO shall prepare the Project Design Document and obtain required

approval from the United Nations Framework Convention on ClimateChange (UNFCCC).

c. All required and relevant data, technical support and necessary documents

will be provided to the ESCO by MSEDCL on a timely basis to support

the ESCO‘s application for carbon credit.

d. The benefits of carbon credits as applicable can be solely availed by the

ESCO.

Based on above DPR the MSEDCL invited RFP for implementing Ag DSM inthe state of Maharastra.

Proposed structure of the project

Hybrid Business Model has been proposed with AgIA (Agriculture

Implementing Agency) providing the initial capital investment through debt &equity, whereas MSEDCL would be providing the support through annualpayment from LMC fund and energy savings.( MSEDCL utilizes a part of Load

Management Charge (LMC) Fund collected under a tariff regulation for

replacement of old inefficient pumps with new higher energy efficiency pumpsets and contract out repair and maintenance of pumps and certain aspects of

project works to a project contractor (DISCOM Mode).

Brief Roles and Responsibilities of the AgIA

1. The AgIA shall be responsible for dismantling the existing pump sets, procurement of newEEPS. (Electricity Efficient Pumps)

2. Installation, maintenance and repair/replacement. AgIA shall also be responsible for financing, implementing and operating the Project. The AgIA shall procure EEPS and installthem with following minimum specifications:-

BEE Star rated Pump sets - 4star & above as per the existing availablemodels in the Market

Wide-voltage (should be operating at low voltage) Monoblock , open well submersibleand bore well Submersible pump sets.

The discharge rate of the EEPS shall not be lower than the existing pump sets of thefarmers.

EEPS installed shall be of the same type (Monoblock / Open well Submersible /Borewell Submersible) as the existing pump sets.

Low-friction foot valves conforming to relevant ISI Standard & specification and

3. The AgIA shall install EEPS with capacitor banks of relevant ratings as per the pump set

requirement.



4. Farmers shall be provided EEPS free of cost. They will also be provided with free installation

of the EEPS. The EEPS shall be procured with a minimum warranty of 12 months (1 year) by

pump set manufactures. The total R&M of 60 months shall be provided with no cost to the

farmers by the AgIA.

5. The AgIA shall dismantle the existing pumps and keep an inventory of old pumps (with proper

tagging of consumer ID) for one year. Disposal of old pumps should then be undertaken in a

manner that precludes their use or reinstallation in any form anywhere in India. The AgIA shall

provide a written assurance to MSEDCL describing the manner of disposal. MSEDCL shall

have the right to audit or hire a third-party auditor to confirm the appropriate disposal of all old

pumps. The disposal of old pumps shall be carried\ out in the following manner:

Photograph of old and new pump-set with consumer details shall be taken

Before disposal of old pump sets, a hole of appropriate size shall be made in

the pump set in the presence of Third Party Request for Proposal Ag DSM

Pilot Project MSEDCL

6. The term of the project shall be for a period of five years from the Effective Date of completion

of replacement of all the existing pumps with EEPS. The start date shall be when all EEPS

have been commissioned by AgIA.

7. The AgIA shall be responsible for dismantling the existing pump sets, planning the

procurement, installation and initial testing of new EEPS within six months from the date of

signing of the contract with MSEDCL.

8. A Third Party agency in the presence of AgIA and MSEDCL shall test all the existing pump

sets as well as the new EEPS at the time of replacement. The base-line and energy savings

for the first six months shall be estimated based on this initial testing & average annual hours

of operation of pump sets - 1640 Hrs (deemed savings approach).

9. For subsequent period of the project, a stratified random sampling technique shall be used to

select the pump sets to be tested. Stratification criteria shall be the type and the rating of the

pump sets. An estimated size of 10% of the total no. of pump sets shall be tested randomly

every year.

10. The sample pump sets shall be tested by Third Party in the presence of MSEDCL and AgIA

annually for demonstrating the savings. The pump sets shall be selected randomly every year

based on the approach mentioned in above clause.

11. This information is then be used to stipulate annual savings based on the estimate of the

average operating hours / annum (1640 Hrs) (Deemed Saving Approach)

12. Third party monitoring and verification agency could be a local NGO / Technical Institute etc.

Support given by MSEDCL

1. MSEDCL shall provide to the AgIA the data and support necessary for

implementing the tasks stated above.

2. MSEDCL shall install meters on all pump sets connected on five project

Feeders.

3. MSEDCL shall make payments on quarterly basis to the AgIA based on

―guaranteed savings demonstrated/achieved as per following-



a. Energy savings sharing %

The percentage sharing between MSEDCL andAgIA shall be as follow,

Draft Contract/Agreement Ag DSM Pilot Project

1. % retained with MSEDCL: .........70%.................

2. % shared with AgIA: ………30%………..

b. Base level energy consumption

Baseline energy consumption is estimated based on KW measured

at the motor input terminal of all the pumps prior to the replacement

of the existing Pump sets multiplied by operating hours of 1640 Hrs

per annum as specified in bidding documents / DPR. The baseline

established remains same for 5 years of the project. Energy

consumption by EEPS For first six months of the term - based on the

initial testing & average annual hours of operation of pump sets of

1640 Hrs. For subsequent period of the project – based on thetesting of sample of 10% of EEPS selected randomly every year &

average annual hours of operation of pump sets ofb1640 Hrs.

Quantum of energy saved or ―guaranteed annual energy savings‖

Base level energy consumption minus the Energy Consumption by

EEPS (Item no.5-Item no.6)

c. Periods for Demonstration of ―guaranteed annual energy savings

i. Initially, at the time of replacement of all the old pumps by EEPS

ii. After a period of six months from the start date of the project

iii. Then every year from the second demonstration for the balanced project period

d. Pricing of energy savings

i. "Energy savings shall be priced at Rs 2.70 / kWh for a project period of five years

4. MSEDCL shall ensure good power supply quality and load management

system in pilot area.

5. MSEDCL shall provide necessary support to the AgIA at the field level, as may

be required by AgIA from time to time, including, amongst others, regarding

access to consumer premises, replacement of existing pump sets, recoveringold pump sets and signing ownership agreement with the farmer/consumer.

Implementation of Ag DSM in Other States

About 50% of Indian populations are farmers. About 20% of the farmers have

electric pumps. Hence, only 10% of population directly benefit from

agricultural electricity use. Lack of perennial rivers made ground water tapping

a prerequisite in irrigation in south India. This has led to an increase in

consumption of electricity by agricultural sector. 73% of Indian populationdepends directly or indirectly on agriculture.. In most of the states, agricultural

consumption is un-metered. Consumers pay a flat rate tariff which is also



highly subsidized. As a result there is further wastage of electricity by using

sub standard pump sets.

On the basis of the DPR prepared by Mahrastra for implementing Ag DSM the

potential of energy saving is upto 40% and as per estimation of BEE Overall

electricity savings(from 20 million pumps) all over India is estimated at 62.1billion units annually.

Taking the case of state of Uttar Pradesh ( For the basis of calculation to

apply for all India for analysis purpose) based on the approved ARR, the

average cost of supply for FY 2009-10 works out to Rs. 4.17/kWh (Rs 17,791

cr/ 42,661 MUs). Thus earning by sale of this saved energy to other

consumers can be calculated as following-

ACS= Rs 4.17/unit

Cost of supply to Ag= Rs 1.10 /unit

Cost saving =4.17-1.10=Rs 3.07/unit

Total revenue earning by sale to other consumer = 62.1*10^9*3.07/10^7

= Rs.19065 Cr

For above saving the following investment shall be required towardsimplementing Ag DSM-

As per the DPR of Mahavitran for connected pumping load of 9523 kW

investment required = Rs 583.2 Lakh

Taking the above to be true for India scenario the investment required may be

to the tune of 1,00,000 Cr.

In case the project is implemented through an ESCO mode, the energysavings would be shared between ESCO and Discom. Assuming 95% of the

proposed energy savings is shared with ESCO for 10 years. The financial

model indicates the economic viability for implementation of Ag DSM pilot

project throughESCO Mode with Project IRR of 19.21% for a project cycle of

10 years(Simple payback Period – 5 years). With CDM Benefits taken in to

account the project IRR improves to 22.8%.

posted by srijan at 7:51 am 1 comment: links to this post

An energy crisis could choke growth

Over the last two decades, growth








http://www.electricityinindia.com/2011/03/agriculture-demand-side-management-ag.html#links










in domestic energy production has

failed to keep pace with India’s

exploding energy needs. As a result

of inadequate mining and refinery

capacity, India has yet to unleash

the full potential of its domestic

coal endowment –the third largest

in the world –and it’s estimated

that insufficient coal production

continued to contribute to a third

of the country’s total power deficit

over the last fiscal year

4

. But India’s

energy challenges are not limited to

production shortfalls. Poor distribution

infrastructure also constrains supplyside growth. Not only does India lack

the infrastructural capacity to deliver

more energy to meet rising demand,

inefficiencies in existing distribution

infrastructure has resulted in an

average of 30 percent energy loss

during transmission and distribution –

one of the highest rates in the world

5

.

The demand-side picture is not



much better, with India’s industrial

sector –one of the world’s most

energy-intensive –continuing to

push domestic energy consumption

upward (industrial output contributes

to 16 percent of India’s GDP while

consuming 45 percent of commercial

energy). The result is a rapidly

yawning gap between domestic

energy supply and demand that is

being filled by increasing energy

imports (the annual value of oil

imports alone is expected to rise

nearly 18 percent in 2012)

6

.

In 2012, weakness in the rupee (the

rupee depreciated almost 20 percent

against the US dollar in the last five

months of 2011) will magnify the

negative impact of foreign energy

dependence on business risk and

profits in India

7

. Though depressed

global consumption may lead to a

slight moderation of global energy



prices, the rupee’s weakness is likely

to result in a price hike on energy

imports and a higher debt service

burden in rupee terms that would

squeeze domestic profit margins

in 2012

8

.

Curbing energy prices and India’s

dependence on energy imports

requires policy support and reform

to address the country’s supply-side

energy shortcomings. To this end,

the government needs to accelerate

the overhaul in the country’s energy

distribution infrastructure with

investment in technologies such as

the smart grids while supporting the

expansion of new alternative energy

sources. The National Solar Mission

(which aims to generate 20,000 MW

of solar power by 2020) and the

National Mission on Enhanced Energy

Efficiency (which has targeted to

deliver annual fuel savings of about

23 million tons oil equivalent) offer

hope if implementation and funding



improve in 2012.

Business implications:

• Invest in energy saving technologies

and processes and develop

alternative sources of energy supply

• Diversify sources of supply by

forging strategic alliances and key

partnerships with suppliers and to

secure resource supply in the

long term

• Utilize free trade agreements

as a platform to cost-effectively

source clean and smarter

energy technologies

• Shape pro-growth approaches

to regulation by working c

INTRODUCTION TO ENERGY CRISIS

Imagine this scenario: One morning you wake up, yawn, scratch yourself, and sit up. Wearily, you

stumble out of bed. You go to your refrigerator for a glass of milk only to discover that the light inside

does not turn on and everything inside it has been sitting at room temperature overnight and is quickly

beginning to spoil. "That's funny, "you think to yourself. When you try to brew a cup of coffee the coffee

maker does not seem to want to start. Your gas stove won't turn on, so it looks like there'll be no bacon

and eggs this morning. As you sit down with your bowl of dry cereal, you glance out the window and

wonder why there is no newspaper. You pick up your cordless phone to call the newspaper and

complain, but it doesn't turn on either. You begin to panic and you run out to the car. It won't start."What's going on?" you think to yourself. "Why doesn't anything work?"

Does this sound like the beginning to some strange science fiction novel? Well, the scenario we just

illustrated could be very real indeed. Together, fossil fuels (coal, petroleum, natural gas, and their

derivatives) provide more than 85% of the energy used by mankind today. Unfortunately, the reserves

of those fuels are not infinite. Scientists predict that within the next two centuries we will run out of

those valuable energy sources. This is you experience energy crisis. Clearly, something must be done.

But what?

Before the Industrial Revolution of the 1890s, human beings had only a moderate need for energy. Man

mostly relied on the energy from brute animal strength to do work. Man first learn to control fire around

1 million BC. Man has used fire to cook food and to warm his shelters ever since. Fire also served as

protection against animals. Thousands of years ago, human beings also learned how to use wind as an

energy source. Wind is produced by an uneven heating by the sun on the surface of the earth because of

the different specific heats of land and water. Hot air has lower pressure than cold air and since high

pressure tries to equalize with low pressure the current called wind is produced. Around 1200 BC, in



Polynesia, people learned to use this wind energy as a propulsive force for their boats by using a sail.

About 5 thousand years ago, magnetic energy was discovered in China. Magnetic force pulled iron

objects and it also provided useful information to navigators since it always pointed North because of the

Earth's magnetic field. Electric energy was discovered by a Greek philosopher named Thales, about 2500

years ago. Thales found that, when rubbing fur against a piece of amber, a static force that would

attract dust and other particles to the amber was produced which now we know as the "electrostatic

force". Around 1000 BC, the Chinese found coal and started using it as a fuel.An energy crisis is any great shortfall (or price rise) in the supply of energy resources to an economy. It

usually refers to the shortage of oil and additionally to electricity or other natural resources.

The crisis often has effects on the rest of the economy, with many recessions being caused by an energy

crisis in some form. In particular, the production costs of electricity rise, which raises manufacturing

costs.

For the consumer, the price of gasoline (petrol) and diesel for cars and other vehicles rises, leading to

reduced consumer confidence and spending, higher transportation costs and general price rising.

Webster defines crisis as a “decisive moment “or “turning point”. We are now at an extremely critical

stage of using energy beyond a practical limit. We have increased our usage enormously, especially oil,

in the past decade. The consequence is we are quickly exhausting our finite supplies of oil and natural

gas. As a result, we are becoming more dependent on foreign sources of oil to keep our country

functioning. In 1977 the United States with only 6 percent of the world‟s population consumed

approximately 30 percent of the energy produced in the world. These statistics are startling reminders of

our insatiable energy appetite. Some people may ask “do we have an energy crisis”. The answer is a

definite yes. Our next step is to realize we are at a crucial time if we are to reverse our terrible trip

towards energy starvation. We will have to recognize our mounting trouble and act decisively to stem

the tide.

About 60% of all the energy used in the world today comes from burning oil and natural gas. Despite

massive exploration program, very few large outfields have been found in recent years. This could well

mean that most of the world's oil has been already discovered, and that, in the future oil can be run out

faster than anticipated. Today, the world is producing enough oil to meet its present needs. If only wecould use oil at its present rate then world's reverse could last for over 100 years. Unfortunately world's

energy demand has been growing steadily over the past 50 years, and most experts believe that this

trend will continue. No one can exactly tell that how much the energy will cost in the future and no one

can exactly tell that how much the energy will needed in the future. The problem about the world's

future energy supplies is called the world‟s energy crisis.

TYPES OF ENERGY CRISIS

1. NUCLEAR POWER



Even in the heady days of the 1950s, problems with nuclear power were beginning to arise. For one,

early nuclear technologies were developed in a sort of hothouse that was insulated from commercial

realities. When these technologies were transferred to civilian power sectors, they could not compete

economically with conventional power sources. However, the equipment manufacturers and utilities

believed that additional experience would bring decreases in cost.

One of the main sources of opposition to nuclear power was based on the assumption that it wasinherently unsafe. Many engineers argued that the plants were safe, and that built-in safety features

could prevent and had prevented accidents. The possibility of accidents caused mainly by operator errors

had been repeatedly. The immediate result was long lines at gas pumps, high heating bills, and a

worldwide economic downturn.

Many power utilities had acted in the postwar period as Promoters of increased electric usage among

consumers, through publicity campaigns and the direct sale of electric appliances.

2. HYDROELECTRIC POWER

Man has utilized the power of water for years. Much of the growth of early colonial American industry

can be attributed to hydropower. Because fuel such as coal and wood were not readily available to

inland cities, American settlers were forced to turn to other alternatives. Falling water was ideal for

powering sawmills and grist mills.

As coal became a better-developed source of fuel, however, the importance of hydropower decreased.

When canals began to be built off of the Mississippi River, inland cities became linked to mainstream

commerce. This opened the flow of coal to most areas of America, dealing the final blow to hydropower

in early America.

Water power really didn't stage a major comeback until the 20th century. The development of an electric

generator helped increase hydropower's importance. In the mid-20th century, as Americans began to

move out of the cities and into "suburbia," the demand for electricity increased, as did the role of

hydroelectricity. Hydroelectric power plants were built near large cities to supplement power production.

The problems included frequent floods, erosion, and deforestation. The TVA provided for the building of

several hydroelectric dams. Not only were the dams successful in controlling the flooding, they also

provide electricity to the region. The TVA is an example of successful implementation of hydroelectric

power.

3. FUEL CELLS

The fuel cell is one example of a government-sponsored technology which has, after several decades of research and development effort, produced a viable technology. The fuel cell is a chemical method of

producing electricity, somewhat analogous to an ordinary battery. The difference is that the fuel cell

must be continuously supplied with chemical reagents in order to function. It does not hold a charge like

a battery. The fuel cell derives current from a chemical reaction using oxygen from air and hydrogen

from a fuel source (usually petroleum, synthetic fuels derived from coal, or natural gas, but renewable

fuels such as methanol have been tried).

In operation, fuel cells are silent and produce only water and carbon dioxide as waste products. The

electrochemical process used in a fuel cell was discovered in the early 19th century, although it was not

proposed for commercial purposes until the 1930s. In the 1950s, Westinghouse Electric developed

commercial versions of these devices, but found only niche markets for them. In the 1960s, fuel cells

designed for NASA provided power for the Apollo spacecraft. Early NASA fuel cells supplied by General

Electric Company used an unusual electrolyte composed of a polymer material in the form of a

membrane. The resulting fuel cells were quite expensive. By the 1990s, fuel cells using less expensive

materials and solid fuels were available and put into operation experimentally as part of utility company

power networks. Unfortunately, the U.S. Department of Energy has had difficulty transferring the

financial responsibility for commercializing this technology to the private sector. Additionally, many

utilities remain unconvinced that fuel cells represent an economical alternative to other medium-scale

power sources, especially gas turbines leading to energy crisis.

4. SOLAR POWER

The history of solar energy conversion is another example of a technology that is inextricably linked to

government policy and financial support. While solar cells were developed by the 1950s which could

generate enough electricity directly from sunlight to operate electronic circuits, the amount of current

was small and the price was high.Nonetheless, solar cells found niche applications by the 1960s. The most famous application was in



space: from the 1960s on, many satellites were powered by solar cells.

A second important application was developed by telephone companies to operate remote repeaters and

other equipment. Solar cells remained inefficient and expensive compared to other methods, and were

suitable only where no other energy source could be used or where cost was not a major consideration.

Solar power for utility applications was given a temporary boost through the government funding of applied research on solar cells and the construction of experimental solar stations. Not all of these solar

stations used solar cells; several large systems used computer-controlled, movable mirrors to focus light

on a boiler, which produced steam to drive a turbine. However, these large-scale plants remained

experimental, and funding eventually dried up.

5. WIND POWER

By far the most successful alternative energy technology has been the exploitation of wind. This form of

small- to medium-scale generation was repeatedly passed over by American utility companies before the

1970s because it was considered unreliable and unsuitable for large scale exploitation. But in time, due

to changes both in the technology and in the business environment, wind power became a part of

established electrical networks.

The use of wind energy to serve various industrial purposes is quite old, dating at least to the 12th

century. Unlike other power sources such as water or steam, wind power was for the most part left

behind in the late 19th century by electric companies looking for ways to drive generators. It was seen

as unreliable and unavailable in sufficient quantities to power larger machines. The energy crisis of the

early 1970s revived interest in wind-powered electric generation, and a number of European firms

quickly moved to the forefront in providing updated versions of this ancient technology. Early emphasis

in America was on the development of multi-megawatt wind turbines, although such designs did not see

much commercial success.

The turning point for alternative energy utilization in the United States, including wind power

technology, was national legislation which in 1978 forced utilities to purchase the power generated by

independent producers. This act, called the Public Utilities Regulatory Policies Act (PURPA), was intended

to advance deregulation in the industry, but also to encourage experimentation with new energy

technologies.

Others:• Biomass

• Geothermal

• Fusion

6. OIL CRISIS

The world at large and India in particular have moved towards a serious energy crisis in the 1980s .Of

occurs this crisis first cropped up the 70s when the open countries suddenly raised the priories of oil

.The oil price like was coupled with the inefficient supply of conventional flues and the rapid rise in the

demand of energy. While the demand of energy has significantly increased due to rapid industrialization

urbanization transportation and communication development modernization of agriculture and due to

heavy population pressure; the supply position has deteriorated owing to heavy depletion of fissile fuel

reserves and to technological inefficiencies associated with exportation of those reserves. Hence now we

find and unabridged gap between demand and of conventional fuel, which is in, turn worsening the

energy crisis. Though there is turn stability in the oil market at the moment it is deceptive.

World Crude Oil Prices

$ Per barrel

September ‟90 39.00

November ‟98 10.00

March ‟00 34.13

December ‟02 27.86

July ‟04 48.00

October ‟04 55.57

January ‟05 42.55

June 52.48

July 60.70August 67.00



March 1st „06 61.68

10th 60.73

31 66.57

April 3rd 67.19

17th 70.00

May 3rd 74.99

7. THE DEVELOPMENT OF ALTERNATIVE ENERGY SOURCES

Nuclear power remained the only widely utilized, radically new generating technology from 1945 through

the 1960s, but many other new sources of electricity waited in the wings. The Cold War and the

resulting peacetime buildup of military might indirectly spawned not only nuclear energy, but also all

sorts of energy-related research projects. Especially important in the long term were smaller-scale

generating technologies, such as the solar panels used to provide power to satellites and other small

pieces of electronic equipment. But it was the oil crisis that brought several formerly military or space-

related energy technologies into the public light and made energy research part of the agenda of

national governments worldwide.

The year 1973, which saw a dramatic but short-lived jump in oil prices, marked a real turning point for

electric power technologies.

Many power utilities had acted in the postwar period as promoters of increased electric usage among

consumers, through publicity campaigns and the direct sale of electric appliances.

On the production side, there were widespread calls for greater efficiency and the development of new

fuel sources, including a return to coal, which had fallen out of favor as a boiler fuel by 1945.

Similarly, some industries began burning waste products (such as wood chips in paper manufacturing) to

generate electricity locally.

The fuel, environmental, and regulatory crises that power utilities countries experienced were not

without their counterparts in other nations. In Russia and China, for example, fluctuations in fuel prices

and the world economy drastically affected electrification programs. Where nuclear power seemed to be

a key to future power production, it soon became evident that economical operation of nuclear plants

remained problematical. Developing countries experienced economy wide setbacks during the oil crises,

which retarded the growth of electric power industries.

Western governments in the 1970s began pouring money into research and development efforts aimed

at improving alternative energy sources and ending dependency on foreign oil. These programsexperienced periodic cutbacks, and some were failures, but several resulted in technologies which are

now widely used.

Another interesting proposal was the use of storage batteries to “bottle” excess electricity generated

during off-peak hours for use during periods of heavier load. Late 19th century dc power systems in the

United States and Europe had sometimes used storage batteries for such purposes, but this system did

not work with ac power. Battery storage survived in specialized applications, however. Telephone

systems use battery storage to provide an extremely reliable source of energy to run

telecommunications networks worldwide. The improvement of electronic ac-dc converters after 1945

revived interest in storage batteries, and one line of inquiry investigated the use of a new type of

lithium-sulfur cell for this purpose.



HOW WE GOT WHERE WE ARE TODAY?

In the aftermath of the 1973 and 1979 energy crises, which were arguably precipitated by international

political actions that upset time-honored economic relationships, oil prices trended downward in real

terms, and the public was lulled into complacency. Sure, they had to pay more for a gallon of gasoline,

but at least they could obtain it readily without waiting in the lines seen during the crises.

Producers of natural gas began to explore for gas in newer areas, often at higher cost than production in

more traditional areas. Simultaneously, new technologies for the use of gas improved the efficiency of

gas use. Environmental concerns increased interest in the use of gas, based on that fuel's "clean" image

and its largely invisible delivery system.

As gas became more popular and gas utilization became more efficient economically, electric utilities

turned increasingly to gas as a fuel for power generation. New, highly efficient gas turbines were

developed by major turbine manufacturers, and gas increased its penetration of the power generation

market steadily.

In the winter of 2000-2001, a number of factors have come together to magnify the problems facing the

energy industries. Among these are a rapid increase in demand for energy commodities, a not-so-rapid

increase in production of energy from new sources (given the lead times needed to develop new

production), a rapid rise in the price of natural gas and petroleum (and a coming rapid escalation of

residential consumer bills), a rapid and continuing increase in the popularity of new gas-fired electric

power generating facilities, and a rapid proliferation of environmental rules affecting the use of some

energy commodities and the relative importance of others.

This combination of ingredients sets the stage for the next energy crisis. This winter has already seen

critical shortages of electric power, followed by the first-ever Federal intervention to essentially force

utilities to continue supplying energy even if they lose money by doing so. The Golden State's three

major electric utilities have moved close to the edge of bankruptcy, caught between extraordinarily high

costs and slow reaction by state regulators to the incipient crisis.

Meanwhile, the costs of natural gas on the spot market have risen to record levels, just as more electricgenerators, both traditional utilities and newer independent power producers, turn increasingly to gas as

a generating fuel.

CAUSES OF HISTORICAL CRISES

1973 oil crisis

Cause: an OPEC oil export embargo by many of the major Arab oil-producing states, in response to

western support of Israel during the Yom Kippur War.



1979 energy crisis

Cause: the Iranian revolution

1990 spike in the price of oil

Cause: the Gulf War

California electricity crisisCause: failed deregulation, and business corruption.

UK fuel protest (of 2000)

Cause: Rise in the price of crude oil combined with already high taxation on road fuel in the UK.

Oil price increases of 2004-2006

Cause: Tight supply margins in the face of increasing demand, partly from China's demand.

Power shortages

Cutbacks in conservations.

Cutbacks in renewables.

Power plant outages.

OUR COMMENTS FOR SAVINGS IN ENERGY

These types of energy are constantly being renewed or restored. But many of the other forms of energy

we use in our homes and cars are not being replenished. Fossil fuels took millions of years to create.

They cannot be made over night. And there are finite or limited amounts of these non-renewable energy

sources. That means they cannot be renewed or replenished. Once they are gone they cannot be used

again. So, we must all do our part in saving as much energy as we can.

IN HOME:In the home, energy can be saved by turning off appliances, TVs and radios that are not being used,

watched or listened to. The lights should be turned off when no one is in the room. By putting insulation

in walls and attics, the amount of energy it takes to heat or cool our homes can be reduced. Insulating a

home is like putting on a sweater or jacket when we're cold...instead of turning up the heat. The outer

layers trap the heat inside, keeping it nice and warm.

RECYCLING:

To make all of our newspapers, aluminum cans, plastic bottles and other goods takes lots of energy.

Recycling these items -- grinding them up and reusing the material again -- uses less energy than it

takes to make them from brand new, raw material. So, we must all recycle as much as we can.

TAKING CARE OF CARS AND TRUCKS

We can also save energy in our cars and trucks. Make sure the tires are properly inflated. A car that is

tuned up, has clean air and oil filters, and is running right will use less gasoline. Don't over-load a car.

For every extra 100 pounds, one should cut mileage by one mile per gallon. When your parents buy a

new car, tell them to compare. The fuel efficiency of different models and buys a car that gets higher

miles per gallon.

IN THE COLLEGE

Energy can be saved in the college. Each week one can choose an energy monitor who will make sure

energy is being used properly. The energy monitor will turn off the lights during break time and after

class. "Turn It Off" signs should be made for hanging above the light switches as a reminder.

Energy Patrol can be started in the college. One can make sure whether their classmates recycle all

aluminum cans and plastic bottles, and make sure the library is recycling the newspapers and the

college is recycling its paper.

POWER GENERATION FACILITIES



New power generation facilities, principally gas-fired combustion turbines and combined-cycle units

making more efficient use of gas, can be constructed more quickly than large-scale centralized power

plants, but even they take as long as two years to site, obtain required permits, and build connecting

transmission lines. And that assumes that the state regulatory commissions involved recognize the need

for new construction and act favorably and expeditiously.

NEW TECHNOLOGIESDevelopment of new generation technologies to improve the utilization of energy has improved, but

incrementally, with dramatic new efficiencies unlikely in the immediate future. The prospects for getting

"more bang for the buck" are good in the long term, but not in the near term.

By 2020 we could be dependent on imported energy for three-quarters of our total primary energy

needs ... we may become potentially more vulnerable to price fluctuations and interruptions to supply

caused by regulatory failures, political instability or conflict in other parts of the world.

SOLUTIONS FOR ENERGY CRISIS

1. DRILL DOMESTICALLY WHEREVER WE CAN TO PRODUCE MORE OIL

● Firstly, corral the environmentalists, and drill for oil on land we own, and control, where we KNOW

there is oil. (Florida's west coast).

● As to our energy future, while innovation from new technology will take care of the long-term problem,

the short term must be dealt with by ignoring environmentalists and moving ahead with drilling in

Alaska as well as the various U.S. coasts where it is prohibited.

● There are vast amounts of oil (actually, bitumen, a precursor of oil) in oil shale in the United States,

and new technology (exists) for extracting it with minimal environmental effects.

2. HYDROGEN: THE FUEL OF THE FUTURE

● Build a national network of hydrogen refueling stations (hydrogen gas stations). This should be easy.

After all, Eisenhower was able to build the interstate highway system in the 1950s and 60s, which seems

like a much more complex task.

● The plan to see being the best is hydrogen with water being the exhaust from the vehicles. With the

use of solar panels, we can generate the hydrogen free… well, almost free… but without the need of oil. ● Some of BMW's new 2008 luxury cars will have the ability to run on hydrogen. Keep in mind that these

are not fuel cells. Rather, these are conventional internal combustion engines that have been modified to

burn hydrogen or (and this is key) gasoline. Since the hydrogen infrastructure is very spotty, these

vehicles can use gasoline at the flick of a switch when hydrogen is not available.

3. ETHANOL -- IF THE BRAZILIANS CAN DO IT, WHY CAN'T WE?

● Brazil runs over 50% of its vehicles on ethanol. Ethanol can come from many sources. The production

plants are being built now. (One in my home state of Georgia is purported to be producing ethanol from

trees)

● Get sugar cane fields growing. Sugar cane requires less fertilizer than corn and is easier to make

ethanol out of.

● Turn lawn grass, America's largest crop, into ethanol.

● There is no reason that ethanol cannot be our primary fuel. A gradual increase of ethanol/gasoline

mixtures at the pump until the standard fuel is 80%-90% alcohol can be a real possibility within the next

8 to 10 years if someone would actually get it rolling now.

4. BIODIESEL -- PROVEN POWER FROM GARBAGE

● Why not use every bit of waste, i.e., paper sludge; slash piles, veggie by-products (carrot tops, potato

skins, beet peelings, etc.) to make more fuel?

● Biodiesel can provide a major new energy source. If it is made with non-food crops, the yield is far

higher than with soybeans.

● All we really need is car companies to increase the number of cars with diesel engines. … The second

part of this has to be biodiesel stations. Biodiesel fuel can easily be made at home, and it can be made

from used vegetable oil. Currently someone who makes their own biodiesel 40-50 gallons at a time at a

cost of $0.69 a gallon.

● Biodiesel -- There is no reason, other than distribution, why every ship, train, semi-truck, tractor, orpiece of construction equipment with a diesel engine should be burning straight (petroleum-based)



diesel.

5. SOLAR ENERGY COULD DO THE JOB JUST BY ITSELF

● The United States has thousands of miles of desert and plains that receive enormous amounts of

sunlight every day, often even in winter. It has been said that approximately 100 square miles of solar

panels or a modest multiple thereof (5-10X) could generate enough electricity to accommodate virtually

all of the electric energy needs to the country.

● In Las Vegas the amount of solar energy there is amazing. We could make it mandatory that all newhouses have solar roof tiles instead of regular tiles and give tax credits if people replace their tiles with

solar tiles on their existing homes.

● Solar panels in the southern states, especially Florida and the like, could easily be used to run all the

electricity a house needs. Furthermore, having lived in Florida, it's so sunny that the excess electricity

could either be sold back to the electric companies or the solar package could come with a power supply

to use in charging an electric-powered vehicle.

6. LETTING IN THE RIGHT AMOUNT OF SUN

In a cold climate we welcome the sun's heat and light most of the time. And once we capture the heat,

we don't want to give it up. In a warm climate, we don't want the heat, but we do want the light.

Advances in window technology let us have it both ways.

Less than half of the sun's energy is visible. Longer wavelengths--beyond the red part of the visible

spectrum--are infrared, which is felt as heat. Shorter wavelengths, beyond purple, are ultraviolet (UV).

When the sun's energy strikes a window, visible light, heat and UV are either reflected, absorbed or

transmitted into the building.

7. DEVELOP WIND, SOLAR ENERGY TO MEET POWER CRISIS

Alternative sources like wind and solar energy need to be developed to tide over the power crisis in rural

India. To meet the power crisis of rural India, there is a desperate need to develop wind and solar

energy for power generation. Commenting on the sick Public Sector Units, Centre had planned to make

25 sick units "economically viable" by bailing them out of crisis this fiscal.

We have seen improvements after these units to increase their profitability or they would be shut down

just the way we had closed two sick units in the recent past.

8. AS A WHOLE, ENERGY CRISIS

Conservation is not the total Answer, but it would certainly improve our situation. This would have to be

a conservation program that would encompass all of our consumers. The initial step would be less

driving and more use of mass transportation system. In some parts of the country it would mean adding

more buses and trains, in other parts, it would be modernizing the existing systems. Also it would

include an educational program for the energy consumers to make them aware of how they can save

energy daily. This has already begun and hopefully it will continue.

In addition, the new car manufacturers will have to increase the fuel efficiency of all cars. Another

solution will concern the industrial sector of our economy, to continue their cutbacks and their fuel

efficiency programs without seriously affecting their production.

LONG TERM / FUTURE SOLUTIONS

India needs approximately 100000MW of additional power by 2010 if it is to embark on a high growth

trajectory and emerge as an economic giant by 2020.However, most projections state that at the

current rate of capacity addition we will fall well short of achieving this target.

To address this problem, it helps in understanding the issues involved, there are primarily three of them

they are:1. Finance



2. Technology

3. Structure of the power grid

FINANCE

As there is a glut of capital in the international markets to the tune of around USD 2 trillion, the power

market in India is one of the few areas in which a part of this can be invested with the prospect of

assured returns for investors (hopefully the government can facilitate this by giving counter-guarantees)

.In addition, we need to move towards a public-private model where the government provides the gridand charges the private sector to use it and privatize the distribution and generation of energy and give

them tax breaks or exemptions to pay for politically desirable (read unprofitable) ventures like

subsidized power for farmers.

TECHNOLOGY

There are 3 technologies which are uniquely suited to the Indian market

1) GAS BASED POWER GENERATION

Gas based power plants are ideal for India as we have recently discovered vast gas reserves in the

Krishna-Godavari basin and other locations. In addition, Russia a non-OPEC Country and currently the

world‟s second largest oil producer in addition to being a long standing ally of India currently has about

50% of the world‟s proven gas reserves, thus, shielding us against any unforeseen price fluctuations like

has been seen in the case of oil due to rising tensions in the middle east.

2) NUCLEAR POWER GENERATION

Nuclear power has a vast potential to fulfill our energy needs. Each nuclear generator generally produces

around 1000MW of power and doesn‟t need to be refueled between 5-10 years (depending on the

design). In addition, it produces no green house gases (one of the reasons the French are „holier than

thou‟ on the Kyoto treaty is because they get 75% of their energy needs from nuclear power).

The problem, of course, is the NPT which prevents companies like France‟s Avera or America‟s GE to

build and/or operate Nuclear power plants in India.

However, the Ministry of Atomic Energy, Russia has a holding company MINATOM which is eager not

only to build power plants in India (which it is already doing) but, for a price, is willing to transfer it to

BHEL and others so that we wouldn‟t be dependant on anyone for building and operating our power

plants. Now these are water-cooled nuclear power plants which are as safe as any in the West at a

fraction of the price not the Sodium cooled ones on which Chernobyl was based so we shouldn‟t beunduly worried about unsafe nuclear power in our backyards. As for the fuel the Russians have some

500 tonnes of U-235 (the byproduct of the former USSR‟s arms buildup) which could be effectively used

for this.

3) HYDROELECTRIC

This is the cheapest source of power but causes massive environmental problems like soil erosion and

takes a long time to build, typically 10 years, without any litigation from the likes of Mrs. Medha Patkar

& Arundhati Roy. However, once a study has conclusively proved the feasibility of a project if should be

brought under an act which makes it immune to frivolous litigation.

4) STRUCTURE OF THE POWER GRID

We, like, most other nations have a unidirectional power grid i.e. one way flow of electricity from the

supplier to the consumer however in India most business houses have captive power generation due to

the lack of reliable power, why not further encourage them to ramp up their captive power production

and let them put the surplus for sale on the power grid? This will lead to reduced prices of power for the

enterprise (economies of scale) and more power to our booming economy.

The most logical today are atomic power by fusion, solar power, reusing waste, and further development

of synthetic fuels.

The atomic fusion power would be a great source if we were able to use hydrogen from the oceans as its

source. There are numerous dangers that would have to be ironed out. And last, possibly the same

Yankee ingenuity that has made this country flourish could take another step for mankind and came up

with some entirely new and effective source of energy.



RECENT CASES OF ENERGY CRISIS

1. INDIA FACES MAJOR ENERGY CRISIS DUE TO CRUDE OIL REFINING CAPACITY AND COMPLIANCE TO

ENVIRONMENTAL CLEAN UP STANDARDS

India faces more problems that just need for reliable energy supply. Even if the Government is able to

acquire rights to Natural gas and Crude oil supplies all around the world, the problem does not end

there.

India faces a major shortage of refining capacity. As a result prices of diesel, Petrol and Kerosene can go

through the roof even if the Crude oil price moves up slowly.

The refineries all around India are old and mainly acquired from the Soviet Union many tears back. They

need to be replaced soon. They operate at a much lower capacity die to maintenance needs and cause

bad pollution all around. The refinery owned and operated by Reliance is the only one in the country that

is of world class standard and is sophisticated. It was operational approximately 22 months back and is

based on most advanced technologies in the world.

The rest of the 18 refineries are in hopeless condition. Some of those India‟s refineries cannot get rid of

the high sulphur content to produce what is internationally known as sweet crude. Many of the refineries

cannot effectively extract Kerosene through the secondary process, Kerosene is high demand since it

lights up many homes sin India.

Seven of these prehistoric 18 refineries can be modernized. But red tape and lack of operational control

is taking the country to the brink of a major energy crisis.

Raghunath Mashelkar, scientific adviser to the government recently submitted a report on the status of

the refineries to the Government. India‟s 115m-tonne refining capacity needs some major capital

investment, the report clearly mentions about the need of “substantial capital funding” to upgrade or

overhaul processes to meet global standards on quality petrol and diesel fuels.India needs US $6.5 Billion to upgrade these refineries to meet the Euro IV standard of emission by

2010. Stepping up to Euro III emission standards will also require hardship as required by next April.

According to the New Delhi-based Energy and Resources Institute (Teri), fiscal incentives are required

from the Government to move forward towards this capital investment.

2. ENERGY CRISIS FORCES INDIA TO FOCUS ON „SHIFTING THE EMPHASIS FROM PERSONAL

TRANSPORT TO PUBLIC TRANSPORT‟

India has given its go-ahead to Metro Rail projects for Mumbai, Hyderabad and Bangalore and would

provide viability gap funding for the projects in various states, Union Minister for Urban Development

Jaipal Reddy said on Friday.

The choice of deciding about the nature of gauge to be adopted in the metro rail projects has been given

to state governments, Reddy said.

In his inaugural address at ''Cityscapes 2006'', a meet on Urban infrastructure reforms with public-

private linkages, being organized by the FICCI, Reddy said metro rail projects in Hyderabad, Mumbai

and Bangalore can take off immediately.

The project proposals were pending; following the stand of Indian Railways that broad gauge should beadopted for Metro Rail projects, while many state governments preferred standard gauge.--------------

energy crisis in ndia

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