Electricity Act 2003 -Sjvnl140509

7/31/2019 Electricity Act 2003 -Sjvnl140509

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Introduction to Electricity Act 2003

Presented By

Indu Maheshwari

Dy. Director


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Jun 5, 2012 POWERGRID - NRLDC 3

SpatialDistribution Of

Load

Source:Powerline

(Siemens Ad),

Oct-2006


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680 720 760 880 920 960800 84 0

SS

WW

NN

EE

NE

B

DESH-

SRI

NEPALBHUTAN

82.5 0

J&K

HPPUNJAB

HARIANA

RAJASTHAN UP

MP

BIHAR

ORISSA

WBLGUJARAT

MAHARASHTR

A

KARNATAKA

TAMILNADU

AP

ASSAM

MNP

MIZTRP

NG

ME

LAKSHADWEEP

A&N

MYANMAR

SKM

PONDICHERY

DELHI

GOA

DIU

DAMAN

NERNER

LANKA

JKND

CTGR

Diversity

Time

GenerationResources

Load Centers

Long Haulage ofPower

Weather

Seasons


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Jun 5, 2012 POWERGRID - NRLDC 6

Typical Seasonal Load CurvesFor Northern Region


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11111

11111

11111

11111

11111

11111

11111

11111

1 1 1 1 1 1 1 1 1 11 11 11 11 11 11 11 11 11 11 11 11 11 11 1

WINTER

MONSOON

SUMMER

EVENING

PEAK

Typical Seasonal Load Curves ForSouthern Region


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Regional Grids Geographical

30,500 MW

16,00052132 MW

39280MW

48554 MW

25272

MW

2147MW

Installed Generation Capacity

Current: 187549.62 MW(Feb 29)

Target for Year 2012: 200,000 MW

Figures as on 29Feb 2012

Inter regional LinkInter regional Link MW capacityMW capacity


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Peculiarities of Regional Grids in India

NORTH-

EASTERN

REGION

REGIONALGRIDS

Deficit Region

Snow fed run-of the riverhydro

Highly weather sensitive load

Adverse weather conditions:Fog & Dust StormVery low load

High hydro potential

Evacuation problems

Industrial load and agriculturalload

Low load

High coal reserves

Pit head base load plants

High load (40% agriculturalload)

Monsoon dependent hydro

CHICKEN-NECK


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N-E-W Grid

SOUTH Grid

SOUTHERN

REGION

WESTERNRE

GION

EASTERN

REGION

NORTHERN

REGION

NORTH-

EASTERN

REGION

1

2

TheElectrical

Regions


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International Connections

Bhutan Tala HEP (1020 MW) 400 KV

Chukha HEP (336 MW) 220 KV

Kurichu HEP (60 MW) 132 KV Net import by India

Nepal Over 16 links of 132/33/11 KV

Net export to Nepal (about 10% of Nepals demand)


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Merging ofmarkets alongwith

synchronization of

NEW Grid

SouthGrid

South

West

North

East

Northeast

FiveRegional GridsFive Frequencies

October 1991East and Northeast

synchronized

March 2003West synchronizedWith East & Northeast

August 2006North synchronized

With Central Grid

Central Grid

INDIA

3,287,263 sq. km area

More than 1 Billion people (2001census)

Installed Capacity of

1,46000 MW (Jan-08)


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1 Status of a country is determined by per capita

power consumption

India 613 Kwh/year

World average 2596 Kwh/year

Country started with a very small MW 1947 -1500 MW

to 1,46,902 MW today

We are planning to add

10th Plan 41,000 MW

11th Plan 78,000 MW

Facing both peaking and general shortages

CURRENT SCENARIO


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76,988.88 53.3

Gas 14,704.01 10.5

Oil 1,199.75 0.9

Hydro 36,877.76 24.7

Nuclear 4, 120 2.9

Renewable 13, 242 7.7

Total 147965MW


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GROWTH OF THE POWER SECTOR

Per Capita Consumption of Electricity

Source :CEA


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COMPARATIVE PER CAPITA CONSUMPTION OF ELECTRICITY(Kwh)


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Overall improved

(Source: CEA)

T& D losses at 30.4% in 2005-06 were highas compared with low T& D Losses of 10-15% in some of the developed markets.

UK, US , Australia and Japan reported T & Dlosses as low as 4-8%


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Electricity, not a substance - A physical

phenomenon of flow of electrons.

It cannot be stored. Consumption and

generation have to match.

Flows through a medium to a path of least

resistance.

Electricity


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A) Consumers

Quality power supply UninterruptedAffordable cost

B) Government and its associated agencies

C) Generation Companies

D) Transmission CompaniesE) Distribution Companies

F) Financing Companies

And so on


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Background


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The Indian Electricity Act, 1910

Provided basic framework for electric supply industry in India.

Growth of the sector through private licensees. License byState Govt.

Provision for licence for supply of electricity in a specifiedarea.

Legal framework for laying down of wires and other works.

Provisions laying down relationship between licensee andconsumer.


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The Electricity (Supply) Act, 1948

Mandated creation of SEBs. Need for the State to step in (through SEBs) to extendelectrification (so far limited to cities) all across the country

Main amendments to the existing Acts

Amendment in 1975 to enable generation in Centralsector.Amendment to bring in commercial viability in thefunctioning of SEBs.

- Section 59 amended to make the earning of aminimum return of 3% on fixed assets a statutoryrequirement (w.e.f 1.4.1985)

Amendment in 1991 to open generation to privatesector and establishment of RLDCs Amendment in 1998 to provide for private sectorparticipation in transmission, and also provision relating

to Transmission Utilities.


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The Electricity Regulatory Commissions Act, 1998

Provision for setting up of Central / State ElectricityRegulatoryCommission to with powers to determine tariffs.

Constitution of SERC optional for States.

Distancing of Govt from tariff determination


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Resultant Industry Structure


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GENCO GENCO

DISCOMDISCOM

CUSTOMERCUSTOMERCUSTOMER

TRADERS

TRANSMISSION

DISCOM

GENERATION

TRANSMISSION

DISTRIBUTION

GENCO

Existing Market Structure


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CustomerCustomer

Distribution

Distribut

ion

Transmission

Transmission

Generation

Generation

CustomerCustomer

Open Access in

Transmission

Open Access in

Transmission

TRADERSTRADERS

OpenAccess

inDistribution

TRADERSTRADERS

DISCOMDISCOMDISCOMDISCOMDISCOMDISCOM

GENCOGENCOGENCOGENCO

Customer Customer

Proposed Market Structure in Act 2003

IPP


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Need for the New Legislation.

Requirement of harmonizing and rationalizing theprovisions in the existing laws to

- Create competitive environment for benchmarkcompetition which will result in enhancing quality andreliability of service to consumer.

- distancing regulatory responsibilities of Govt.

Reform legislation by several States separately.

Obviating need for individual States to enact their ownreform laws.

Requirement of introducing newer concepts like powertrading, Open Access, Appellate Tribunal etc.

Special provision for the Rural areas.


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Competitive

Bidding

Trading

Open Access

Regulatory

Commission /

AppellateTribunal

Restructure

Electricity

Boards

Controlling

Theft of

Electricity

Rural

Distribution

Delicenced

Delicenses

Generation

Private

Investments

Competitive

Environment

Liberal

Framework

Objectives of

Electricity Act

2003


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Industry Structure After Electricity Act 2003


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Role of Government.

Central Government to prepare NationalElectricity Policy and Tariff Policy.

(Section 3)National Electricity Policy released in 2004National Tariff Policy released in February2006

1. Competitive bidding in generation and transmission2. Standards of performance3. Multi-Year Tariff , adopted since April 1, 20064. Reduction of Cross Subsidy5. Time of Day metering6. Intrastate Availability Based Tariff7. Renewable Portfolio Standard


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Rural Electrification

Govt. to endeavor to extend supply of electricity to allvillages/hamlets. (Section 6)

No requirement of licence if a person intends togenerate and distribute power in rural area. (Section14)

Villages electrified as on 30th May 2006 439502

forming only 74% of total villages in the country.Rural Households having access to Electricity only 44%.

Only five states Delhi, Goa, Haryana, Kerala andPunjab (all of them very small in size) have achieved100% village electrification.


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Generation

Generation free from licensing.

Requirement of TEC for non-hydro generation done away

with.

Captive Generation is free from controls. Open access to

Captive generating plants subject to availability oftransmission facility.

The total captive capacity is currently at least 32,000 MW

and is growing handsomely, at a rate of 6% per year.

Generation from Non-Conventional Sources / Co-generationto be promoted. Minimum percentage of purchase of power

from renewables may be prescribed by Regulatory

Commissions.

13 States have come up with RPS regulations.


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Transmission

There would be Transmission Utility at the Centre

and in the States to undertake planning &development of transmission system.

The Load Despatch Centre/Transmission Utility /

Transmission Licensee not to trade in power.Facilitating genuine competition betweengenerators.

Open access to the transmission lines to beprovided to distribution licensees, generating

companies.There are 12 unbundled Transcos, eight SEBs andtwo partially unbundled SEBs (with combinedtransmission and distribution functions)


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DistributionDistribution to be licensed by SERCs

Retail Tariff to be determined by Regulatory commissions

Metering made mandatory Currently, as per officialfigures, 96 % metering has been achieved at the feederlevel and 92% at the consumer level.

Open Access in distribution to be allowed by SERC inphases

The act required the SERCs to frame guidelines forallowing

access in distribution for consumers drawing more than

1 MW ofpower by 2009. Accordingly, So far 22 states haveissued

regulations for open access in distribution.


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Consumer Protection.

Redressal forum for redressal of grievances ofconsumers, to be appointed by every distributionlicensee within six months. Ombudsman scheme

(Section 42 )Today, most states have regulations in place for theCGRF and ombudsman- 22 have CGRFs for utilities and22 have set up an ombudsman.

Standards of performance (20 states) Failure to meet standards makes them liable to pay

compensation to affected person within ninety days. Poor Publicity of these measure!


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Trading and Market Development.

Trading distinct activity permitted with licensing(Section 12)

Regulatory Commission may fix ceiling on tradingmargin to avoid artificial price volatility.

(Section 79(1)(j) and 86(1)(j))

CERC has put a trading margin of 4 paise/kWh.

Regulatory Commission to promote development ofmarket including trading

As on March 31,2008 an interregional power transfercapacity of 17000 MW was established by PGCIL.

Two Power Exchange permitted by CERC

The volume of power, traded in India of about 15 billionunits, equivalent to 2 to 3% of electricity generation.


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Regulatory Commissions and Appellate Tribunal

State Electricity Regulatory Commission to be constitutedwithin six months and Provision for Joint Commission bymore than one State/UT.-

So far, 27 states have constituted ERCs


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Tariff Principles Regulatory Commission to determine tariff

for supply of electricity by generating co.on long/medium term contracts. (Section62)

Except in case of Competitive Bidding and

Open Access Consumer tariff should progressively

reduce cross subsidies and move towardsactual cost of supply. (Section 61

(g), (h)) Tariff Policy stipulates cross subsidy level

to come around +/- 20% of average costof supply by 2011-12


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Restructuring of SEBs

Provision for transfer scheme to create one or morecompanies from SEB.(Section 131)

Provision for continuance of SEBs (Section 172)

As on May 31,2006, 13 states have unbundled theirSEBs into 16 Gencos, 13 Transcos and 37 Discoms whileother states are expected to follow.

Among the frontrunners were, Orissa in 1996, Haryana(1999), Andhra Pradesh (1999) and Karnataka (1999).


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The one duty we owe to history is to rewrite it

Oscar Wilde

Laws and Institutions are constantly tending to

Gravity.

Like clocks they must be occasionally cleaned,wound up and set to the time

Henry Ward Bucher

Perspectives


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Electricity Act 2003 -Sjvnl140509