Demand is actually determined by the access to electricity and the ability to pay for it. Power is one of the most crucial components of infrastructure. It can be said that it is the backbone of any economy. India needs urgent policies and reforms to overcome the present crisis in the power sector. Many private players in the power sector in India have incurred heavy losses as they had miscalculated the demand projection of power. At present, the major problem of the Indian power sector is that it is on the brink of overcapacity. While power generation capacity has increased, the demand growth for power is yet to take off.
The India Power Corporation Ltd. (IPCL), the Calcutta Electric Supply Corporation (CESC) and the West Bengal State Electric Distribution Company Ltd. (WBSEDCL) are among the successful players in the power sector in West Bengal. A detailed analysis of their growth stories and consumer interface can lead to a better understanding of the power sector in the state.
India Power Corporation Ltd. (IPCL)
India Power Corporation Ltd. (IPCL), formerly known as DPSC Limited, was established in 1919. It is one of the oldest power companies in India and has a rich experience in the power distribution business. IPCL aims to empower industries and its customers by being the lowest cost, most reliable and environmentally sound conventional and non-conventional energy provider. It is truly a ‘holistic power company’ as it is spread across generation, transmission, distribution, renewables, services and trading of power.
Generation: IPCL has generation units in West Bengal in Dishergarh (12MW) and Haldia (Hiranmaye Energy Ltd.).The Haldia unit has 300MW of operational capacity and has another 150 MW capacity under implementation. It has also acquired the Meenakshi Energy Limited in Nellore, Andra Pradesh which has an operational capacity of 300 MW and a further 700 MW is under implementation.
Transmission: IPCL focuses on the regions of J.K. Nagar and Pandabeswar for power transmission.
Distribution: IPCL is functioning as a strong player as distribution-licensee in the Asansol-Durgapur-Ranigunj area of the Burdwan district, West Bengal. It is one of the few regions that have real competition in the power sector with three players operating in that region. According to Somesh Dasgupta, President of IPCL, “The existing competition has actually been a disguised blessing for us as it has made us highly competitive.” It is also operating as distribution franchisee in the Gaya-Bodhgaya-Manpur area of the Gaya district, Bihar since 2014.
Renewable: The company is also consolidating its position in the renewables sector. IPCL has operational wind power plants in Karnataka (10.4 MW), Gujarat (24.8 MW), Maharashtra (5 MW) and Rajasthan (60.0 MW) as well as solar power plants in Seebpore, in the Jamuria region of West Bengal (2 MW). It is also implementing another solar power plant in Uttarakhand (3 MW).
Service: India Power has launched India Uniper Power Services in collaboration with Uniper, a German company. This collaborative unit aims to provide service solutions to the conventional power sector and is designed to improve efficiency, profitability and competitiveness of thermal power plants. It is a first-of-its-kind initiative in India.
Trading: A wholly owned subsidiary of IPCL, IPCL Power Trading Pvt. Ltd. has been formed and has received a category-3 trading license from the Central Electricity Regulatory Commission (CERC). By virtue of this licence, IPTPL can now trade in up to 628 MU of electricity per annum on a pan-Indian basis.
Views: India Power has been successfully facing competition and has been recording steady growth as compared to many bigger players in the power segment. Talking about the Indian power sector, Sanjeev Seth, CEO of IPCL, informed BE, “The Indian power sector needs area wise strategies and balanced plans and policies. India is much behind in respect to technology adaptation. The government has to take all the stake holders on board while designing plans and policies.” Ensuring necessary reforms and performance standards can accelerate the growth of the Indian power sector.
Somesh Dasgupta, President of IPCL told BE, “Theft is the main bottleneck towards optimality in power sector. Additionally, reform in the power sector is a key requirement. Parallel licensing for power distribution is the necessity. Power generation cost has to be less. Assess billing is also a big problem. Open access should be encouraged by reducing cross subsidy.” Talking about the present downward market of the power sector, Jyotirmoy Bhaumik, Director of Hiranmaye Energy Limited (Formerly known as India Power Corporation (Haldia) Limited) stated optimistically, “In coming two to three years, the present situation will be reversed.”
Calcutta Electric Supply Corporation (CESC)
The Calcutta Electric Supply Corporation (CESC) is a Kolkata-based flagship company of the RP-Sanjiv Goenka Group under the chairmanship of Sanjiv Goenka. The company has extended its operations to Kota, Bikaner and Bharatpur in Rajasthan.
The company has touched several milestones in terms of operational excellence. According to an e-mailed corres-pondence to BE, the operations and profitability of CESC for 2017-18 is as follows -
l Profit before Tax (PBT), Profit after Tax (PAT) and Total Comprehensive Income (TCI) for the year stood at Rs. 1111 crore, Rs. 871 crore and Rs. 861 crore respectively as compared to PBT of Rs. 1101 crore, PAT of Rs. 863 crore and TCI of Rs. 824 crore for the previous year.
lYear to Date sales growth stood over 3.9%.
lDebt Equity Ratio remained well below 1.
lT&D Loss was significantly lower than previous year.
As part of company’s initiative to upgrade its electricity infrastructure to provide efficient and reliable electricity supply, the company has made substantial investments for upgrading the city’s electrical distribution infrastructure.
Generation units of CESC
l The Budge Budge plant of CESC is ranked among top performing power plants in the country. The Plant Load Factor (PLF) of this plant is more than 90%.
lThe Haldia power plant under CESC is operating at a PLF of 86%.
Distribution and Customer Service: CESC continues to thrive to provide an uninterrupted supply of power to its consumers by upgrading the distribution infrastructure and processes for enhancing the quality of power supply. CESC’s journey towards excellence is characterised by customer centricity. Listening to consumer feedback and realigning processes accordingly is one of the major initiatives taken by CESC.
West Bengal State Electricity Distribution Company Limited (WBSEDCL)
The West Bengal State Electricity Board is diversified into two major companies - West Bengal State Electricity Distribution Company Limited (WBSEDCL) and West Bengal State Electricity Transmission Company Limited (WBSETCL).
The business of WBSEDCL includes distribution and hydro generation of electricity. It has been undertaking rural electrification in line with the National Rural Electrification Policy. WBSEDCL provides quality power to a customer base of more than 1.78 crore across West Bengal. After successful implementation of the ‘Purulia Pumped Storage Project’ in the 10th plan period with a capacity of 900 MW hydel power, the company is planning to implement ‘Turga Pumped Storage Project’ in the 13th plan period with installed capacity of 4 x 250 MW.
For solving complex customer challenges and for providing more efficient service to the consumers, a project titled ‘Integrated Power Development Scheme’ aimed at strengthening sub transmission and distribution networks, metering of distribution transformers, etc. in the urban areas, has also been undertaken. A programme for system improvement under ‘Sech Bandhu Scheme’ has also been conceived for rural areas by WBSEDCL.
The company is innovating and embarking upon an IT-enabled system across the organisation to ensure greater engineering predictability and to ensure greater customer service, efficiency and financial viability.
According to the Regulatory Commission’s Tariff Order (2016-17) a current comparison of average power supply tariff for West Bengal between IPCL, CESC, WBSEDCL is given below:
Conclusion: Merchants’ Chamber of Commerce & Industry (MCCI), Kolkata, has recently organised the ‘East India Energy Forum’. The state power minister Sovandeb Chattopadhyay attended the meeting. He categorically stated that the state and his department are ready to cope up with the present challenges of the power sector. The minister has mentioned in the context of surplus generation of power in the state, that the state is exporting power to Bangladesh and to other states in India. He has emphasised that his department is taking up big projects of laying underground electric cable connections for 75 towns across the state.
Chattopadhyay said, “The Budget allocation for power has been increased from `494 crore in 2011 to `2818 crore in 2017–18. Consumer base has been increased from Rs.85 lakhs in 2011 to Rs.1 crore 81 lakhs in 2017 and 99.98% of domestic connections has been completed.” He has also said, “Although the state has been facing debt trap, subsidies to the tune of Rs. 886 crore have been provided to the needy. Power connection has been given to consumers consuming less than 300 units at a highly subsidised rate of Rs.279.”
He also mentioned that the Government of West Bengal has received five coal mines from the Indian government and stated that this will aid the power sector in the state. He attributed the rising price of power to the rising prices of inputs. He has pointed out that from 2011 to 2017, there have been 16.20% rise in coal prices, 7.17% rise in oil prices along with around 18% rise in railway freight.
Initiatives for High Tension Consumers by CESC
lOnline application introduced for the new HT consumers. An existing HT consumer can now access details like e-bills, consumption history, payment history, agreemental load history, security deposit position, etc. through the website.
l HT consumers have also been allotted a single point of contact in the rank of the Deputy General Manager for contacting CESC at any point in time.
l Extension of facility of carrying out Proactive Condition Monitoring of HT Consumers’ installation.