Challenges in the Tamil Nadu Electricity Sector

Agenda

• Historical Overview• Current situation in Tamil Nadu• Challenges in the Electricity Sector

• Generation• Transmission• Distribution

• Institutional

The Past –1990’s

1990 - 2003• 1990’s- State electricity boards in a mess –

• lack of electricity generation, power cuts, no investments in critical areas.

• GoI recognized the seriousness of the situation& passed the Electricity Act in 2003• Allowing private sector participation in all areas

of the electricity sector…• It was hoped this would change the situation and

energize the electricity sector!

Tamil Nadu 2012

Unfortunately…

• Despite the reforms…• Electricity supply has not kept with Electricity

Consumption• Scheduled power cut 1 hour in Chennai• Unscheduled power cut 8-10 hours in other

parts of Tamil Nadu• Agricultural and Industrial production affected• Affecting daily lives

The Future…?

The Blame Game…

Tamil Nadu Electricity Sector

Tamil Nadu Electricity Sector was Previously a single entity – Tamil Nadu Electricity Board (TNEB)

TNEB

Disaggregated into …

Generation DistributionTransmission

HELPLESS CONSUMERS

TANGEDCO AND TANTRANSCO

Regulator - TNERC

Challenges in the Electricity Sector

•Demand: 12,000 MW

•Supply: 8000 MW

•Shortage: 4000 MW

Electricity Generation

Environmental Clearance

• Udangudi TPS (2 x 800 MW)

• Cheyyur project

Land Acquisition

BHEL’s projects in TNe.g. Vallur Thermal Power Project North Chennai Thermal Power Station

Water linkage

Tamil Nadu naturally water deficit state

Fuel linkage• Shortage of coal production

- Coal India Limited (CIL) • High cost of imported coal• Getting Right of Way

Delays & Costs overrun

• e,g, Cheyyur Power Plant

• BHEL

Transmission

•Inadequate evacuation facilities – no 400 KV transmission lines to evacuate generated capacity

•Projected T & D losses are 18.5%

•Scope of future generation projects is therefore hampered

Challenges

Transmission Congestion

• Lack of transmission capacity

• Limit the quantum of power

• E.g. Gujarat Urja Videsh Nigam Ltd. (GVNL)

Grid Stability • Consumption and overdrawal causes grid instability

• Wind, Tangedco

Distribution

Operational Costs

• Loss Rs. 200 crores everyday

• Depends on loans for paying salaries etc.

• Loses 95 paisa per unit on 3029 MU

Subsidised power

1. Agricultural sector subsidy

- Rs.250/HP/annum but now it is Rs.1750/HP/annum with a hike of about 589%

2. Hut Sector - Unmetered

Total Accumulated Loss Rs. 45,000 crores

Theft

Non-Existent Meters for Agricultural Sector And Huts

• 32,83,987 Nos.• large number of meters non-functional

• Manpower Shortage

• Lack quality and Technical knowledge

Institutional factors...

Institutional Contd…

Who will be our Saviours?????

Finally…

Nothing will change unless…Consumers demand quality service from utility

providersBy forcing the political setup to improve

electricity systems And making Tangedco accountable & Regulator

independent.