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INDIAN Power Outlook2012
presentation by:
Nithin Haridas
Sales Conference, GCT Chennai March 05, 2012
Overview
2011 INDIA
• Home to 1.2 Billion people, 17% of the world’s population.
• FDI into India is ranked third globally.
• With this high economic growth comes a voracious appetite for energy.
• Widening gap between demand and supply due this meteoric growth.
• Needs to accelerate exploitation of natural resources.
• Long term plans foresee coal as the sector with the most growth potential.
• Currently about 35% of India’s commercial energy needs are imported.
Primary Energy
• GoI’s Planning Commission predicts dramatic demand increase for coal in TPP’s for the next 20 years.
• The bulk of hydro power contributes to roughly 25% of total energy generated.
• Biomass has maintained a constant value since 1980’s and had the major share in the final energy mix till about 2008 but is likely to diminish with other forms of energy becoming favorable.
• Nuclear energy contributes to more than 4000 MW.
• Renewable energy sources are on the rise due international pressure in reducing CO2
emissions.
• Fig 1-2 depicts the anticipated Total Primary Mix.
The Source
Primary Energy
The Source
Installed Capacity / Generation Mix
Power sector at a Glance
• As on 31/01/2012 CEA reports total installed capacity of 1, 87,549.62 MW of power
in INDIA
•The following are the splits:
• State Sector – 83, 605.65 MW, 44.57%
• Central Sector – 57,832.63 MW, 30.83%
• Private Sector – 46,111.34 MW, 24.58%
• The 11th Plan targeted an installment of 78700 MW (excluding RES) of power.
Installed Capacity / Generation Mix
The following graph indicates the installed generation capacity as on 31 Jan 2012
34654
86015
3900 7760
38848
123759
4780
20162
0
10000
20000
30000
40000
50000
60000
70000
80000
90000
100000
110000
120000
130000
140000
150000
160000
Hydro Thermal Nuclear RES
Un
its
in M
W
Installed at the end of 10th Plan Achieved Proposed during 11th planAs on 31-01-12, Source: CEAAs on 31-01-12, Source: CEA
Installed Capacity / Generation Mix
Sector wise distribution – Installed Capacity
38848.421%
123758.9866%
47802%
20162.2411%
Hydro
Thermal
Nuclear
RES
As on 31-01-12, Source: CEA
TOTAL: 187.6 GW
Installed Capacity / Generation Mix
Thermal Split
Hydro38848.4
21%
Nuclear 47802%
RES20162.24
11%Coal
10481656%
Gas17743
9%
Diesel12001%
Thermal66%
TOTAL: 187.6 GW
As on 31-01-12, Source: CEA
Installed Capacity / Generation Mix
Growth of Installed Capacity
4285
63636
69065
85795
105046
132329
187549
0
50000
100000
150000
200000
250000
6th Plan 7th Plan 2nd Plans 8th Plan 9th Plan 10th Plan 11th Plan
Power
Linear (Power)
Source: CEA, 2012
Power Supply Position
The Gap between the demand and supply for Peak Demand over the past few years as per the Load Balance Generation Report by CEA is as depicted below:
93255
100715
108866 109809
119166122287
136193
8179286818
90793
96785
104009
110256
118676
0
20000
40000
60000
80000
100000
120000
140000
160000
2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 (anticipated)
in M
W
Requirement
Availability
Power Supply Position
For Energy Requirement as per CEA LGBR 2011:
631554
690587
739343777039
830594861591
933741
578819
624495
666007691038
746644
788355
837374
0
100000
200000
300000
400000
500000
600000
700000
800000
900000
1000000
2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 (anticipated)
in M
U
Requirement
Availability
Power demand will outstrip supply well into the XII Plan.
Targets / Achievement
11th Plan: 2007-12
• The original target for the whole of 11th Plan has been scaled down to 62,000 MW from 78,700 MW.
• May end up adding only 52,000 MW by March 2012.
0 10000 20000 30000 40000 50000 60000 70000
Hydro
Thermal
Nuclear
RES
Achieved as of 31/01/12
Proposed during 11th plan
Targets / Achievement
The capacity addition envisioned during period 2011-12 is as shown below:
2080
14636
1000
1281
11079
0
0 2000 4000 6000 8000 10000 12000 14000 16000
Hydro
Thermal
Nuclear
in MW
Achievement
Target
Achievements of the set targets is as on 31-Jan 2012.
• Planning Commission set a target of 17716 MW last year (2011-12).• Out of which 12360.5 MW has been achieved, i.e. 69.8%.
Factors Governing / Affecting Power Production
Slack in Power Production
• Thermal Power Plants projects are facing difficulty due to non - availability of Coal and GAS.
• Environmental clearances.
• Land Acquisition Challenges.
• Current transport infrastructure – especially coal (railway network) / pipelines for GAS).
• Investments in Transmission and Distribution Systems corresponding to planned increase in generation.
• Financial Constraints.
Factors Governing / Affecting Power Production
Coal is King
• Coal provides more than one quarter of the world’s primary energy.
• India’s coal consumption ranks third in the world.
267210
123470
105820
37920
0 50000 100000 150000 200000 250000 300000
Total
Indicated
Proved
Inferred
in Million Tonnes
Coal Resources
Source: Ministry of Coal, 2009
Factors Governing / Affecting Power Production
Coal is King
• Accounts for 56% of installed power capacity in India.
• India’s coal demands are met through Coal India.• Annual production remained at 430 – 431 million tons for the last 2 years.• Already missed target production by 7 %.
• Imports expected to almost double this year.
• Demand and Supply gap is shown in the next slide• Gap is due to environmental clearances not accorded to mining projects.
Factors Governing / Affecting Power Production
Coal is King – Demand-Supply
504.29
546.1
582.32
656.31
713.24
454.49
490.02514.58
573.42591.78
0
100
200
300
400
500
600
700
800
2007-08 2008-09 2009-10 2010-11 2011-12*
Mill
ion
To
nn
es
Demand
Availability
* As per the latest assesment, Source: Ministry of Coal, GoI
Factors Governing / Affecting Power Production
Coal is King
49.8
56.08
67.74
82.89
121.46
0
20
40
60
80
100
120
140
2007-08 2008-09 2009-10 2010-11 2011-12*
Mill
ion
To
nn
es
Import of Coal
Import
Source: Ministry of Coal, 2012
Factors Governing / Affecting Power Production
Coal is King – Import Viability
• Import more viable to plants set up near ports.
• Landed cost is around $ 140 – 145 per ton.
• Total cost of power is more or less Rs. 4 per unit.
• Power production with indigenous supply amounts to less than half that cost.
• Rise in cost along with lower market rates are hurting many companies.
Future
Nuclear
•The department of Atomic Energy is mandated to increase the share of nuclear energy.
• The signing to Indo – U.S. nuclear deal has opened up opportunities.
• Nuclear Power Corporation of India Ltd. (NPCIL) – Soul nuclear power generator.
• Aim of increasing installed capacity form 4780 MW to 21,000 MW in five years.
• NPCIL already entered into agreements with various international companies to import fuel and equipments.
• GoI wants the share to of nuclear in overall fuel mix to increase from 2% to 25% by 2050.
Future
RES on the rise
• India faces enormous international pressure to keep greenhouse gases under check.
• GoI has been very active in various international efforts in climate change mitigation.
• National Action Plan on Climate Change (NPACC) – announced as way forward to reduce carbon intensity.
• India will have choose between increasing fossil fuel use and reducing its emission.
• The Ministry of New and Renewable Energy (MNRE) plans and promotes the development of all sources of renewable energy.
• By far the largest renewable energy source in India is Hydro Power.
Future
RES on the rise – Installation Split
Wind Power1306668%
Small Hydro293915%
Bio Power263214%
Solar Power481.4
3%
Total Capacity Addition upto 2012
Source: MNRE, 2012All units in MW
Future
RES on the rise – 11th Plan Targets / Achievement
0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000
Wind Power
Small Hydro
Bio Power
Solar Power
in MW
Achieved upto 2012
Targets for 11th plan
Source: MNRE, 2012
Future
RES on the rise – Power of the Sun
• The 11th Plan targeted only 50 MW of capacity addition in the Solar Segment.
• The previous slide shows otherwise; largely due to planning and announcement of new policies.
• GoI, through MNRE launched the Jawarharlal Nehru National Solar Mission (JNNSM), as a by product of India's National Action Plan on climate change.
• JNNSM tries to make solar competitive through scale-up of capacity and technological innovation.
Future
RES on the rise – JNNSM
• Adopts a three phase approach:
• Phase 1• Tries to achieve a grid connected generation of 1000 MW.• This will span through remaining of the 11th Plan to 2013.
• Phase 2• Grid connected capacities upto 3000 MW to be achieved.• This could be more than doubled by international finance and Tech. transfer.
•Phase 3• Based on the review of Phase 1 and 2, and subsequent setting of target.• By 2022, 20,000 MW of capacity (both gird and off-grid) to be installed.
Future
RES on the rise – JNNSM viability
As ambitious as JNNSM seems to be, MNRE might actually pull it off owing to some of the following reasons:
• Foreign direct investment upto 100%.
• Renewable Power Purchase Obligations (RPPO).
• Build Own Operate.
• Build Own Transfer.
• Provision of Subsidies.
• Environmental Regulations.
In SUMMARY
• India’s power sector will see an increased capacity addition by private sector over the coming years.
• Coal will continue to meet India’s energy needs well into 2030 according to Planning Commission.
• The nuclear sector might proceed with joint ventures with NPCIL, since it has been opened to other Govt. owned entities.
• Renewable Energy Sector is on the rise and opportunities are widespread.
• Expansion of over all energy demand-supply gap due to increase in population and increased GDP growth renders tremendous investment opportunities in this sector.
THANK YOU
References
• Central Electric Authority (CEA), 2012
• “Load Generation Balance Reports”, Central Electrical Authority, 2005 to 2011
• “CEA Annual Reports”Central Electrical Authority, 2005 to 2011
• “MNRE Annual Reports”Ministry of New Renewable Energy, 2012
• “NPCIL Annual Reports” Nuclear Power Corporation of India Limited, 2010
• “Jawarharlal Nehru National Solar Mission (JNNSM) Government of India - MNRE -Report, 2010
• Annual Report, Ministry of Coal, 2012
• India Energy Handbook – 2011
• World Coal Institute – India “The coal Resource, a comprehensive overview of coal”March – 2009.