Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Indian Power Sector
Delhi Distribution - A successful public
private partnership Model TATA Power DDL - A case in point
Sanjay Banga TATA POWER –Delhi Distribution Ltd.
INDIA
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Structure of Presentation
• Indian Power Sector - resurgent & promising
• Delhi - Distribution Reforms
• TATA Power Delhi Distribution – a case in point
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Indian Power Sector- Inching towards a market driven structure
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Indian Power Sector
Electrification of households by 2012 – about 30% yet to be electrified.
Installed capacity over 2,10,000 MW ,Per capita availability of 1000
units
Quality and Reliable power supply – tremendous gaps.
Grid Discipline thru Availability Based Tariff.( ABT )
Govt. Initiatives to revive ailing state utilities . Tariff still not cost
reflective
Source: MoP, GoI
… Above throws tremendous opportunity on all gamut of activities.
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Distribution Sector
National average distribution loss – 32% . Most of state utilities are Govt
owned . PPP or franchise model initiated in major cities
Consumers to have supply choices through open access mechanism
through payment of :
Wheeling charges
Surcharge for cross-subsidy and
Distribution licensees do not require a separate license for trading of
electricity.
Dilapidated Network to match load growth , Absence of technology
Electricity Act 2003
Providing the Framework for Competitive Markets
CERC
SERC
CGSMega Power
ProjectsIPP/ CPP
Licensee
ownedGeneration State
Owned
Transmission PowerGrid (CTU) RPC/RLDC STU
Distribution
LicenseeDistribution Distribution
Licensee
Consumers
Trader
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Delhi Distribution Reforms
- Public private partnership
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
T&D Losses increased from 27% in 1992 to over 50% in 2001;
Govt. Utility Revenue Gap increased to approx. USD 270 Mln (2002); funded by Govt. subsidy to prevent tariff hikes;
Inadequate growth in distribution network and capacity for maintaining quality of supply;
Huge Gap between demand and supply of power; Frequency of power cuts had increased tremendously; Despite several efforts, no generation capacity (either IPP or own) added.
No concept of consumer service delivery.
8
Triggers for reforms
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Reform Objectives
Reduction in
AT&C Losses
Customer Focus
Self
Sustainable Sector
Attract investment
in Sector
Improvement in
Quality of
supply
9
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Public Private Partnership Model
• License-based Regulated business for 25 years
• AT&C target prefixed for 5 years as per bid
• Guaranteed 16% RoE on meeting AT&CTargets.
• Overachievement gains shared withconsumers.
• Tariff set by regulator on cost plus RoE10
• Power purchase payment on residuaryprinciples
• Financial support of approx. 630 MillionUSD by Govt. to DTL to cover shortfall ofDTL till March 07 for all Discoms
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Self Sustaining System
Discom Revenues(Units Realized based on committed
Loss reduction X RST)
All Prudent Expenses
ROE @ 16% Post Tax
BST Payable
(Balance- Capacity to Pay)
Transco RevenuesActual BST
Commission
Commission to balanceconsumer interest andviability of structure
Requirement beyond USD 767Mln to be met through SystemEfficiencies / Tariff Adjustments/Additional Support from Govt.
Shortfall met byGovt. Tr. Support
RST Growth
BST as the balancing figure (Capacity to Pay), together with Transition Support by Govt. to Transco for
making-up its shortfall ensure individual Discoms’ costs recovery at identical RSTs11
R&M Establishment
A&GDepreciation
Interest Servicing
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Key success factor ….Government Support
Strong Govt. support instrumental to success of Reforms
Providing Police Support for assisting theft control;
Special Courts for faster redressal of theft related cases;
Facilitating Right of Way /Road Cutting Clearances;
Land for Grid Sub-Stations at concessional rates;
Waiver of past (Pre-Privatization) dues;
Mass campaigns to garner consumer support.
12
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Key Success factor …Statutory/ Regulatory Certainty
Clean Balance Sheet
Only Serviceable Liabilities passed on to private Discoms;
Liabilities arising due to litigations/ claims from events prior to transfer
capped at app. USD 200,000; recoverable through ARR.
Binding Policy Directions issued by Government prior to Bidding
Buy-in of Regulator obtained;
Committed Loss Reduction Levels, based on successful Bids;
Assured Post Tax Rate of Return and incentive mechanism
Transition Support to Transco
Normative BST Order issued by Regulator prior to Bidding.
13Statutorily Binding Policy Framework – No risk of moving goal post or change in rules of the game
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
The TPDDL Case StudyBuilding a Sustainable Privatization Model in Distribution
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
The TATA Group- 100 years of Leadership with Trust
• The Tata Group comprises over 100 operating companies , 32 publically listed including TATA Power , in seven business sectors.
• The Tata Group is one of India's largest and most respected business conglomerates, with revenues in 20011-12 of $90 billion . 58% of it comes from outside India .
• The Tata Group has operations in more than 80 countries across six continents.
TATA group was awarded “ Carnegie medal of Philanthropy “ for its recognition of long
history of Philanthropic activities
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
TATA Power Company - Snapshot
Captive Power
Generation (“CPP”)
Generation
Independent Power
Generation (“IPP”)
Tala Project
Power
Transmission
Mumbai Area
generation
TATA POWER –Delhi
Distribution Ltd.
(TPDDL )
Distribution
1,797 MW
Mumbai Area
Transmission
NetworkMumbai Area
Distribution
TATA POWER –
JamshedpurPower Link
TATA Power Solar
TPC is the largest private sector player in Indian power sector.
Mundra Ultra mega
Power -4000 MW
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
TPDDL - Geographic Description
TPDDL
BSES
Rajdhani
BSES
Yamuna
NDMCMES
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
TPDDL Profile
Turnover (FY 2004-05) US $ 1000 million (up from US $ 275 million in FY 03)
Peak Load 1550 MW
Annual energy requirement
(FY 20011-12)
70000 Mn. Units
Total registered consumers (0.743Mn on T/o) 1.2 Mn.
Number of employees 3700 (5600 in July 2002)
Area 510 Sq Kms
Population serviced in Network area (approx) 4.5 Mn.
Per Capita Consumption (Units) 1245 (National Average of 606, Mumbai – close to 850)
Number of consumers per Sq.Kms 2100
Employees per `000 consumers 3.1
Employees per Mn. Unit input 0.51
Load / Energy Growth 06%
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Initial Challenges in July 2002
Change Management -
Working environment of offices & work
culture, a key area of concern
Dilapidated Distribution Network – the
supply system on the verge of collapse- an average consumer faced 110 hours of
supply interruption in a year.
Grievances on Revenue Cycle issues had crumbled without extra-ordinary interventions
New connections pending Pending - 100000 complaints in files more than 50% consumer records out of the total base of 7.43 lakhs received had some form of errors.
….. the challenges on take over were huge but consumer patience very little
INITIATIVES had to be taken that would deliver results quickly.
Sustained Network Improvements- towards enhanced Power Reliability
Each day witnesses concerted improvements in the Network.
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013 21
• Manned Grids
• Non communicable control panels
• DEBS - Billing
• Energize – Enterprise System
• E-mail and website
• IT Infrastructure
• Substation Automation & Interim
SCADA
• Communication Infrastructure
• GIS readiness for Sub transmission
• SAP-R3 (FICO, PM, MM, PS, HCM)
• Bulk Billing System
• BIRD
• AMR, Sakshat, Sanchay and RMS
• SCADA system
• DMS readiness
• GIS readiness for Distribution
Network
• SAMBANDH
• SAP-ESS, PMS
• DEBS Up-gradation
• Payment Gateway
• SAP-ISU, ESLA
• Secondary Data Centre (SDC)
• GIS readiness for LT network &
Consumers
• DMS & DA implementation
• Outage Management System
Smart Grid with Demand Response
• Enterprise Application Integration
(EAI)
• Mobile Workforce Management
(MWM)
• Smart Grid Roadmap
• Business Analytics
Operational Technology Information Technology2/25/2013
Proud of Technology Intervention - first in India/Delhi
2011-2012
2007-2010
2004-2007Integrated Automation road map formed & Implemented with KEMA consulting US and
Smart grid Roadmap with QUANTA technology US in progress
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
MWM FSR Module
Customer calls
with service request
Enroute
Onsite
Worked
Call center generate call
tickets in
SAP-ISU
Outage Management System
Network Management …… Effective technology deployment
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
System Interfaces
SCADA/DMS
GIS
Smallworld
Control Centre
Outage Management
System – for 1.8 million
Customers
CIS
WMS
•Provides location
•Provides circuit data
•Provides routing
•Takes trouble calls
•Informs customers of
restoration status
•Call assignment
•Trouble prediction
•Switching
•Dispatching
•Keeps OMS apprised
of status on monitored
devices
•Initiates work
•Tracks work status
•Closes jobs
•Meter
status
information
AMI
ASIAN Power utility award 2012 for best IT implementation award for Integrated
Outage management System .
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Change Management – Capability Building for the
Sector
• Creation of CENPEID for in-house training &
catering to competency building in entire
distribution sector by training employees of other
utilities
• Independent profit centre & recognized by
Ministry of Power as best institute in India
• Training Need Identification of employees
through the Performance Appraisal system,
Development Centre & 360 Degree Feedback
• Mandatory Training Policy formulation,
introduction of Group-level Training
Coordinators & systematic measurement of
effectiveness
• Mentoring for cultural assimilation & creation of
leadership pipeline.On-Job- Trainings for
continuous learning24
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Revamping Consumer Experience
25
• BPR of Revenue Management Cycle• Door Step delivery of new connections• Automatic Cash/ Cheque Collection Machines
• Video Conferencing for Consumers
• SMS based pull services
• Instant Connection
• Performance Assurance Standards
• Discount Coupons for Privileged and Paying Consumers
Business Process Reengineering of RCM
Call Center
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Change Management – Knowledge Management
Learning through Knowledge Management
– Online portal: SANCHAY & its various features e.g. Ask-The-Guru, Knowledge Café, Ndpl-O-pedia, etc
– Regular Knowledge Sharing Session (SEEKH ) sessions in each Group throughout the organization
– Corporate level Knowledge Sharing session (SEEKH ) sessions on themes: Safety, Strategy, Excellence, QC & Innovation.
– TATA innoverse - platform for innovative ideas across all TATA group companies
26
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Key Parameters…..Then & Now
2/25/2013 27
Parameter UoMJul-02
(On takeover)2011-12 % change
AT&C Losses % 53.1 11 77%
System Reliability – ASAI % 70 99.2 42%
Transformer Failure Rate % 11 0.8 93%
Length of Network Ckt. Km 6750 10253 51.8%
Street Light Functionality % 40 99.3 148%
Payment Collection Avenues Nos. 20 4599 22895%
Consumer Satisfaction Index - 88
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Key Parameters ………. Then & Now
2/25/2013 28
Parameter UoMJul-02
(On takeover)2011-12 % change
Mean Time To Restore Supply Hrs. 5.2 1.2 75%
Street Light restoration within 48
hrs.% 50 99.70 99%
New Connection Energization Time Days 51.8 6 88%
Faulty Meter Replacement Days 25 6 72%
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
110
70
36
23
9.3 8.7 7.11 8.68 8.63 6.31 5.68
0
20
40
60
80
100
120
FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12
Reliability Improvement in SAIDI(Hrs.)
55
35
18
12
6.3 85.48 5.93 5.69 4.48 4.03
0
10
20
30
40
50
60
FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12
Reduction in SAIFI(Nos.)
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Power Sector Reforms Through PrivatisationTransitional Support Vs Continuing With Financial Loss
30%
35%
40%
45%
50%
55%
60%
65%
70%
AT
&C
Lo
ss (
%)
Scenario I
(Cumulative
Saving 716.14
mn)
Scenario II
(Cumulative
Saving 328.92
mn)
Scenario III
68.83 mn
FY 03
100.44 mn
89.91 mn
FY 04
162.33 mn
FY 05
197.76 mn
130.71 mn 143.04 mn
85.20 mn
26.01 mn
Pre-privatisation losses
burgeoning
Scenario I: Losses growing at same trend as in pre-privatisation &
stagnating 65%.
Scenario II: Losses maintained at the same level as at time of
privatisation.
Scenario III: Losses lowered post privatisation.
Jul 02Apr 01
Post-privatisation:
Lowering Losses leading to
reduced subsidy
Mar 03 Mar 04 Mar 05 Mar 06
30.02 %
FY 06
211.43 mn
145.29 mn
491.93
Scen-I
(Cum.
saving
US $
491.93
mn
Scen II
(Cum.
saving
US $
328.92
mn
Savings to the Government
If reforms were not undertaken and considering the prevalent scenario of the losses increasing consistently Reforms & privatization has actually saved the Govt. significant sums, which is now available for
Infrastructure, Education, Health, etc
This owes itself to the fact that losses have been reduced from 53.4% to 30.02% in three years.
All Figs in US $
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
AT&C Loss Reduction- Benefit to Government
31
• Saved over USD 1.45 Billion for Govt. in 10 years; facilitated development of other infrastructure; lower taxes
• Repaid USD 100 Million loan to Govt.
• Paid Dividends to Govt. and Tata Power for four years (FY 2005-06 to FY 2008-09)
Extensive network improvement, commercial reengineering and IT intervention- major contributors to
AT&C loss reduction
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Entrepreneurship ..NDPL’s window to the world
Prestigious consultancy projects:
Technical consultant for Five states states in INDIA for
implementing SCADA/DMS and other IT systems .
Project Management for UP & Haryana in India for Network
revamping .
Restructuring of Transmission & Distribution sector of Mauritius
in association with M/s TCS Ltd.
Setting up of CENPEID under DRUM program in association
with USAID.
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Entrepreneurship ..NDPL’s window to the world
• TPDDL along with Consortium Partners has been selected as “Preferred Bidder” for Benin Disco.
• Management and Technical Services through dedicated employees in important areas like –– ATC&C Loss monitoring & Business Process Reengineering
– Network Planning Services
– Automation & IT Services etc
Collaborating with other consortium partners to replicate
Success story of Delhi.
Together we can make it
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Recognitions
Edison Award 2008 for GIS
Implementation
Balanced Scorecard Hall of
Fame
Asian Power Awards 2008,
2010,2011
National Award for Meritorious Performance by GoI
ICWAI National Award for Excellence in Cost Management 2007
India Power Awards 2008
SAP Ace Award 2008
Infra line Energy Award
Corporate Presentation
Visit us at www.tatapower-ddl.com
2/25/2013
Thank You