birla power

8/13/2019 Birla Power

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Should Birla Re-enter Power Sector

Neha Gupta 2k12b02Rahul Srivastava 2k12b09Rajpreet Singh Walia 2k12b11Suniti Saxena 2k12b28Nitesh Singh Sengar 2k12b48



Power Sector Overview

India has the world’s fifth-largest electricity generation

GDP growing at around 5.0% in FY 12-13

Electricity demand growth 10-12%

Power deficits range between 9% &13%

Installed Capacity 211,766 MW as on Mar 2013

Percentage electrification 65%

Renewable generation capacity of 25,856 MW (12.5 % of totalgeneration capacity)

State-level generation companies account for about 47.13% ofgeneration



Overview

Private Sector Generation 29.49 % (62459 MW) of total installed

Transmission almost under Public sector (Power Grid Corp Ltd)

Distribution under state ownership – T&D losses 28.4% (FY 2012)

Renewable energy -12.20% of installed capacity but about 4%generated energy

Target to generate 20,000 MW of solar power by 2020

Total manpower in the power sector at the end of 10th plan wasapproximately 9.5 lakhs



Foreign Direct Investment (FDI) inIndian Power Sector

There is a significant drop in investor confidence in the last financialyear and the continuing policy stalemate is not doing any better forthe investor confidence. As per extant policy, Foreign DirectInvestment (FDI) up to 100% is permitted in the power sector, under theautomatic route, for;

Generation and transmission of electric energy produced in hydroelectric, coal/lignite based thermal, oil based thermal and gas

based thermal power plant Non-Conventional Energy Generation and Distribution;

Distribution of elective energy to households, industrial, commerciaand other users; and

Power Trading



FDI IN POWER Sector (in rs. ‘crore)



Developments in Thermal, Wind, Solar & Hydro sector



Hydro energy

India ranks 5th in terms of exploitable hydro-potential on globalscenario

The present installed capacity as on 31 October 2012 isapproximately 39,291.40 MW which is 18.77% of total ElectricityGeneration in India

hydro potential assessed to be about 84,000 MW

56 sites for pumped storage schemes with an aggregate installedcapacity of 94,000 MW have been identified. It is the most widelyused form of renewable energy.



Solar energy

In July 2009, India unveiled a US$19 billion plan to produce 20 GW osolar power by 2020

Under the National Action Plan From August 2011 to July 2012, Indiawent from 2.5 MW of grid connected photovoltaics to over 1,000MW

Thar Desert has been set aside for solar power projects, sufficient to

generate 700 GW to 2,100 GW

Various Solar power projects have been set up in Gujarat,Maharashtra & Rajastan.



Wind energy

Wind energy is one of the fastest-growing renewable energy sectoin the country

It has cumulative deployment of over 13,000 MW

It nearly 70% of the installed capacity in the renewable energysector in the country



Thermal power

India accounts for roughly two-thirds of the power generated inIndia

Reserves for thermal power generation include 59 billion tons ofmineable coal, 775 million metric tons of oil reserves and natural gareserves of 1,074 billion cubic meters.



Strong growth in generation capacity led percapita consumption urbanization

A growing developing and raw sector so publicand private sector can unlock value forthemselves

Abundant resources for power production

available especially renewableRegulatory mechanism for tariff settingestablished

Emergence of strong and globally comparablecontrol utilities like power grid

Storage of coal in power produmajor source of power

Government giveaways for freefarmer for political favours

Poor pipeline connectivity and

resulting in financial losses

Overloading and lack of adeqpower support

Government introducing policies like tax freebonds and low interest rates on infrastructure forpower sector

Investment in alternative sources of energymajorly renewable

Private sector participation into power sector

Introduction of FDI and FII policies

Investment in clean technology

Lots of time consumed in goveclearances

Depending on non-renewableimports

Losses leading to shutting of prcompanies

Blackouts due to gap in demapower

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Birla’s into power



Thermal and hydro energy

India has an installed capacity of about 175 GW with thermal andhydro power contributing 65 percent and 22 percent respectively.The balance is made up by renewables (10 percent) and nuclear (percent). It is estimated that the generation capacity required in2017 to sustain India's economic growth will be an additional 100GW.

We are well-positioned to explore the potential of the sector with itslarge installed base of captive power plants in various businessesand its exposure to mining.



Solar energy

The Government of India under the Jawaharlal Nehru National SolaMission (JNNSM) has set an aggressive target of 1,100 MW by 2013(11th Five-Year Plan) and 20,000 MW by 2022 (13th Five-Year Plan).In addition, many state governments have announced statepolicies on solar energy aided by the fledgling Renewable EnergyCertificate. A total potential of 64,000 MW by 2022 is estimated bybusiness research analysts.

The Birla's team is currently focused on the development of utilityscale solar power plants to position itself as an independent powerproducer (IPP) based on photovoltaic (PV) technology. It is alsocurrently participating in the development of a 5-MW solar PV planin Rajasthan, apart from various national and state governmentprograms to develop multi-MW solar PV power plants.



Wind energy

Essel Mining India Limited (EMIL), a part of our Group, India's first trulglobal corporation with operations in 36 countries. forayed intopower generation in 2005 by installing 75-MW windmills at Dhule inMaharashtra.



Thought of reentering

Kumarmangalam Birla promoted conglomerate is looking at re-entering the business through a two-pronged manner.

On one hand it will form a new company to acquire IPPs orIndependent Power Producers looking to sell out and is in theprocess of identifying potential acquisition targets.

On the other the company plans to participate in the government'case I and case II bids and the second phase of the 4,000 MWUMPPs through existing group companies.



Thought of reentering

Unlike earlier attempts to build power plants from scratch, the grouwill now acquire projects that already have land and environmentaapprovals, and just need to be built.

The second-stage entry will also enable the group to start producinpower, the third and final stage in the generation process, morequickly.

Plans of re-entering into power sector by investment of Rs. 6,000crores in solar energy in Rajasthan



Conclusion

Power Industry is moving from negotiation and guaranteedarangements of past era to more open market and performancebased competition

Private sector has emerged as key player in conventional andrenewable power

For us, it is right time to re-enter and warm up in the hearts of thegovernment

We should utilise our mutil-skilling to corner scarce resources andtranslate renewables into producing assets.

birla power

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