demand side management in india: technology & landscape...
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Demand Side Management in India: Technology & Landscape assessment Roadmap for Future. Summary Report of Workshop Proceedings
28th June, 2014. New Delhi.
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Contents
Introduction: Welcome address by Prof. Rangan Banerjee, IIT Bombay. Inaugural Address by Shri Gireesh Pradhan, Chairperson, CERC. Inaugural Address by Dr. Ajay Mathur, Director General, BEE. Vote of Thanks by Ms Natasha Bhan, SSEF.
Presentation 1: Technology & Landscape assessment:
Prof. Suryanarayana Doolla. Presentation 2: Vision & Roadmap for DSM:
Prof. Rangan Banerjee. Open discussion: Scaling up of DSM in India.
Summary & Future course of action.
Vote of Thanks by Prof. Suryanarayana Doolla.
Annexures o Annexure 1 : Concept Note o Annexure 2 : Workshop Program o Annexure 3 : List of participants
o Workshop Group Photograph
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Introduction
IIT Bombay organised a workshop on Demand Side management (DSM) in conjunction
with and the support of Shakti Sustainable Energy Foundation (SSEF). A representative
group of 56 experts and officials from state electricity regulatory bodies, utilities, ESCOs and
academia attended the event. The objective of the workshop was to present and discuss the
findings of the Technology & landscape assessment report and lay out the vision and
roadmap for DSM in the country. The workshop was designed to be interactive and to
stimulate conversation and exchange of ideas across the different groups. An open
discussion was conducted to identify the challenges facing large scale deployment of utility
driven DSM programs in the country.
The workshop was inaugurated in the esteemed presence of Shri. Gireesh Pradhan,
Chairperson, Central Electricity Regulatory Commission, and Dr. Ajay Mathur, Director
General, Bureau of Energy Efficiency.
Welcome address by Prof. Rangan Banerjee
Prof. Rangan Banerjee presented the backdrop of the workshop as one organised to present
the findings of the research work done during the tenure of the project undertaken by IIT
Bombay under the sponsorship of Shakti foundation. He mentioned that the project report
outlines the state and status of DSM in the country and presents a set of recommendations
for the way forward. He welcomed Shri. Gireesh Pradhan and Dr. Ajay Mathur as key
leaders responsible for energy efficiency and DSM in the country and requested them for the
inaugural address.
Inaugural address by Shri. Gireesh Pradhan
The focus of the decision makers in the energy sector has been predominately on the supply
side. Despite the huge potential at the demand side, DSM doesn’t find any presence in the
legal tracks or in the national electricity policy. So the challenge was to come up with a
regulatory framework which was done in the form of model DSM regulations by Forum of
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Regulators (FOR). Although, as
many as 9 state regulatory
bodies came up with their own
DSM regulations on the lines
model DSM regulations, it is
perceived that these states have
not really moved far ahead and
one of the reasons was that the
states didn’t clearly enunciate
and articulate a DSM policy. Majority of the DISCOMs to which DSM really makes sense
are all in the government sector and in bad financial health. Some of these DISCOMs argue
that DSM requires investment and banks are not ready to lend their support as DSM seems
to be a risky proposition. So, there is need of a business model to carry out DSM projects
and the involvement of ESCOs can move DSM initiatives in a substantial way. Load Flow
studies, if carried carefully, can help in planning meaningful DSM interventions. Most of the
Public utilities have a large rural spread and the kind of energy waste that happens due to
inefficient agricultural pumps needs their attention. Agricultural feeder segregation programs
are relevant steps in that direction. It is necessary for all states to have some sort of
regulatory framework for DSM in place. The feedback from utilities and other stakeholders
can be taken to calibrate those frameworks such that they produce desirable results on
ground.
Inaugural address by Dr. Ajay Mathur
DSM presents opportunity to enhance end-use efficiency. Utility driven DSM needs to be
promoted because utilities have a reach to very large number of households and have a
monthly financial transaction with them through an established institutional network.
Moreover there is a possibility to align the interest of distribution companies and the energy
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efficiency programs. Currently,
these interests seem not to be
aligned and DSM is perceived as
something that reduces sales.
There is a need to figure out ways
to align the interests of the
distribution companies with that
of energy efficiency programs.
Most of the DSM projects that
have happened are done by
private utilities with few notable initiatives from public utilities like Energy management
centre, Kerala for the promotion of CFLs. It is crucial to carry out DSM projects even if
they are not designed perfectly because if they are successful, the benefits will be seen and
will be copied. This would generate the kind of interest towards DSM that is required in
order to bring out more order and organisation in terms of incorporation of load research
studies during the design of future DSM programs. DISCOMs need to carry out load
research to figure out areas and ways through which peak load can be reduced and loss
minimisation can happen. DISCOMs are forced to buy 50% to 100 % more electricity
during the peak times than that during the rest of the year and this expensive. Thus there is a
clear interest among utilities for managing this peak load. The option of demand response
strategies and promotion of use of energy efficiency products can be evaluated by utilities to
pursue peak load management. The issue of loss minimisation is crucial in context of
agricultural loads where electricity is provided almost for free. The agricultural DSM
programs implemented in Sholapur and Hubli proves that savings up to 20 % can be
achieved by replacing inefficient pumps. The challenge is to convince utilities that there are
ways in which they can be better off financially considerably. There is a constant pressure on
utilities to avoid increasing tariff and improve service quality. In such difficult situation, the
only way is to promote ESCO based DSM measures. DSM programs implemented by EESL
provides on the ground evidence that DSM works. The challenge exists in large scale DSM
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implementation. There is a clear need to develop ability to disseminate the DSM results and
experiences from one geographical location to another so as to show that there is both
energy and financial benefit that happens to DISCOMs as a result of DSM. Bureau of
Energy Efficiency and Energy Efficiency Services Limited are together providing support to
various utilities to carry out DSM. But this also requires training the people from utility side
and IIT Bombay can help in extending their expertise in this direction. This would result in a
valuable dovetailing of the actions of DISCOMs and the capacity building initiatives by the
institute. Regulators like to make sure that kind of intervention that happens in context of
DSM actually results in benefits. This needs better methods for monitoring, verification and
assessment. There is a need to devise ways to ring-fence and show that there is an actual
cash and energy flow benefits that occur due to DSM. It is also crucial to develop
understanding about the kind of needs that the utilities have and find out strategies to bring
together the expertise to help utilities adopt DSM practices.
Vote of Thanks
Ms Natasha Bhan extended the vote of thanks to Shri. Gireesh Pradhan, Dr. Ajay Mathur
and the participants that they spared a day to attend the event. She thanked the project team
on their job to come up with a comprehensive report on landscape and technology
assessment of DSM in the country. She also asked the participants to send their comments
and feedback on the report so that they can be incorporated in the final report.
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Presentation 1: Technology & Landscape assessment
Prof. Suryanarayana Doolla
presented the experiences and
findings of the landscape
assessment conducted during
the project tenure. He also
enumerated the various
technology options for DSM
that have been discussed in the
draft report. He described the
approach for carrying out the
landscape and technology
assessment in detail. He
mentioned that a stakeholder
meeting was conducted during the early months of start of project in order to get the input
about the status of DSM in the country and identify the issues impeding the growth in scale
of DSM implementation. He also intimated the audience that a training workshop was
conducted in Lucknow during which UPERC launched their draft DSM regulations. He
stressed on the need to make data and case studies available in a particular format and
introduced the audience to the website that has been developed by the project team with the
intent to make available all the possible relevant information, case studies and reports related
to DSM in the country. He asked the participants to share any information related to DSM
projects so that they can be collected and collated at a single place for public dissemination.
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Presentation 2: Vision & Roadmap for DSM
Prof. Rangan Banerjee discussed the issues
involved with unsustainable model of
constructing power plants as a means to
meet future energy needs. He drew the
attention of the audience towards the
longer gestation period and adverse
environmental impacts associated with the
conventional power plants. It was
mentioned that the conventional power
planning look at demand as a variable that
is exogenous and uncontrollable. He
stressed the need to look at options like Demand side management (DSM) and other load
management techniques as ways to coordinate with their customers to reduce their load. The
need to redefine and restructure the role of utilities as an entity that provides reliable and
affordable energy services to their customers rather than just electricity was also pointed out.
The benefits and ways of providing energy services to the customers in efficient fashion
were discussed. The benefits of integrating renewable system with DSM were analysed. He
laid out the vision and roadmap in the form of a set of recommendations to carry forward
DSM initiatives to a larger scale. These recommendations can be found in the draft report.
Open Discussion: Scaling Up Utility Driven DSM programs in India.
The session was moderated by Prof. Rangan Banerjee and two major discussion agendas
surfaced out that involved interaction between Dr. Ajay Mathur and the representatives
from the community of ESCO, regulators , SDA & utilities. The two agendas or issues that
took major portion of the open discussion session have been detailed as follows:
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1. Availability of consumer data for third party analytics and the issues involved.
Mr Sandeep Garg raised a point that all utilities have started collecting customer data
through the metered network. This data
resides with the utilities serving no value
as it is not accessible to parties that may
be interested in analysing it and provide
inputs on designing right kind of DSM
programs at required scale. Mr Anish
Garg mentioned that data with the
public utilities at aggregate level is
available in the ARR petitions which are filed by the utilities to the regulator and also in the
tariff orders that are issued by the regulators. He also added that private utilities also feel
wary to share their feeder data as they fear that cherry picking could be there by private
entrepreneurs. Dr. Ajay Mathur
suggested that the only way out in
current scenario is to carry out the data
analytics and research in the utility itself.
He mentioned that the customer bill is
not a public document and data sharing
beyond customer and utilities is not
justified. He stressed at the need to
define the level of aggregation at which
data can be shared without infringing on confidentially and privacy. In some cases, there is
cost involved to collect data from the customers. He enumerated the three objectives that
create the need to collect data. First is to enable commercial transactions i.e. billing or
payments (in case of DSM). Second objective is to enable forward planning. Finally it is also
needed for the purposes of legal requirements as in case of PAT programs where it is
required for designated consumers to keep their specific energy consumption beyond a
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certain limit. Hence it is crucial to identify who has access to data and the level at which
access can be provided. Data collection needs to be done for carrying out load research in
order to know where DSM intervention makes sense. He stressed the need to focus on
conservative data, making programs on loss reduction or peak load reduction and ensuring
that a range of technical inputs either in the form of technology changes or Demand
response strategies to allow Demand side energy use to reduce as a result of interventions
carried out by the utility.
The possibility of a centralized hot water system using electricity based heat pumps in large
storeyed vertical buildings where space is a constraint to install solar based water heaters was
also discussed.
It was also suggested that the focus should also be on the use of micro irrigation techniques
apart from energy efficient pumps as the former targets efficient water use in the agriculture.
2. DSM financing options and bottlenecks for utility driven programs.
Prof. Rangan Banerjee raised the issue of availability of finance for DSM and asked the
forum if there can be a low interest line of funding that is provided with some kind of
support from the government by
allocation of funds to lower the cost
of finance. The issue of ensuring
the security of investment for DSM
was also deliberated and the need to
lay down specific guidelines for
repayment of money post
implementation was also put
forward.
Dr Ajay Mathur mentioned that currently something in order of 400,000 to 800,000 crore is
being invested in energy efficiency projects which account for almost 5% of the total
investment in the country. Investment doesn’t occur in DSM projects for agriculture,
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municipality and SMEs for a variety of reasons including lack of incentive in agriculture
projects, bad financial health of
municipalities and issue of health
of SMEs in the country. In the
context of Utility based DSM
where resources are met through
regulated payments, it is difficult
to expect from loss making
utilities to invest in DSM because
it makes financial sense for them.
There is neither an appetite in the
regulators nor government to go for a price shock in tariff. So, there exists a constraint to
increase the tariff rates to get revenue to invest in DSM. ESCO model can be way to
implement utility based DSM projects but that would mean looking out ways to create a
pool of capital for ESCOs and methodologies to ensure repayment of funds. There exists a
partial risk guarantee fund that can make 50 % of the non-repayment to the financial
institution which lends to ESCOs. There is also a possibility to use resources received in
National Clean Energy fund to bring down the cost of capital or DSM financing.
He suggested that there is a parallel need to devise ways to reduce transaction costs for the
DSM projects using better methodologies to tackle the problem of unavailability of funds.
Summary and Future course of action
Dr. Ajay Mathur reiterated that utility based DSM can be an effective measure to increase
the end-use efficiency. The key challenge lies in getting the DISCOMs to have both the
alignment of interest and the necessary capacity to be able to design and implement DSM
programs. He suggested that the draft report presented during the workshop and the open
discussion brought out that there is a lot of action in DSM space. It is crucial to collect and
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disseminate experiences from these implemented DSM projects so as to learn the various
issues involved and figure out the possible ways out for future DSM implementation.
Vote of thanks by Prof. Suryanarayana Doolla
The workshop concluded with a vote of thanks from Prof. Suryanarayana Doolla. He
thanked all the participants on behalf of IIT Bombay and Shakti Foundation that they spared
a day from their busy schedule to attend the workshop. He also asked the participants to
spare some time and send their comments and feedback on the draft report.
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Annexure 1: Concept Note
Energy Efficiency and Demand Side Management (DSM) have significant potential in India.
The need for affordable electricity and the energy and peak shortages make DSM important
for India. Recognizing the importance of DSM to energy sustainability and carbon emission
reductions, Indian Institute of Technology Bombay partnered with Shakti Sustainable
Energy Foundation to initiate research for technology and landscape assessment of DSM
programs and reviewed strategies being practiced in the country.
A stakeholder workshop was conducted at IIT Bombay in December, 2013, to identify the
issues and barriers to DSM in the country (www.ese.iitb.ac.in/~suryad/Workshop1.pdf )
followed by a training workshop at Lucknow in April 2014 as a capacity building initiative.
During the April workshop, UPERC launched the DSM regulations in the state. The
workshops helped in identifying the best practices in DSM and bringing together the experts
practicing engineers and regulators.
The inputs obtained from distribution companies, utilities and regulators and a mapping of
the technology assessment and landscape assessment for DSM has been completed. The
draft report will be presented and a roadmap for DSM in the country proposed.
It is expected that key national and state decision makers would participate in this workshop,
provide their feedback and suggestions for creating a roadmap for scaling DSM so that it can
help in providing affordable and sustainable power for the future.
Date: 28th June, 2014
Venue: Hotel Le Meridien, New Delhi
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Annexure 2: Workshop Program
9:30 to 10:00 am Registration and Networking Tea
10:00 to 10:45 am
Inauguration: Shri. Gireesh Pradhan, Chairman, Central Electricity Regulatory Commission Dr. Ajay Mathur, Director General, Bureau of Energy Efficiency Introduction about SSEF Natasha Bhan, Shakti Sustainable Energy Foundation
10:45 to 11:00 am Tea Break
11:00 to 11:45 am Demand Side Management in India
Landscape Assessment
Technology Assessment
Vision and Roadmap Prof. Rangan Banerjee &Prof. Suryanarayana Doolla
11:45 to 12:45 pm Open/Panel Discussion – Scaling up of Demand Side Management in India: Role of Regulatory Commission, Utilities, Consultants and Consumers
12:45 to 1:00 pm 1. Summing up and Future Course of Action
2. Vote of Thanks
1:00 to 2:00 pm Networking Lunch
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Annexure 3: List of Participants
S. No Name Organization Email ID
1 Shri Gireesh B. Pradhan CERC [email protected]
3 Shri Ajay Mathur BEE [email protected]
4 Mr. Saurabh Kumar EESL [email protected]
5 Mr. Anish Garg JERC [email protected]
6 Mr. K.M. Dharesan Unnithan
EMC, Kerala [email protected]
7 Mr. Dharmendra R Parmar
GERC, Gujarat [email protected]
8 Mr. J B V Reddy DST, New Delhi
11 Mr. Rajendra N. Pandya GEDA, Gujarat [email protected]
12 Mr. Vipin Rohilla National Productivity Council, Mumbai
13 Mr. Sai Pranith IIT Delhi [email protected]
14 Mr. Ganesh Das Tata Power, New Delhi
17 Mr. Amol Bhutad Tata Power, Mumbai
19 Mr.Mohan S.Iyer Unidyne Energy [email protected]
20 Mr. Kartar Hemrajani Unidyne Energy [email protected]
21 Mr. Rohan Chopra Honeywell, Gurgaon
22 Mr. H V Shah MGVCL, Gujarat [email protected]
23 Mr. N P Bhatt MGVCL, Gujarat [email protected]
23 Ms. Varalika Dubey UPPCL, Lucknow [email protected]
24 Mr. Aditya Shankar Honeywell, Mumbai
25 Mr. Anand Mudgalkar MSEDCL [email protected]
26 Mr. Sandeep Garg EESL [email protected]
27 Ms. Neelima Jain EESL [email protected]
28 Mr. Reji Kumar Pillai ISGF [email protected]
29 Mr. K.Srinivasa Rao NREDCAP [email protected]
30 Mr. D V Prasad NREDCAP [email protected]
31 Mr. Imran Khan Siemens Ltd, Gurgaon
32 Mr. Vikram Gandotra Siemens Ltd, [email protected]
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Gurgaon
33 Mr. Parmanand Singh BERC, Patna [email protected]
34 Mr. K N hemanth kumar
Copper Alliance, Mumbai
35 Dr. Sunil Bhat VNIT, Nagpur [email protected]
36 Ms. Mrudula Kelkar Prayas Energy Group,
37 Mr. Krishna Kant Gupta
Idam Infra [email protected]
38 Mr. Rahul Yenumala MP Ensystems [email protected]
39 Mr. Ajeet Kumar Singh Larsen & Toubro Ltd.
40 Er. R.P.Singh PVVNL, Meerut [email protected]
41 Ms. Reshmi Vasudevan AEEE [email protected]
42 Dr. Koshy Cherail AEEE [email protected]
43 Mr. K. Raghu
People's Monitoring Group on Electricity Regulation
44 Mr. Rajeev Jain DVVNL [email protected]
45 Mr. Dipak H Kokate MSEDCL [email protected]
46 Mr. Vishal Goyal AEEE [email protected]
47 Mr. Devesh Kumar Jha Alstom T&D India Limited
48 Mr. S.K. Bhardwaj Uttar Haryana Bijli Vitran Nigam
49 Dr. Mahesh Patankar MP Ensystems [email protected]
50 Mr. Shresth Srivastav IIEC [email protected]
51 Prof. Suryanarayana Doolla
IIT Bombay [email protected]
52 Prof. Rangan Banerjee IIT Bombay [email protected]
53 Mr. H S V S Kumar IIT Bombay [email protected]
54 Mr. Amit Singh IIT Bombay [email protected]
55 Ms. Natasha Bhan Shakti Foundation [email protected]
56 Ms. Vrinda Sarda Shakti Foundation [email protected]
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Workshop Group Photograph