prospects of t & d equipment manufacturing in india

SUMMER TRAINING REPORT

On

PROSPECTS OF TRANSMISSION & DISTRIBUTION EQUIPMENT MANUFACTURING IN INDIA

Exploring the Business Opportunity in Manufacturing Sector

At

Feedback Infrastructure Services Private Limited

JUNE-JULY, 2012

Under the Guidance of

Mr. ANURAG RAIZADA

Principal Consultant, Energy Division

Feedback Infrastructure Services Private Ltd.

Mr. J. S. S. RAO

Principal Director

National Power Training Institute

Prepared By

ABHINAV GUPTA

Roll No. 1120812182

MBA - Power Management, Batch: 2011-13

NATIONAL POWER TRAINING INSTITUTE (NPTI), Faridabad

Submitted to

MAHARISHI DAYANAND UNIVERSITY, ROHTAK

DECLARATION

I, ABHINAV GUPTA, Roll No. 1120812182, student of MBA-Power Management (2011-13)

at National Power Training Institute (NPTI), Faridabad hereby declare that the Summer Training

Report entitled

“PROSPECTS OF TRANSMISSION & DISTRIBUTION EQUIPMENT

MANUFACTURING IN INDIA”

is an original work and the same has not been submitted to any other institute for the award of

any other degree.

A Seminar presentation of the Training Report was made on 29 th August, 2012 and the

suggestions as approved by the faculty were duly incorporated.

Presentation In-Charge Signature of the Candidate

(Faculty)

Countersigned

Director/Principal of the Institute

ii

ACKNOWLEDGEMENT

It’s my immense pleasure to present this report under the subject of ‘Prospects of Transmission

& Distribution Equipment Manufacturing in India’. I take this opportunity to express my

gratitude to the people who have been instrumental in the successful completion of the project.

I would like to express my sincere gratitude to Mr. Devtosh Chaturvedi, Director, Energy

Division and Mr. Anurag Raizada, Principal Consultant, Energy Division of Feedback

Infrastructure Services Private Limited for giving me an opportunity to work under their

guidance and a rare chance to work on a prominent project.

I would like to express my heartiest thanks to Mr. Dilip Behera, Consultant, Energy Division,

Feedback Infrastructure Services Private Limited for giving me a chance to work with him,

providing me with the necessary resources, ideas and facilitating me in this project.

I am also thankful to Mr. J.S.S. Rao, Principal Director, CAMPS (NPTI); Mr. S.K. Chaudhary,

Principal Director, CAMPS; Mrs. Manju Mam, Dy. Director, NPTI; Mrs. Indu Maheshwari, Dy.

Director, NPTI; for arranging my summer internship at Feedback Infrastructure Services Private

Limited. It’s my privilege to have Mr. J.S.S. Rao, Principal Director, CAMPS (NPTI) as my

internal project guide. He has been a constant source of motivation and guidance throughout

the course of my internship.

I also extend my thanks to all the faculties and my batch mates in CAMPS (NPTI), for their

support and guidance throughout the course of internship.

ABHINAV GUPTA

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TABLE OF CONTENTS

Sr. No. CONTENTS Page No.CERTIFICATE FROM INDUSTRY iDECLARATION iiACKNOWLEDGEMENT iiiTABLE OF CONTENTS ivLIST OF FIGURES viLIST OF TABLES viiABBREVIATIONS ixEXECUTIVE SUMMARY x

1 INTRODUCTION 11.1 Transmission & Distribution Equipment Industry 11.2 Problem Statement 21.3 Objective 21.4 Organization Profile 2

2 LITERATURE REVIEW AND RESEARCH METHODOLOGY 52.1 Literature Survey 52.2 Research Methodology 6

3 SCENARIO OF POWER SECTOR IN INDIA 73.1 Indian Power Sector 73.2 Power Sector Performance in 11th Plan 8

3.2.1 Capacity Addition: Generation 83.2.2 Transmission System in India 93.2.3 Capacity Addition: Transmission Lines 103.2.4 Capacity Addition: EHV Substations 123.2.5 Performance of Distribution Sector 143.2.6 Technological Development 16

3.3 Transmission & Distribution Sector in 12th Plan 183.3.1 Envisaged Growth in 12th Plan 183.3.2 Addition of Transmission Lines 203.3.3 Addition of Substations 213.3.4 Development of National Grid: Inter-State Transmission Capacity 223.3.5 Growth of Distribution Business 23

4 INDIAN ELECTRICAL T&D EQUIPMENT INDUSTRY 284.1 Industry Scenario 284.2 Cable & Conductor 30

4.2.1 Cable 304.2.2 Types of Cable 304.2.3 Conductor 314.2.4 Types of Conductor 314.2.5 Competitor Analysis 324.2.6 Financial Analysis 344.2.7 Industry Performance 354.2.8 Market Prospects 36

4.3 Transmission Tower 38

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4.3.1 Types of Transmission Tower 394.3.2 Competitor Analysis 414.3.3 Financial Analysis 454.3.4 Industry Performance 464.3.5 Market Prospects 47

4.4 Switchgear & Control Instruments 484.4.1 Constituents of Switchgear 484.4.2 Competitor Analysis 514.4.3 Financial Analysis 574.4.4 Industry Performance 574.4.5 Demand Segments 584.4.6 Market Prospects 60

4.5 Transformer 604.5.1 Major Components of Transformer 614.5.2 Market Analysis 644.5.3 Competitor Analysis 674.5.4 Financial Analysis 734.5.5 Growth in Market Size 734.5.6 Prospective Clients 744.5.7 Business Risk 75

4.6 Energy Meter 754.6.1 Types of Energy Meter 764.6.2 Competitor Analysis 804.6.3 Industry Performance 834.6.4 Market Prospects 84

5 CHALLENGES AND ISSUES 875.1 Increasing Imports: A Major Challenge 875.2 Critical Issues 88

6 CONCLUSION AND RECOMMENDATIONS 906.1 Business Opportunities 906.2 Cables 906.3 Conductors 906.4 Transmission Towers 916.5 Switchgears & Controls 916.6 Transformers 926.7 Energy Meters 92

BIBLIOGRAPHY AND REFERENCES 94ANNEXURE - I 96ANNEXURE – II 97

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LIST OF FIGURES

NAME OF FIGURE Page No.Figure 1: Per Capita Yearly Electricity Consumption 8Figure 1: Trend in Transmission Line Growth 11Figure 2: Voltage Segmentation in Growth of Transmission Lines 12Figure 3: Trend in Substation Capacity Growth 13Figure 4: Voltage Segmentation in Growth of Substation Capacity 14Figure 5: AT&C Loss: Past Performance and Future Expectations 15Figure 6: Infrastructure Addition in 11th Plan 18Figure 7: Structure of T&D Network Planning 18Figure 8: Sourcing of Financial Investment 19Figure 9: Transmission Line Length (Ckm): Share of Voltage Level in Different Plans 20Figure 10: Substation Capacity (MVA): Share of Voltage Level in Different Plans 21Figure 11: Cumulative Growth of Inter-State Transmission Capacity (MW) 22Figure 12: Growth of T&D Lines below 66 kV 23Figure 13: Growth of (All) T&D Equipments Industry in India 28Figure 14: Growth of Major T&D Equipments in India 29Figure 15: Cable 30Figure 16: Cross Sectional View of Three Core Belted Cable 31Figure 17: Aluminum Conductor 31Figure 18: ACSR Conductor 31Figure 19: Cable Industry: Past Performance and Expected Market Size 37Figure 20: Conductor Industry: Past Performance and Expected Market Size 37Figure 21: Cable & Conductor: Export Trend 38Figure 22: Transmission Tower 39Figure 23: Waist Type Tower 40Figure 24: Double Circuit Tower 40Figure 25: Steel Tubular Pole 40Figure 26: Guyed-V Tower 41Figure 27: Tower Industry: Past Performance and Expected Market Size 47Figure 28: Switchgear: Circuit Breaker 48Figure 29: Oil Circuit Breaker 48Figure 30: Voltage Circuit Breaker 49Figure 31: Gas Circuit Breaker 50Figure 32: Current Transformer 51Figure 33: Voltage Transformer 51Figure 34: Export of Switchgear Instruments 58Figure 35: Switchgear Industry: Past Performance and Expected Market Size 60Figure 36: Transformer 61Figure 37: Transformer Windings 61Figure 38: Core 62Figure 39: Conservator Tank 62Figure 40: Radiator 62Figure 41: Buchholz Relay 63Figure 42: Bushings 63

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Figure 43: Demand Drivers fo Transformer 65Figure 44: Transformer Industry: Past Performance and Expected Market Size 74Figure 45: Energy Meter 75Figure 46: Electromechanical Meter 76Figure 47: Electronic Meter 77Figure 48: HTMD Meter 77Figure 49: Apex Meters 78Figure 50: LTCT Meter 78Figure 51: LT Whole Current Meter 79Figure 52: Prepaid Meter 79Figure 53: Running Cycle of Prepaid Meter 80Figure 54: Export of Electrical Meters 84Figure 55: Metering Industry: Past Performance and Expected Market Size 86Figure 56: CHINA: Import Trend of Electrical Equipments 87Figure 57: KOREA: Import Trend of Electrical Equipments 88

LIST OF TABLES

NAME OF TABLE Page No.Table 1: Snapshot: Indian Power Sector 7Table 1: Planwise Generation Capacity Addition 9Table 2: Growth of Transmission Lines (Ckm) 10Table 3: Growth of Substation Capacity (MVA) 13Table 4: 12th Plan: Investment Layout in Power Sector 19Table 5: Planned addition of Transmission Lines (Ckm) in 12th Plan (2012-2017) 20Table 6: Planned Addition of Substation Capacity in 12th Plan (2012-2017) 22Table 7: Distribution Sector: Network Enhancement in 12th Plan 24Table 8: AT&C Losses: Projected Performance 25Table 9: Transmission & Distribution Equipments 28Table 10: Sterlite Technologies Limited 32Table 11: JSK Industries Pvt. Limited 32Table 12: Diamond Power Infrastructure Limited 33Table 13: Deepak Cables (India) Limited 33Table 14: KEC International 34Table 15: Competitor Performance 34Table 16: Performance of Cable & Transmission Line Industry 35Table 17: Strategic Analysis 36Table 18: Voltage Segmentation of Power System 38Table 19: Kalpataru Power Transmission Limited 41Table 20: IVRCL 41Table 21: KEC International 42Table 22: Diamond Power Infrastructure Limited 42Table 23: Jyoti Structures Limited 43Table 24: Gammon India Ltd 43Table 25: Unitech Power Transmission Ltd 44

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Table 26: Aster Private Ltd 44Table 27: Man Structurals Pvt. Ltd 45Table 28: Competitor Performance 45Table 29: Performance of Transmission Line Industry 46Table 30: Strategic Analysis 46Table 31: Bharat Heavy Electricals Limited (BHEL) 51Table 32: Siemens India Limited 52Table 33: ABB Limited 53Table 34: Crompton Greaves Limited 53Table 35: Alstom (Areva) T&D India Limited 54Table 36: Biecco Lawrie Limited 55Table 37: Jyoti Limited 55Table 38: Vishal Transformers & Switchgears (P) Ltd 55Table 39: Heptacare Power Industries Pvt. Limited 56Table 40: Hivoltrans Electricals Pvt. Ltd 56Table 41: Kappa Electricals 57Table 42: Competitor Performance 57Table 43: Performance of Switchgear Industry 58Table 44: Strategic Analysis 59Table 45: Types of Transformer 61Table 46: Transformer: Domestic Demand Vs Supply 64Table 47: Performance of Transformer Industry 65Table 48: Transformer: Demand Creators 66Table 49: Transformer Exports from India 66Table 50: Transformer Industry: Prominent Players 67Table 51: Bharat Heavy Electricals Limited (BHEL) 67Table 52: Siemens India Limited 68Table 53: ABB Limited 68Table 54: Crompton Greaves Limited 69Table 55: Alstom (Areva) T&D India Limited 70Table 56: Transformers & Rectifiers 71Table 57: Vijai Electricals 71Table 58: Voltamp 71Table 59: Bharat Bijlee 72Table 60: EMCO 72Table 61: Competitor Analysis 73Table 62: Genus Power Infrastructures Ltd 80Table 63: Secure Meters Limited 81Table 64: L&T Limited (Electrical & Automation Division) 82Table 65: ECE Industries Limited 82Table 66: HPL Metering Pvt. Ltd 83Table 67: Capital Power Systems Ltd 83Table 68: Performance of Metering Industry 84Table 69: Strategic Analysis 85

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ABBREVIATIONS

ABC Areal Bunched Conductor IPTCIndependent Power Transmission Company

ACA Additional Central Assistance IS Indian StandardACAR Aluminum Core Alloy Reinforced ISTS Interstate Transmission SystemACS Average Cost of Supply I-STS Intra-State Transmission SystemACSR Aluminum Core Steel Reinforced JV Joint VentureAMR Automatic Meter Reading kV Kilo VoltARR Average revenue Realized kWh Kilowatt Hour

AT&CAggregate Technical & Commercial Losses

LCD Liquid Crystal Display

ATO Annual Turn Over LTCT Low Tension Current TransformerCAGR Compound Annual Growth Rate LV Low VoltageCEA Central Electricity Authority MCB Miniature Circuit BreakerCkm Circuit Kilometer MCCB Molded Case Circuit BreakerCRGO Cold Rolled Grain Oriented MV Medium VoltageCT Current Transformer MVA Mega Volt AmpereCTU Central Transmission Utility MW Mega WattCVD Counter Veiling Duty OCB Oil Circuit BreakerDISCOM

Distribution Company PGCIL Power Grid Corporation of India Limited

DT Distribution Transformer R&D Research & DevelopmentED Energy Division R-APDRP Restructured-APDRD

EE Electrical Equipment RGGVYRajiv Gandhi Gramin Vidyutikaran Yojna

EHV Extra High Voltage RoW Right of WayEPC Engineering, Procurement, Construction SAD Special Additional Duty

EU European Union SCADASupervisory Control And Data Acquisition System

FY Financial Year SEB State Electricity BoardFYP Five Year Plan STU State Transmission UtilityGENCO Generation Company T&D Transmission & DistributionGIS Gas Insulated Switchgear ToD Time of DayHCTC High Capacity Transmission Corridor TRANSCO Transmission CompanyHTMD High Tension Maximum Demand UHV Ultra High VoltageHVAC High Voltage Alternating Current VCB Vacuum Circuit BreakerHVDC High Voltage Direct Current VT Voltage TransformerHVDS High Voltage Distribution System WC Whole CurrentIEEMA Indian Electrical Equipment XLPE Cross Link Poly Ethylene

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Manufacturing AssociationINR Indian Rupees YoY Year on Year

x

EXECUTIVE SUMMARY

Indian Power Sector has witnessed the robust growth during the 11 th Five Year Plan. Power

generation capacity of 53,000 MW has been added in 11th Plan which is ever highest among any

five year plan. The focus of investments in the Indian Power Sector has typically been on the

generation segment, while the importance of Transmission and Distribution segment has always

been undervalued. During 11th Plan, about 55% of total investment in the power sector was in the

generation segment, 15% in transmission and 30% in distribution. This investment pattern needs

to be revised. Investment in the generation, transmission and distribution segments should ideally

be in the ratio of 2:1:2. During the 12th plan, 47% of the total investment in the sector has been

earmarked for the generation segment while the rest has been reserved for T&D and other

segments. Power transmission is the backbone of whole power system for any country. To

transmit more power from one end to another, even more robust and reliable network is required.

In India, voltage level at 220 kV and above is used for long distance power transfer. In the 11 th

Plan, focus has been to shift the operating transmission voltage level from 220 kV & 400 kV

towards 765 kV. Initial efforts in 1200 kV segment has also been made successfully. HVDC

transmission has emerged as more convenient way to transmit power for distance more than 800-

1000 km. Accordingly, availability of equipments of suitable voltage level have become prime

need of the time for the further development. Indian T&D equipment industry has grown faster

in 2009-10 and 2010-11 as compared to 2007-08 and 2008-09. It reflects high degree of

correlation between generation capacity addition activity and corresponding enhancement of

transmission & Distribution system.

In this development, now the importance of T&D manufacturing industry can not be subdued.

Balance between demand and; timely & cost effective supply of equipment affects the growth of

transmission & distribution network and hence connectivity between generator and the end

consumer. Today country’s major T&D equipment market has crossed the mark of INR 64,000

Crore. Indian T&D manufacturing industry comprises a mixture of around four hundred; Power,

Distribution and instrument transformer manufacturers, one hundred fifty switchgear

manufacturers, fifty energy meter manufacturers, seventy capacitor manufacturers, one hundred

fifty cable manufacturers and approx fifty insulator manufacturers.

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Overall, Indian T&D equipment manufacturing industry is able to cater the domestic demand.

Additionally, industry exports various kinds of equipments to the foreign market. This portfolio

especially comprises small & medium; power and distribution transformers, switchgears,

conductors etc. Import portfolio includes EHV cables, large transformers electric rotating

machines etc.

Although this industry is flooded with more than one thousand manufacturers yet most of the

market share is held by a few leading multinational players. It is mainly because of poor

attention on Research and Development to explore new technologies. Today, in spite of being

one of the largest markets in the world; domestic manufacturers are not able to fulfill country’s

demand of equipments. In order to become self dependent, Indian Government has Vision 2022

set for Indian Electrical Equipment Industry to make India the country of choice for the

production of electrical equipment and reach an output of INR 5 Lakh Crore by balancing

exports and imports. To achieve the vision, concerted efforts by all stakeholders including

government, industry and industry association, needs to be deployed.

According to Indian Electrical Equipment Manufacturing Association (IEEMA) which consists

95% of Indian Manufacturing Companies; performance of industry has remained average

compared to last year. Cable and Energy Meter industry has been able to lead the industry in

2011-12.

Equipment CategoryMarket Size in 2011-12

(INR Crore)Growth in 2011-12 (YoY) CAGR (11th Plan)

Cables 19,496 25.7% 14.5%

Conductors 5,914 4.3% 5.9%

Transmission Towers 6,257 -5.2% 6.4%

Switchgears 8,882 -2.4% 7.9%

Transformers 12,498 1.2% 5.5%

Capacitors 506 -1.8% 10.8%

Energy Meters 2,387 6.1% 5.8%

Rotating Machines 6,373 1% 5.5%

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Although Year on Year (YoY) basis, growth rate at 6.6% in 2011-12 half as compared to 13.7%

in 2010-11 yet over the last five years industry size has increased at a CAGR of 8.5%. It is a sign

of long term growth of the equipment industry.

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CHAPTER - 1

INTRODUCTION

1.1 Transmission & Distribution Equipment Industry

The process of power generation and its eventual transmission and distribution (T&D) can be

compared to the process by which food grains are supplied to cities from the places where they

are produced and stored. Even if the warehouses are full with food grains, the transport

infrastructure should be in good condition for the food grains to reach the end-users. If transport

infrastructure is inefficient and inadequate, it not only results in to supply shortage but also leads

to wastage during transport. In case of power, generation capacity is the warehouse and T&D

infrastructure plays the role of transport facility.

Considering the rapidly increasing demand of power in country, massive generation capacity is

planned to fulfill this demand. At the same time, huge investment is required in building up the

T&D infrastructure so as to ensure efficient supply of power. The power transmission and

distribution equipment industry is a critical part of the Indian power sector. Power generation is

key growth-driver for the equipment manufacturing industry.

In India, power transmission equipment companies include those who manufacture transmission

lines and towers, substations, equipments like transformers, reactors and electrical equipments

like electrical meters and metering solutions. Indian T&D equipment market is fragmented. It is

characterized by the presence of a number of small and medium enterprises yet some major

players dominate the market share. These companies do their business through different routes

available in the market. In an EPC contract route, the EPC contractor (EPCC) agrees to deliver a

completely commissioned plant to the owner for an agreed amount. This is just as a builder who

hands over the keys of a fully furnished flat to a purchaser. Transmission equipment companies

that are in the business of setting up transmission lines and towers; and substations follow the

EPC route wherein they take up turnkey projects. Companies that deal in manufacturing

transformers and electric meters, directly sell them to Power Grid Corp (PGCIL), State

Electricity Boards (SEB’s) and other private distribution companies.

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1.2 Problem Statement

The electrical T&D equipment industry in India has a long history. Clocked at 6.6% growth in

the FY 2011-12, it covers over 1,500 units of varying sizes, amounting for an annual turnover of

about INR 64,000 Crores. It amounts for more than INR 20,000 Crores of annual exports and

above INR 32,000 Crores of annual imports; it has a negative trade balance which has been

increasing in recent times.

In spite of increasing imports, this industry has a very good potential for domestic as well as

export market in most of the developing and some of the developed countries. But matter is the

correct assessment of the market and selection of right equipment segment to enter in the

manufacturing business.

1.3 Objective

The objective of this report is as under

i) Analyzing the performance of Indian Electrical T&D equipment industry during last five to

ten years and current status.

ii) Analyzing the prospects and growth drivers of T&D equipment industry in next five to ten

years in India.

iii) Identification of equipment segment and exploring the business opportunity for a new entrant

in the market.

1.4 Organization Profile

Feedback Infrastructure Services Private Limited, more commonly known as Feedback Infra, is a

leading professional and technical services company in the infrastructure sector in India. From

concept to commissioning, Company offers an integrated suite of services across all sectors of

infrastructure.

Headquartered in Gurgaon, Feedback Infra has 5 regional offices and 70 project offices

nationally. Besides India, Feedback has projects in Afghanistan, Africa, Australia, Bangladesh,

Bhutan, Europe, Indonesia, Malaysia, Middle East, Nepal, Singapore, Sri Lanka and Syria.

xv

Feedback Infra is enabled by a large pool of multidisciplinary experts; cutting-edge functional

and domain knowledge; an all-India network of offices; and a strong shareholding — L&T,

IDFC, and HDFC.

The Various sectors are Transportation & Logistics, Energy, Housing & Townships, Commercial

Infrastructure, Industrial Infrastructure, Water & Sanitation, Retail & Entertainment, Healthcare,

Hospitality, Urban Development and Special Economic Zones

Feedback is presently working on more than 35,000 MW of new power generation capacity;

20,000 km of National and State Highways; 100,000 acres of real estate development and a

building area of more than 22 million square feet.

Energy Division (ED) is an integral part of the energy and fuel landscape in India, handholding

utilities through the reform and re-structuring process and introducing and guiding private

investments in the sector. From, identifying and evaluating business opportunities, structuring of

projects, representing the clients in the financial and power markets, providing implementation

support and performance management capabilities, Feedback Infra has built valuable

relationships with utilities; Indian and global energy majors and with individual captive plants.

Its services range from policy framework creation addressing sectoral issues, to project-driven

customized services meeting specific needs of the client.

In generation, Energy Division (ED) offers coal and IPP entry strategies, tariff studies, project

structuring, business plans and long-term fuel strategy procurement.

In transmission, ED offers transmission service agreements, cost of service, energy accounting at

the SLDC level, merit and UI trade analysis and grid support changes.

In distribution, the division conducts the valuation of an existing business, a “go-no-go” analysis,

set up distribution franchisees, offer tariff rationalization, ways to enhance revenues, reduce

T&D losses and costs of service.

In the regulatory area, ED assists with the ARR filings, review of regulations and regulatory

comparison, open access regulations and PPA renegotiations.

xvi

In the renewable area, ED provides strategic advisory services through the entire project cycle -

from site evaluation to post commissioning support; including assessment of business models,

technology issues, policy and regulatory factors.

In the energy efficiency space, ED enjoys a strong domestic and an evolving international

presence. As a Grade-II ESCO, it goes beyond providing traditional advisory or engineering

design services - offering guaranteed energy conservation solutions and project

development/management services to the household, industry, commercial and rural sector.

In the information technology space, ED is a leader in providing IT solutions to the Power

Distribution utilities and has undertaken IT assisted performance improvement for utilities across

the country. The Division is also moving into the Smart Grid arena with international

accreditations under its belt.

xvii

CHAPTER – 2

LITERATURE REVIEW AND RESEARCH METHODOLOGY

2.1 Literature Survey

The global electrical equipment industry consists of the following two segments:

i) Global heavy electrical equipment market — power generating equipment, including wind

turbines, and other heavy electrical equipments such as power turbines, heavy electrical

machinery intended for fixed-use and large electrical systems.

ii) Global electrical components and equipment market — electric power cables, transformers

and electrical switchgear, transmission line towers, etc.

The global EE market is expected to increase from more than US$ 3 trillion (2008-15) to US$

6.8 trillion (2016-30). This translates into ~2% CAGR over the long term. Asia-Pacific and

Europe together account for more than 70% of the global market, with Asia- Pacific‘s share

being 45%. This region is expected to see the strongest demand in future due to the region‘s

strong expected economic growth rates.

Globally, growth rates have been less-than-impressive in recent years in the electrical equipment

market, but there is scope for expansion in certain geographical areas, such as the emerging

markets in the Asia-Pacific region. Robust economic growth in emerging countries such as China

and India, combined with rapid urbanization and strong growth in fixed investment spending in

these countries, is expected to boost the demand for electrical equipment in these countries.

A period of deregulation is being witnessed in the power sectors of most countries, with an

increase in the number of independent power distributors and operators who are capable of

supplying services at different points in the power sector value chain. In developed countries,

rising ecological concerns and investment in alternative sources of power generation should

benefit the heavy electric power equipment segment such as the wind turbines.

Global trade in EE products accounts for 3% of the overall trade. While global trade has grown

at 5.2% CAGR (2006-10), while trade in EE has grown by 5.8% over the same period, thus

increasing its share in the global trade. Global trade in EE has reached US$ 453 billion in 2010,

xviii

with China being the leading exporter of electrical equipment with over 15 percent share. India

accounts for less than 1% of the total share of exports. USA and China are the largest import

markets in the world for EE. India imports 2% of total EE trade of the world. India has a trade

deficit in EE trade, with imports higher than exports, consistently for the last many years.

Switchgears and rotating machines together cover ~36% of the trade market. China is the leading

exporter in rotating machines as well as transformers with more than 16% share, while India has

less than 2% share in global trade of these products. US is the largest importer of rotating

machines as well as transformers. China dominates trade in most of these product segments.

Segments such as rotating machines, transformers, lamps, cables are dominated by China with

double digit shares in global trade. Countries like Japan, US and Germany dominate trade in a

few segments like switchgears, insulators, capacitors etc.

2.2 Research Methodology

The project is based on the basic concept of research methodology. The following concepts are

directly or indirectly used while dong this project.

Collection of Data

Secondary source of data collection has been adopted. Sources of data have been the companies’

websites and different commercial & ministry websites.

Population

Prominent players in the manufacturing sector have been chosen from the population mean.

Analysis Pattern

Comparative analysis of different companies has been carried out.

xix

CHAPTER - 3

SCENARIO OF POWER SECTOR IN INDIA

3.1 Indian Power Sector

Indian power sector has witnessed a rapid growth in all verticals i.e. generation, transmission and

distribution. Generation sector which saw the fastest growth during last five years was followed

by transmission capability enhancement. On the third dimension, distribution sector has now

achieved the pace of reforms especially in last five years. Corrective measures taken after

economic crisis of 1991, whole power sector has proved to be a great opportunity; especially for

private players.

Table 70: Snapshot: Indian Power Sector

Area 32.8 Lakh sq kmPopulation (Census 2011) 1.21 BillionPer Capita Electricity Consumption

(2010-11) 814 kWh per annum

Installed Generation Capacity

205,340 MW(June 2012)

Thermal: 136,436 MWHydro: 39,291 MWNuclear: 4,780 MWRES: 24,833 MW

Installed Transmission Capacity

(May 2012)

Transmission Line Length EHV Substation CapacityTotal: 270,873 ckm Total: 420,561 MVA500 kV HVDC: 9,432 ckm 500 kV HVDC: 11,200 MW765 kV: 6,337 ckm 765 kV: 30,500 MVA400 kV: 114,277 ckm 400 kV: 152,342 MVA220 kV: 140,827 ckm 220 kV: 226,519 MVA

Unbundled Discoms (2000-11) 73Average AT&C Losses (2009-10) 27.15%Electrified Villages Up to 11th Plan 90%

Source: CEA, Planning Commission

The power generation capacity added in the 11 th Plan, which ended in March 2012, was around

53,000 MW. It is close to 68% of the originally projected addition (78,700 MW during the plan

period). But the capacity addition achieved is no mean accomplishment, given that the quantum

is similar to what the country had added in the previous three Five-Year Plans (15 years ended

March 2007). In fact, 20,501 MW of addition last fiscal was the highest for any year and is close

to 21,180 MW added in the whole of 10 th Plan period (2002-07). Increasing population,

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improving lifestyle, developing infrastructure and growth has led the higher demand of power.

Consistent increase in per capita annual electricity consumption is reflected by growth in power

sector. Elasticity between the overall growth of the country and that of power sector has been in

the range of 0.8 to 0.9.

The investment climate is very

positive in the power sector. Due to

policy liberalization, the power sector

has witnessed higher investment flows

than envisaged. The power ministry

has set a target for adding 76,000 MW

of electricity generation capacity in

the 12th Plan (2012-17) and 93,000

MW in the 13th Plan (2017-2022). The

Working Group on Power for

formulation of the 12th Plan has

estimated total fund requirement of INR 1,372,580 Crore for the power sector. During the 12 th

Plan, main sources of financing are commercial banks, public financial institutions, dedicated

infrastructure/power finance institutions, insurance companies, overseas markets,

bilateral/multilateral credit, bond markets and equity markets. In addition, steps have been taken

by government to make available funds through Credit Enhancement Schemes and Infrastructure

Debt Fund etc.

3.2 Power Sector Performance in 11th Plan

3.2.1 Capacity Addition: Generation

11th Plan has emerged as the best inception period for private companies. On a positive note, the

better execution capabilities of private players came forth in the last FYP. Approx 23,000 MW of

capacity is added by the private sector during the 11th plan. Much of the capacity addition was

again through the thermal route. The working group envisages more than 40,015 MW of 76,000

MW of capacity to be added by private players in the current plan (ended 2017).

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2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

2010-11

0

100

200

300

400

500

600

700

800

900

566.

7 592

612.

5

631.

5

671.

9 717.

1

734.

5 779 81

4

kWh

(Uni

t)

Source: CEA

Figure 58: Per Capita Yearly Electricity Consumption

Table 71: Planwise Generation Capacity Addition

Plan Central Sector State Sector Private Sector TotalTarget Actual Target Actual Target Actual Target Actual

7th Plan 9,320 9,534.5 12,925 11,867 0 0 22,245 21,406% Achievement 102% 92% 0% 96%

8th Plan 12,858 8,157 14,870 6,835 2,810 1,430 30,538 16,423% Achievement 63.4% 46% 60% 54%

9th Plan 11,904 4,504 10,748 9,353 17,589 5,262 40,245 19,119% Achievement 37.8% 87% 30% 48%

10th Plan 22,832 13,005 11,157 6,245 7,121 1,931 41,110 21,180% Achievement 57% 56% 27% 52%

11th Plan 21,222 15,220 21,355 16,732 19,797 23,013 62,374 54,964% Achievement 71.7% 77% 118% 88%Source: CEA

3.2.2 Transmission Systems in India

The transmission systems that are in place in the country consist of Inter-State Transmission

System (ISTS) and Intra State Transmission System (Intra-STS).

Inter-State Transmission System (ISTS)

ISTS is mainly owned and operated by Power Grid Corporation of India Limited

(POWERGRID) which is also Central Transmission Utility (CTU). In future, Inter State

Transmission System (ISTS) schemes would be built through competitive bidding and many

private sector entities would own and operate the ISTS elements. Already, various ISTS schemes

owned by the private sector or joint venture (JV) between private sector and POWERGRID are

under construction. The ISTS serves the following purpose:

Evacuation of power from inter-state generating stations which have beneficiaries in more

than one state.

Onwards transmission of power to power from inter-state generation stations up to the

delivery point of the state grid.

Transfer of operational surpluses from surplus state(s) to deficit state(s) or from surplus

region(s) to deficit region(s).

Intra State Transmission System (Intra-STS)

xxii

Intra-STS within the state are mainly owned and operated by the state transmission utilities of

each state. The Intra-STS serves the following purpose:

Evacuation of power from generating stations having beneficiaries in the same state.

Power transmission within the State from ISTS boundary up to the various substations of the

state grid network.

Power transmission within the state grid for delivery to the load centre within the state.

3.2.3 Capacity Addition: Transmission Lines

A program for construction of 88,515 ckm transmission lines for evacuation of power from

generating stations as well as for strengthening of transmission network was envisaged at the

beginning of the 11th Plan corresponding to generation capacity addition program of 78,700

MW.

Table 72: Growth of Transmission Lines (Ckm)

At the end of 6th Plan 7th Plan 8th Plan 9th Plan 10th Plan 11th Plan(As on Mar-2012)±500 kV HVDC

Central 0 0 1,634 3,234 4,368 5,948State 0 0 0 1,504 1,504 1,504JV/Private 0 0 0 0 0 1,980Total 0 0 1,634 4,738 5,872 9,432

765 kVCentral 0 0 0 751 1,775 5,319State 0 0 0 409 409 411Total 0 0 0 1,160 2,184 5,730

400 kVCentral 1,831 13,068 23,001 29,345 48,708 75,974State 4,198 6,756 13,141 20,033 24,730 33,681JV/Private 0 0 0 0 2,284 8,443Total 6,029 19,824 36,142 49,378 75,722 11,3367

220 kVCentral 1,641 4,560 6,564 8,687 9,444 11,004State 44,364 55,071 73,036 88,306 105,185 128,823JV/Private 0 0 0 0 0 468Total 46,005 59,631 79,600 96,993 114,629 140,164Progressive Growth 52,034 79,455 117,376 152,269 198,407 Total# 268,693Source: CEA

xxiii

Subsequently, during the mid-term appraisal by the Planning Commission, generation capacity

target for the 11th Plan was scaled down to 62,374 MW. Accordingly, 68,673 ckm of

transmission line addition in the 11th Plan was anticipated during Mid-Term appraisal of the

Planning Commission. This comprises 2,773 ckm of 765 kV lines, 40,000 ckm of 400 kV lines,

24,300 ckm for 220 kV lines and 1600 ckm for HVDC lines. Against this program, actual

addition of transmission lines during 11th Plan was 75,148 ckm comprising of 3,546 ckm of 765

kV lines, 3,560 ckm of HVDC lines, 37,645 ckm of 400 kV lines and 25,535 ckm of 220 kV

lines.

During last six Five Year Plans country has added the transmission line at a CAGR of 39%. 11 th

Plan has witnessed the largest line addition of 75,148 ckm. Total length up to 11 th plan has been

38% more over the cumulative length up to 10th Plan. It is more than 1.62 times of the lines

added during 10th Plan. During last six FYP, transmission lines at the voltage level of 400 kV and

765 kV have grown at CAGR of 81% & 122% respectively. It indicates more focus towards

higher voltage level in order to minimize the transmission losses. Higher interest in HVDC

projects has been shown to overcome the limitation of AC transmission. In 11 th Plan private

players have entered in to this segment.

Figure 59: Trend in Transmission Line Growth

6th Plan 7th Plan 8th Plan 9th Plan 10th Plan 11th Plan0

50000

100000

150000

200000

250000

300000

52,034.000

79,455.000

117,376.000

152,269.000

268.693

268.693

CAGR: 39%

xxiv

Transmission lines at the voltage level of 220 kV has shown consistent average growth rate of

25% over last six FYP. Central Transmission Utility (CTU) i.e. Power Grid has made an

impressive addition of more than 12,000 MW in interregional transmission capacity. Hence total

interregional transfer capacity has reached up to 28,000 MW by the end of 11th Plan.

Figure 60: Voltage Segmentation in Growth of Transmission Lines


20000

40000

60000

80000

100000

120000

140000

160000

0 0 1634

4738

5872 94

32

0 0 0 1160

2184 57

30

6029

1982

4 3614

2 4937

8

7572

2

113.367

4600

5 5963

1 7960

0 9699

3 1146

29

140.164

±500 kV HVDC 765 kV 400 kV 220 kV

India is now looking at linking the transmission system with its neighboring countries Bhutan,

Nepal and Sri Lanka. There are also plans to develop an undersea HVDC transmission link

between Sri Lanka and India.

3.2.4 Capacity Addition: EHV Substations

A program of 157,691 MVA of transformation capacity corresponding to generation capacity

addition program of 78,700 MW was envisaged at the beginning of the 11th Plan. During the

mid-term appraisal by the Planning Commission, no revision in transformation capacity addition

program was indicated. Actual achievement of transformation capacity addition during 11th Plan

clocked at 153,362 MVA comprising of 25,000 MVA at 765 kV level, 3,000 MW of HVDC,

58,085 MVA at 400 kV level and 67,277 MVA at 220 kV level.

xxv

Table 73: Growth of Substation Capacity (MVA)

At the end of 6th Plan 7th Plan 8th Plan 9th Plan 10th Plan 11th Plan(As on Mar-2012)±500 kV HVDC

Central 0 0 0 3,500 6,500 9,500State 0 0 0 1,700 1,700 1,700JV/Private 0 0 0 0 0 0Total 0 0 0 5,200 8,200 11,200

765 kVCentral 0 0 0 0 0 24,000State 0 0 0 1,000Total 0 0 0 0 0 25,000

400 kVCentral 715 6,760 17,340 23,575 40,455 77,225State 8,615 14,820 23,525 36,805 52,487 73,172JV/Private 0 0 0 0 0 630Total 9,330 21,580 40,865 60,380 92,942 151,027

220 kVCentral 500 1,881 2,566 1,866 4,276 6,436State 36,791 51,861 81,611 113,497 152,221 215,771JV/Private 0 0 0 0 0 1,567Total 37,291 53,742 84,177 116,363 156,497 223,774Progressive Growth 46,621 75,322 125,042 181,943 257,639 Total# 411,001Source: CEA

During last six FYP, country has added the substation capacity at a CAGR of 54%. Total

capacity up to 11th plan has been 60% more over the cumulative capacity up to 10th Plan.

Figure 61: Trend in Substation Capacity Growth


50000

100000

150000

200000

250000

300000

350000

400000

450000

4662175322

125.042

181.943

257639

411001

CAGR: 54%

xxvi

During the 10th Plan, capacity addition was of 75,696 MVA while in 11th Plan it reached the

record level of 153,362 MVA. It is almost two times of the capacity added during 10 th Plan.

Transmission substations at the voltage level of 400 kV and 220 kV have grown at CAGR of

74% & 43% respectively.

Figure 62: Voltage Segmentation in Growth of Substation Capacity


50000

100000

150000

200000

250000

0 0 0 5200

8200

1120

0

0 0 0 0 0

2500

0

9330 21

580

4086

5

6038

0 9294

2

1510

27

3729

1

5374

2 84.177

116.363

1564

97

2237

74

±500 kV HVDC 765 kV 400 kV 220 kV

Over a span of five years, involvement of private players in T&D sector has changed from

nascent stage to mature level. In the IPTC & JV route collectively INR 20,000 has been invested

so far. Eight Inter-state transmission projects have been awarded through competitive bidding in

the past few years. On the state level several STUs have awarded projects to private players to

develop Intra-state transmission network.

In the manufacturing/manufacturing cum EPC segment there are more than fifty players in the

market. Further this segment is very broad due to presence of several small, medium & large

manufacturing companies and several medium & large EPC companies in the field. This segment

consists of Indian as well as foreign players and has witnessed a large growth in terms of number

of players and manufacturing capacity.

3.2.5 Performance of Distribution Sector

xxvii

During the 11th Plan, emphasis was on creation of capacity in Sub-transmission & Distribution

system to strengthen the Distribution sector. Emphasis has been given to Metering, Consumer

Indexing, adoption of IT facilities, GIS mapping, modern payment system, HVDS, Rural

franchise etc.

Access to Power for Population of India

As per Census 2001, 80% of the total inhabited villages were electrified and 44% of the rural

households had access to electricity. As on 31st July 2011, total of 96% of the villages of the

country have access to electricity.

Aggregate Technical & Commercial Losses

Accelerated Power Development and Reforms Program (APDRP) was launched in 2002-03 as an

Additional Central Assistance (ACA) to finance the modernization of sub-transmission &

distribution networks with the main objectives to reduce AT&C losses to 15%. AT&C loss at

national level has been reduced from 38.86% in 2001-02 to 27.15% during 2009-10. While some

states have shown an improvement in AT&C Loss reduction, it is pertinent to note that the

absolute loss levels are still at a higher level with respect to losses and require further efforts for

loss reduction.

xxviii

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

2010-11

2011-12

2012-13

2013-14

2014-15

0

5

10

15

20

25

30

35

40

32.534.8 34.3

33.030.6

29.527.7 27.2

25.223.3

21.519.7

18.0

Perc

enta

ge (

%)

Source: CEA

Figure 63: AT&C Loss: Past Performance and Future Expectations

Revenue Loss (ARR and ACS Gap)

As per the PFC report on ‘Performance of State Power Utilities’ for the year 2009-10 the cash

losses (revenue and subsidy realized basis) of utilities selling power directly to consumers

increased from INR 17,620 Crore in the FY 2007-08 to INR 42,415 Crore in the FY 2009-10.

The cumulative book losses (accrual basis) of the state utilities have increased from INR 79,339

Crore as on 31.03.2009 to INR 106,247 Crore at the end of year 2009-10. Gap between Average

Cost of Supply (ACS) and Average Revenue Realized (ARR) is widening and has increased to

INR 0.73 per unit in 2009-10 from Rs.0.37 per unit in 2007-08 on subsidy realized basis. While

some states have shown improvement in the financial health, others are yet to demonstrate the

impact of the policy initiatives. In order to restore the commercial viability of the distribution

companies it is necessary to eliminate the gap between (ARR) and (ACS).

Mounting of Debt on Utilities

The total borrowings of state DISCOMs have touched INR 177,602 Crore as on 31.03.2010 and

total interest charged from state utilities in year 2009-10 is INR 15,651 Crore. RBI has taken

cognizance of the difficult financial situations of DISCOMs and their attempts to bridge cash

losses by short term borrowings. In order to bridge the gap between revenue and expenditure and

to service interest on borrowing states resort to short-term borrowing and even divert long-term

loans to bridge cash losses. Conversion of existing Government loans to DISCOMs into

Government equity will help cash flow of DISCOMs because now subsidy payable by State

Government is adjusted against interest on loan.

3.2.6 Technological Development

In order to utilize the resources optimally, transmission and distribution network planning has

been moved away from the earlier generation evacuation system planning to integral system

planning. T&D network planning is a continuous process of identification of system addition

requirements, their timing and need. The transmission requirements could arise from

New generation additions in the system

Increase in demand

General system strengthening

xxix

These transmission addition requirements are identified, studied and firmed through the

transmission planning process. While the predominant technology for electricity transmission

and distribution has been Alternating Current (AC) technology, High Voltage Direct Current

(HVDC) technology has also been used for interconnection of all regional grids across the

country and for bulk transmission of power over long distances.

On the distribution end, system automation, implementation of SCADA, GIS, Asset

Management and High Voltage Distribution System (HVDS) has attracted the industry. This is

an effort to minimize system losses and energy pilferage which is degrading the financial health

of distribution utilities at a very fast pace. The reforms in distribution sector could arise from

Increase in demand and new connections

High system losses

Replacement of old system

Lack of new technology in distribution system

Lack of commercial principles

In order to meet the increasing power demand and address right-of-way (RoW) issue, higher

voltage technology is being adopted for developing transmission infrastructure. PGCIL has tried

to be an early adopter of new technologies and is moving towards higher voltage transmission

systems. It is currently focused on introducing 1,200 kV A/C voltage in the country. In May

2012, PGCIL in collaboration with 35 local and global manufacturers established 1,200 kV ultra

high voltages A/C test station at Bina (Madhya Pradesh) for the development of 1,200kV

equipment at large scale. In HVDC segment, it is implementing world’s longest ±800 kV, 6,000

MW Bi-pole multi terminal link of 2,000 km. It will connect Biswanath Chariyali in the north-

eastern region which is rich in hydro resources; to the Agra in northern region which is a power

deficit region.

Extensive use of Gas Insulated Switchgear substations, SCADA, Compact Tower Design, Phasor

Measurement Units, and Wide Area Measurement System etc is being done.

In the distribution segment, implementation of Supervisory Control and Data Acquisition System

(SCADA), Geographical Information System (GIS), Automatic Meter Reading (AMR), Smart

xxx

Metering, High Voltage Distribution System (HVDS), Prepaid Metering, 24*7 Customer Care,

DT Metering etc. are under progress.

3.3 Transmission & Distribution Sector in 12th Plan

3.3.1 Envisaged Growth in 12th Plan

Identification of transmission expansion

requirement for a plan period is done based on

power system studies corresponding to the

generation capacity addition program and

forecasted demand scenario expected at the

end of that plan. Transmission alternatives are

identified after the detailed studies based on

which the specific schemes are evolved, and

re-evolved taking into account the changes in

the generation program from time to time and subsequently discussed and firmed up.

Figure 65: Structure of T&D Network Planning

xxxi

Sub-transmission System132 kV and 66 kV

Distribution System33 kV, 11 kV & below

Transmission SystemPower system above 220 kV

New connectionsIncrease in demandIntra-state transmission abilityGeneral system strengtheningImplementation of new technology

Evacuation from new power plantsIncrease in demandInter-state transmission abilityGeneral system strengthening

Transmission & Distribution Capacity Expansion Planning

Transmission System Planning Distribution System Planning

Transmission Lines (Ckm) Substation Capacity (MVA)0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

70286

153.362

86072197

Total Private

Source: CEA

Figure 64: Infrastructure Addition in 11th Plan

The implementation program is subsequently worked out keeping in view identification of

projects, schemes and transmission elements that should be implemented matching with program

of generation capacity addition and load growth on yearly basis during the plan.

The 11th Plan fund requirement for the power sector was INR 1,031,600 Crore. The All India

Expenditure in power sector for 11th Plan has been about INR 707,278 Crore. For 12 th Plan,

Planning Commission has envisaged an ambitious investment of INR 1,124,600 Crore. This is

9% more than earlier envisaged amount and 59% higher than actual expenditure during 11th Plan.

Table 74: 12th Plan: Investment Layout in Power Sector

Physical Plan Investment (INR) CroreGeneration 75,785 MW 638,600Transmission 109,440 Ckm; 283,000 MVA 180,000Distribution System Automation, RAPDRP, RGGVY 306,000Total 1,124,600

Source: Planning Commission

The total fund requirement for development of

T&D system is estimated to be of the order of

INR 180,000 Crore (INR 100,000 Crore in

Central Sector, INR 55,000 Crore in State Sector

and INR 25,000 Crore in Private Sector).

In the Central Sector, there is no problem of

capital resources for setting up transmission

facilities. However, in the State Sector some of

the STUs require financial support, especially for

building transmission system for renewable

energy sources such as wind, solar and small

hydro. It is proposed that viability gap funding may be provided on case to case basis for

building intra-State transmission system for renewable generation and conventional hydro

stations.

The increase in the transmission lines of 220 kV and above voltage levels, in terms of circuit km,

have been around five times in last 26 years and that for substation capacity more than seven

times in the same period. There has been more increase in the transmission system at higher

xxxii


Figure 66: Sourcing of Financial Investment

voltage levels and substation capacities. This aspect of growth in transmission highlights

requirements of transmission network to carry bulk power over longer distances and at the same

time optimize right of way, minimize losses and improve grid reliability.

3.3.2 Addition of Transmission Lines

During 11th Plan, various 765 kV lines and substations have been added and a more are under

construction. The trend of increasing 765 kV systems in the grid is going to continue in the 12 th

Plan also. A number of new 765 kV lines and substations have been planned for evacuation of

bulk power in the range of 3,000 - 6,000 MW to longer distances. Their actual realization would

depend upon progress of associated generation projects. The planned 765 kV transmission

systems are expected to be implemented during 12th Plan or early 13th Plan period. Most of the

planned 765 kV systems are initially being operated at 400 kV. Their 765 kV operation depends

upon associated generation projects, which could be in 12th Plan or beyond.

Table 75: Planned addition of Transmission Lines (Ckm) in 12th Plan (2012-2017)

HVDC Bi-pole 765 kV 400 kV 220 kV Total Ckm9,440 27,000 38,000 35,000 109,440

Source: Ministry of Power

During 12th Plan period, a total of about 109,440 ckm of transmission lines have been planned for

addition. In this, 400 kV lines will dominate over other voltage levels but simultaneously there is

a decrement of 21% contribution than in 11th Plan.

Figure 67: Transmission Line Length (Ckm): Share of Voltage Level in Different Plans

10th Plan 11th Plan 12th Plan0%

10%

20%

30%

40%

50%

60%

2%5%

9%

2%

5%

25%

57%

56%

35%38%

34%

32%

500 kV/800 kV HVDC

765 kV

400 kV

220 kVCAGR: 413%

xxxiii

765 kV lines are going to take place of 400 kV lines as there is direct increment of 20% in their

contribution during 12th Plan. Over a period of last three FYP it will achieve a CAGR of 413%

which shows the country’s rapid adoption of higher voltage technology in order to facilitate large

amount of power transmission lines and reducing the need of ‘Right of Way’ requirement.

PGCIL is constructing 11 High Capacity Transmission Corridors (HCTC) to evacuate 80 GW of

generation capacity consisting six UMPPs of 28,000 MW and 55,000 MW for IPPs in coal rich

eastern region and coastal areas. The high capacity corridors entail the construction of 23,000

ckm. 70% of total ckm will be in 765 kV level while 30% in 400 kV level. These ambitious

corridors require estimated fund of INR 58,000 Crore. These projects are scheduled to be

commissioned over next five to seven year of time.

3.3.3 Addition of Substations

During the 12th Plan 270,000 MVA of AC transformation capacity and 13,000 MW of HVDC

substations are planned to be added.

Figure 68: Substation Capacity (MVA): Share of Voltage Level in Different Plans

10th Plan 11th Plan 12th Plan0%

10%

20%

30%

40%

50%

60%

4% 2% 5%0%

16%

53%

42%

38%

16%

54%

44%

27%

500 kV/800 kV HVDC

765 kV

400 kV

220 kV

Contribution of 765 kV substations will achieve robust growth. Just within next five years its

contribution will increase from mere 16% to highest level of 53%. 400 kV substations will see

steep downfall from 38% to only 16%. As the development of substation is to be kept in pace

with corresponding voltage level of transmission lines therefore 765 kV will dominate here too.

xxxiv

Table 76: Planned Addition of Substation Capacity in 12th Plan (2012-2017)

HVDC 765 kV 400 kV 220 kV Total MVA13,000 14,9000 45,000 76,000 283,000

Source: Ministry of Power

Timely development of transmission network requires firming up of the specific transmission

schemes corresponding to specific generation projects, which particularly in respect of inter-state

transmission system, need to be done 3 to 5 years ahead of the target date of completion. There

has been a consistent increase in the transmission network and transformation capacity of the

country. This increase is in consonance with increase in generation and demand of electricity in

the country. 11 HCTC under construction require 29 EHV substations aggregating over 60,000

MVA and four HVDC terminals totaling 7,000 MW Capacity.

3.3.4 Development of National Grid: Inter-State Transmission Capacity

Generation planning studies carried out by CEA had indicated that the capacity addition planned

on all-India basis is less than that planned on regional basis. Further, a strong all-India integrated

national grid enables harnessing of unevenly distributed generation resources in the country.

Recognizing the need for development of National grid, thrust was given to enhance the capacity

of inter-regional links in a phased manner.

Figure 69: Cumulative Growth of Inter-State Transmission Capacity (MW)

9th Plan

10th Plan

11th Plan

12th Plan

0 10,000 20,000 30,000 40,000 50,000 60,000 70,000

5,750

14,050

28,000

65,800

CAGR:

125%

Total Inter-regional transmission capacity by the end of 9th Plan was 5,750 MW. During 10th Plan

i.e. 2002-07, a total of 8,300 MW of capacity was added. At the end of 10th Plan capacity reached

at 14,050 MW which has crossed the level of 28,000 MW by the end of 11 th Plan. Addition of

xxxv

Source: CEA

37,800 MW in 12th Plan has been envisaged to make cumulative capacity to the mark of 65,800

MW.

It is expected that, at the end of 12th Plan, each region in the country would be connected to an

adjacent region(s) through at least two high capacity synchronous 400 kV or 765 kV lines and a

HVDC Bi-pole/back-to-back link. This would make the National Grid a large, meshed

synchronous transmission grid where all the regional and State grids in them would be

electrically connected and operating at single frequency.

3.3.5 Growth of Distribution Business

Distribution sector has been

remaining the underperformer

since late 70s. Various reasons as

described earlier did not let the

distribution business run on

commercial principles. Now the

discoms are in the dire need of

financial bail out package but it

doesn’t seem the long term

solution for sustainable

development and survival. In the 12th Plan period, certain goals have been set to achieve.

Capacity Addition and Investment

Planning Commission has envisaged the investment of INR 306,235 Crore in distribution sector.

This investment can majorly be further divided in to following category of equipments and

activities.

New Lines: In the 12th Plan, 1,305,000 ckm of new lines are required to be added. In this, share

of LV lines will be 47%, while 11 kV lines and 33 kV will be 43% and 10% respectively. This

will require a sum of INR 92,730 Crore.

New Substations: In the 12th Plan, 4,400 new distribution substations of 33 kV/11 kV voltage

level are to be added. In these substations, 8,800 new power transformers are required to be put

xxxvi

1991-92

1996-97

2001-02

2006-07

2007-08

2008-09

2009-10

2010-11

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,00043

5829

7

4886

800

5725

890

6580

949

6902

117

7079

025

7094

129

7391

599

Source: CEA

Figure 70: Growth of T&D Lines below 66 kV

in the service which will comprise transformation capacity of 88,000 MVA. The activity will

require a sum of INR 22,000 Crore.

Table 77: Distribution Sector: Network Enhancement in 12th Plan

Sr. No.

Name of Segment UnitsPhysical

Financial (INR Crore)

2012-17 2012-17I New Lines (i) 33 kV O/H Line Ckm 121,500 9,720 33 kV U/G Cable Ckm 13,500 4,050 Total 33 kV line Ckm 135,000 (ii) 11 kV O/H Line Ckm 448,000 22,400 11 kV U/G Cable Ckm 112,000 22,400 Total 11 kV Line Ckm 560,000 (iii) LV O/H Ckm 488,000 24,400 LV ABC Ckm 122,000 9,760 Total LV Ckm 610,000 II Installation of New S/S 33/11 kV (2*10 MVA) Nos. 4,400 22,000 No. of 10 MVA Transformers Nos. 8,800 Transformation Capacity MVA 88,000 III Installation of DT's Including all Accessories MVA 105,000 1000 KVA Nos. 10,500 1,260 630 KVA Nos. 33,500 3,350 315 KVA Nos. 67,000 4,020 200 KVA Nos. 105,000 5,250 100 KVA Nos. 210,000 8,400 25 KVA Nos. 424,000 8,480 Total No. of DT's Nos. 850,000 IV Augmentation of S/S 33/11 kV MVA 50,000 10,000 11/0.4 kV MVA 50,000 10,000

V CapacitorsMVA

R16,000 1,280

VI Service Connections 50,000,000 25,000VII Re-Conductoring of Lines (i) 33 kV Ckm 100,000 3,000 (ii) 11 kV Ckm 500,000 10,000 (iii) LV Ckm 1,000,000 20,000 Sub Total 224,770 Productive Load Scheme 61,940 Smart Grid 9,500

xxxvii

IT facilities & SCADA including HRD 10,000 R&D 25 Total 306,235Source: Planning Commission

Distribution Transformers: Distribution transformers comprising transformation capacity of

105,000 MVA are to be be added in the 12th Plan. Total number of required transformer will be

850,000 in which DTs of 25 kVA will have largest chunk of 424,000 nos. This is because of

greater focus on rural electrification in which DTs of small capacity are required in large

number. It will require an investment of INR 30,760 Crore.

System Augmentation: Capacity enhancement of existing substations, replacement of old

components and equipment revamping will need an investment of INR 79,280 Crore. It will

comprise substation’s transformation capacity enhancement, installation of capacitors, expenses

due to new service connections, re-conductoring of distribution line etc.

IT Implementation: With increased focus on IT implementation in distribution system, a sum of

INR 81,465 Crore has been planned for investment. This is to enhance the operational and

commercial performance of the distribution utilities.

Reduction of AT&C Losses

It has been the most focused activity for last ten years in the Indian power distribution industry.

Still, expected results have not been received in last ten years. For the next five years, Planning

Commission is very optimistic in terms of AT&C loss reduction from a current level to 18% by

the end of FY 2014-15.

Table 78: AT&C Losses: Projected Performance

Region State 2009-10 10-11 11-12 12-13 13-14 14-15

Input Energy (MU)

AT&C Loss (%)

Eastern Bihar 9,281 43.92 40.92 37.92 34.92 31.92 28.92Jharkhand 8,396 10.43 8.93 7.43 5.93 4.43 2.93OrissaCESCO 6,232 39.99 36.99 33.99 30.99 27.99 26.49NESCO 4,705 36.68 33.68 30.68 27.68 26.18 24.58SESCO 2,286 51.01 48.01 45.01 42.01 39.01 36.01

xxxviii

WESCO 6,301 37.58 34.58 31.58 28.58 27.08 25.58Sikkim 512 51.37 48.37 45.37 42.37 39.37 36.37WB 25,427 33.24 30.24 27.24 25.74 24.24 22.74

North East

AP 670 52.99 49.99 46.99 43.99 40.99 37.99Assam 4,392 29.03 27.53 26.03 24.53 23.03 21.53Manipur 454 48.02 45.02 42.02 39.02 36.02 33.02Meghalaya 1,342 48.73 45.73 42.73 39.73 36.73 33.73Mizoram 320 39.06 36.06 33.06 30.06 28.56 27.06Nagaland 385 45.97 42.97 39.97 36.97 33.97 30.97Tripura 672 29.17 27.67 24.67 21.67 18.67 15.67

Northern

DelhiBRPL 9,667 19.83 18.33 16.83 15.33 13.83 12.33BYPL 5,645 28.63 27.13 25.63 24.13 22.63 21.13NDPL 6,910 15.69 14.19 12.69 11.19 9.69 8.19HaryanaDHBVNL 15,884 28.1 26.6 25.1 23.6 22.1 20.6UHBVNL 15,211 29.91 28.41 26.91 25.41 23.91 22.41HP 6,806 18.47 16.97 15.47 13.97 12.47 10.97J&K 9,813 70.45 67.45 64.45 61.45 58.45 55.45Punjab 38,806 17.73 16.23 14.73 13.23 11.73 10.23RajasthanAVVNL 12,345 33.04 30.04 27.04 22.04 21.04 18.04JDVVNL 12,820 31.51 28.51 25.51 22.51 19.51 16.51JVVNL 16,286 26.69 25.19 23.69 22.19 20.69 19.19UPDVVNL 13,143 49.62 46.62 43.62 40.62 37.62 34.62MVVNL 9,653 28.72 27.22 25.72 24.22 22.72 21.22PaVVNL 17,766 27.92 26.42 24.92 23.42 21.92 20.42PoVVNL 12,783 54.46 51.46 48.46 45.46 42.46 39.46KESCO 2,722 37.36 34.36 31.36 28.36 26.86 25.36Uttaranchal 8,280 33.53 30.53 27.53 24.53 21.53 18.53

Southern APAPCPDCL 31,933 17.93 16.43 14.93 13.43 11.93 10.43APEPDCL 10,814 9.69 8.19 6.69 5.19 3.69 2.19APNPDCL 10,464 18.52 17.02 15.52 14.02 12.52 11.02APSPDCL 15,300 16.63 15.13 13.63 12.13 10.63 9.13KarnatakaBESCOM 20,317 21.1 19.6 18.1 16.6 15.1 13.6GESCOM 5,764 38.05 35.05 32.05 29.05 27.55 26.05HESCOM 7,402 28.51 27.01 25.51 24.01 22.51 21.01MESCOM 3,274 18.39 16.89 15.39 13.89 12.39 10.89CHESCOM 4,245 28.22 26.72 25.22 23.72 22.22 20.72Kerala 16,129 14.89 13.39 11.89 10.39 8.89 7.39Pondicherry 2,527 19.35 17.85 16.35 14.85 13.35 11.85

xxxix

Tamil Nadu 66,974 20.15 18.65 17.15 15.65 14.15 12.65

Western

Chhattisgarh 18,476 37.98 34.98 31.98 28.98 27.48 25.98Goa 2,962 7.77 6.27 4.77 3027 1.77 0.27GujaratDGVCL 10,565 15.23 13.73 12.23 10.73 9.23 7.73MGVCL 6,727 15.27 13.77 12.27 10.77 9.27 7.77PGVCL 19,858 32.34 30.84 29.34 27.84 26.34 24.84UGVCL 14,891 18.89 17.39 15.89 14.39 12.89 11.39MPMPMKVVCL

10,563 42.26 39.26 36.26 33.26 30.26 27.26MPPKVVCL 12,705 36.16 33.16 30.16 28.66 27.16 25.66MPPUKVVCL

9,632 46.11 43.11 40.11 37.11 34.11 31.11MaharashtraMSEDCL 80,526 25.02 23.52 22.02 20.52 19.02 17.52Grand Total 667,963 27.15 25.23 23.31 21.48 19.73 17.99


xl

CHAPTER – 4

INDIAN ELECTRICAL T&D EQUIPMENT INDUSTRY

4.1 Industry Scenario

Transmission and Distribution sector encompasses more than hundred major, medium and small

equipments and components. From application point of view it can divide broadly in two

sections. Indian T&D equipment industry consist of variety of products. Today the industry’s

size is estimated at INR 64,072 Crore.

Table 79: Transmission & Distribution Equipments

Transmission Line Components Substation Components1 Conductors Circuit Breaker2 Transmission Towers Isolator3 Insulators Current Transformer4 Wave Trap Potential Transformer5 Auto Re-Closer Lighting Arrester6 Vibration Damper Bus Bar7 Corona Rings Control Panels8 Other Accessories Relays9 Capacitor Bank10 Battery Bank11 Metering Instruments

xli

Figure 71: Growth of (All) T&D Equipments Industry in India

2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-120

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

7,4

15

9,6

60

10

,20

0

12

,10

5

18

,02

0

24

,30

0

38

,92

0

45

,73

0

47,49652,863

60

,10

5

64,072

INR

Cro

re

The T&D equipment market has registered a compound annual growth rate (CAGR) of 21.7%,

from INR 7,400 Crore in 2000-2001 to INR 64,072 Crore in 2011-12. This growth has been

driven by increased generation capacity addition and subsequent need to augment the T&D

network.

xlii

Source: IEEMA

Figure 72: Growth of Major T&D Equipments in India

Source: IEEMA

Growth rate of the Indian electrical equipment industry has decelerated to 6.6% in 2011-12 as

compared to 11.3% and 13.7% in 2009-10 and 2010-11 respectively. Imports of electrical

equipment have grown in the past five years at a CAGR of 28.28%. Current export-import trends

based on 27 major ports trade data indicates that imports continue to rise for 765 kV transformers

& reactors (mostly through power project imports), insulators, LV switchgear and HV cables.

Total Imports of 765 kV transformers & reactors in 2011-12 were INR 1,229 Crores; in the last

quarter (Q4) 2011-12, imports sharply increased by 125% (INR 687 Crores) over the combined

total of the first three quarters (INR 542 Crores).

4.2 Cable & Conductor

4.2.1 Cable

Cables are used when underground transmission or

distribution is required. These cables are laid in ducts or may be buried in the ground. Unlike in

overhead lines, air does not form part of the insulation, and the conductor must be completely

xliii

2008-09 2009-10 2010-11 2011-12

-3.5

13.3

12.2

10

14.5

21.2

-2.4

4.4

12.1

16.9

25.7

-1.2

9.1

13.5

1.22.

6

10.7

34.9

-1.8

-8.2

11.3

15.4

6.1

13.5

9.2

4

-0.8

2.7

11.3 13

.7

6.6

Rotating Machines Switchgear Cables Transformers Capacitors Energy Meters Transmission Lines Total

Figure 73: Cable

insulated. Thus cables are much more costly than overhead lines. Cable consists of core that is

made of copper. For insulation purpose, different type of material & medium are used. It depends

upon the level of voltage to transmitting power.

4.2.2 Types of Cable

High voltage cables are generally single cored, and hence have their separate insulation and

mechanical protection by sheaths. In the older paper insulated cables, the sheath was of extruded

lead.

Paper Insulated Power Cables

The insulation consists mainly of paper tape impregnated with compound. The paper must be

free from ligneous fibers and from metallic or other conducting spots. The compound with

which the paper is insulated should be of such a consistency that it is plastic at ordinary

temperatures, and has no tendency to drain away from the cable.

The impregnating compound varies from manufacturer to manufacturer, but they all are based on

paraffinic or naphthenic mineral oil, with resin frequently added to lower the viscosity and to

improve its impregnating qualities. The paper is made from Manila fiber or wood pulp.

Three-Core Belted Type Cables

In the case of a 3-core cable, the 3-cores are

individually insulated with paper insulation. The filler

space between the core insulation is also filled up with insulation, but depriving these of voids is

much more difficult. Belt insulation is used on top of

all three core insulations, and the lead sheath is

extruded over this. Over the lead sheath, there is

generally bitumen to prevent damage.

Pressurized High Voltage Cables

Oil Pressure Cables

Gas Pressure Cables

xliv

Figure 74: Cross Sectional View of Three Core Belted Cable

These are used for extra high voltage transmission.

4.2.3 Conductor

A conductor is a material that facilitates the flow of electricity

(or electric current) through a transmission line. Different types of conductor are used in

transmission lines. They vary in number and size, depending on the type of circuit and the

transmission voltage. Steel, Aluminium and copper are the most common conducting materials

used in transmission lines.

4.2.4 Types of Conductor

Broadly two types of conductors ACSR (Aluminium Core Steel Reinforced) and ACAR

(Aluminium Core, Alloy Reinforced) are used.

Aluminum Core Steel Reinforced (ACSR)

In an ACSR conductor, a stranded steel core carries the

mechanical load, and layers of stranded aluminium

surrounding the core carry the current. ACSR conductors

are usually used for high-voltage transmission lines. Steel

strands forms central core which is surrounded by two

layers of aluminum strands. For a given resistance

conductors of different strengths can be made by taking

different properties of steel and aluminum areas. The steel core does not contribute to conduction

of current practically. The current carrying capacity and resistance of this conductor is dependent

on conductivity of aluminum.

Aluminum Core, Alloy Reinforced (ACAR)

An ACAR conductor is a stranded cable made of an aluminium alloy with low resistance and

high mechanical strength. The central core is made up from aluminum alloy which is surrounded

by layers of aluminum conductors. The conductivity is better and strength to weight ratio is equal

to ACSR conductor having same diameter. As compared to ACSR conductor, ACSR conductor

xlv

Figure 75: Aluminum Conductor

Figure 76: ACSR Conductor

is smaller in size and lower in weight for the same electrical capacity. ACAR conductors are

used for sub transmission and distribution lines.

4.2.5 Competitor Analysis

Table 80: Sterlite Technologies Limited

Year of Establishment 2006-2007

Nature of Business Manufacturing EPC

Products/Services Transmission Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation Power Conductor and Cable Manufacturing

Leading Product/Service Power Conductor and Cable Manufacturing Transmission Tower Manufacturing

Infrastructure Mfg Unit: 4Annual Turnover(2010-2011 and 2009-10)

INR 2,317 Crore and INR 2,432 Crore

Technology Sourcing Indigenous

Global Footprints Across 70 countries such as: China, Denmark, India, Netherlands, Russia,

South Africa, Taiwan, Turkey, UAE, UK, USA

Indian Clientele Various SEBs across India Private companies in Power T&D field

Certification ISO 9001-2000, ISO 14001, OHSAS 18001, NABL

Table 81: JSK Industries Pvt. Limited

Year of Establishment 1965Nature of Business ManufacturingProducts/Services Power ConductorsLeading Product/Service Aluminum ConductorInfrastructure Mfg unit: 2Annual Turnover(2010-2011 and 2009-10)

INR 763 Crore and INR 498 Crore


Global Footprints Dubai

Indian Clientele

Various SEBs such as: MPPTCL, GETCO, LPTCL, MAHATRANSCO, TNEB

PSUs: PGCIL, BHEL Private companies such as: ABB, L&T Ltd, Torrent Power, Suzlon Energy,

EMI Transmission, Essar PowerCertification ISO 9001-2008

xlvi

Table 82: Diamond Power Infrastructure Limited

Year of Establishment 1970


Products/Services

Transmission Tower Manufacturing Transformer Manufacturing Commissioning and Testing of Transmission Lines & Substation Power Conductor and Cable Manufacturing

Leading Product/Service Commissioning and Testing of Transmission Lines & Substation Power Conductor and Cable Manufacturing

Production Capacity

LV Cable: 34,300 kmpa HV Cable: 5,800 kmpa EHV Cable: 2,000 kmpa Tower Manufacturing: 48,000 tpa

Annual Turnover(2010-2011 and 2009-10)


Technology Sourcing IndigenousGlobal Footprints New-Zealand, Zimbabwe, Tanzania, Sri Lanka, Tajikistan, Bangladesh, Israel

Indian Clientele

Various SEBs of states such as: Assam, Gujarat, Haryana, Rajasthan, Karnataka, MP, Maharashtra, Punjab, UP, West Bengal

PSUs: PGCIL, BHEL, BHEL, NTPC, PGCIL, SAIL Private companies such as: ABB, L&T Ltd, EMCO, CGL, Enercon, Suzlon

Energy, Kalpataru Power Transmission, Jindal, Essar PowerCertification ISO 9001-2008, ERDA, CPRI, BIS, BSI, DIN, IEC, ASTM

Table 83: Deepak Cables (India) Limited


Nature of Business Manufacturing EPC Turnkey Projects

Products/Services Power Conductor and Cable Manufacturing Erection, Commissioning and Testing of Transmission Lines & Substation

Leading Product/Service Power Conductor and Cable ManufacturingInfrastructure Mfg Unit: 2

Production Capacity Aluminum Conductor: 36,000 tpa Aluminum Wire Rods: 18,000 tpa


Indian Clientele Various SEBs across India Central utilities Private companies in Power T&D field

Certification ISO 9001-2000

Table 84: KEC International


xlvii

Nature of Business Manufacturing EPC Services

Products/Services

Power Cable Transmission Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation Infrastructure Development (Railways, Oil & Gas, Construction)

Leading Product/Service Power Cable Transmission Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation

Infrastructure Mfg unit: 6 (India) + 2 (Abroad)Production Capacity Tower Manufacturing: 311,000 tpaAnnual Turnover(2010-2011 and 2009-10)



Global Footprints

Across 40 countries spread over Africa, Middle East, Central Asia, North America;

Manufacturing in Brazil and Mexico

Indian Clientele Government utilities such as: WBSEDCL, MSEDCL, PGCIL, NHPC,

MAHATRANSCO, J&K Power Development Private companies in Power T&D field

Certification ISO 9001:2000, CPRI, ISO, BIS

4.2.6 Financial Analysis

Table 85: Competitor Performance

Sr No Company Name2010-2011 (Figures in Crore)

ATO (V)

Op Ex (W)

Raw Mat. Cost (X) EBIDTA (Y) PAT (Z)

INR INR INR X/WINR

Y/V INR Z/V

1Sterlite Technologies Limited

2,317 1,995 1,585 79% 320 14% 185 8%

2JSK Industries Pvt. Limited

763 NA NA NA NA NA NA NA

3Diamond Power Infrastructure Limited (Conductor)

1,285 1,149 1,098 95% 159 12% 98 8%

4 KEC International 4,057 3,593 2,172 60% 463 11% 275 7%

4.2.7 Industry Performance

xlviii

Table 86: Performance of Cable & Transmission Line Industry

Name of the EquipmentWeight (%)

Industry Size (INR Crore)

YoY % Change

2010-11 2008-09 2009-10 2010-11 2011-12Cables 25.8 15,510 4.4 12.1 16.9 25.7PVC Power Cables 17.9 9,710 14.3 14.5 9 17.4Control & Special Purpose Cables

7.9 4,300 -26.6 2.4 34.3 44.5Transmission Lines 23.4 14,070 13.5 9.2 4 -0.8Transmission Line Towers 12.6 6,600 6.5 19 6.8 -5.2Conductors 10.8 5,670 21.3 0.2 -0.8 4.3Source: IEEMA

The Indian cable industry is highly fragmented with hundreds of cable manufacturing

companies; a larger total than can be found in any other country in the world except China. Many

of these Indian companies are small-scale cable producers. The 6.6% growth seen in the overall

electrical equipment industry during FY12 was largely driven by remarkable performance of the

cables industry. It grew by 25.7% in FY12, which came over and above the 16.9% rise in FY11.

In fact, growth in the cables industry has been steadily inching up from 4.4% in FY09. The

cables industry has grown appreciably in size. In FY11, the cables industry was estimated to be

worth INR 15,510 Crore. With changing specifications, kilometers are not the sole barometer to

judge the growth of the industry. Though there seems a slight volume growth in the industry, the

same is mandate due to increase in commodity prices. The weight age of cable industry is about

25.8% of the overall electrical industry. The growth of HV & EHV cable industry was mainly

due to acceleration in implementation to the ongoing and new projects in the pipeline. In year

2010-2011, the total production of LV, PVC & XLPE power cables was about 2.65 lakh km both

in organized & unorganized sector, amounting to an increase over previous year by 12.7%.

While PVC & XLPE power cables (3.3 kV- 33 kV), the production was about 24,200 km which

is an increase over the previous year by 6.6%.

xlix

Table 87: Strategic Analysis

About 1000 km of Power cables above 33 kV was produced in this fiscal an increase of about

33%. The estimated industry size in 2010-11 for power cables is INR 9710 Crore, an increase of

25% over the previous year 2009-2010.

4.2.8 Market Prospects

Cable industry has emerged as most consistent and fastest growing market in last five years. This

trend is expected to continue in future also. One of the best positive aspects with the cable

l

Growth Drivers 12th Five Year PlanNew Transmission Lines: 109,440 CkmNew Distribution : 1,305,000 CkmRe-Conductoring of Distribution Lines: 1,600,000 CkmReplacement of Old Transmission LinesRGGVY schemeSystem strengthening under R-APDRP Projects

Market CompetitorsJSK Industries Pvt. LimitedFinolex CablesDiamond Power Infrastructure LimitedCable Corporation of IndiaBirla GroupHavells IndiaNicco Corp.KEC International (RPG Group)Khetan Group of IndustriesKEI Wires & CablesParamount CablesSterlite Technologies Limited

Prospective Clients Central Transmission UtilityState Transmission UtilitiesExisting & forthcoming private distribution companiesEPC companiesMajor industries e.g. Petrochemicals, Mining, Steel/Metallurgical, Ship building, Engineering, Cement, Railway, Defense

Entry Opportunity Very few dominant playersUnorganized sector

Various local & regional manufacturers

Business RiskFluctuating raw material pricesPricing issue specially with Govt. clientsIndustry is highly dependent and driven by growth in power sector

Figure 77: Cable Industry: Past Performance and Expected Market Size

industry is that all three verticals of power sector i.e. generation, transmission and distribution

are the demand drivers for cable industry.

Source: IEEMA

In the 11th Plan cable industry has grown at a CAGR of 14.5%. By the end of 12 th Plan, CEA has

envisaged this market size of INR 37,000 Crore.

Source: IEEMA

While being optimistic, this industry is expected to grow up to the size of INR 38,394 Crore.

li

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-170

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,0001

1,3

37

11

,83

6

13

,26

8

15

,51

0

19

,49

6

22

,32

6

25

,56

7

29

,27

8

33

,52

8

38

,39

4

INR

Cro

re

CAGR:

14.5%

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-170

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

4,7

03 5

,70

4

5,7

16

5,6

70

5,9

14

6,2

63

6,6

32

7,0

23

7,4

37

7,8

75

INR

Cro

re

Figure 78: Conductor Industry: Past Performance and Expected Market Size

Conductor industry has not witnessed a good growth rate over last five years. CAGR in 11 th Plan

has been 5.9% with fluctuating performance.

Major users of power cables are

broadly classified into:

Power sector: Central, State and

Private electricity utilities

Major industries like:

Petrochemicals, Mining,

Steel/Metallurgical, Ship building,

Engineering, Cement, Railway,

Defense etc.

Many overseas cable companies are looking at Indian market as the upcoming market for HV &

EHV cables. Considering the strong domestic demand for cables in the power sector, overseas

cable manufacturing giants have entered into market through joint ventures with Indian cable

manufacturers for manufacturing EHV cables and special types of cables.

Major imports of HV/EHV cables are from Thailand, China, Germany, Switzerland and Korea

whereas export destinations are UK, UAE, Afghanistan, Nigeria, Ethiopia and Oman.

4.3 Transmission Tower

The electric power system can be divided into transmission, sub-transmission, and distribution

systems. With operating voltages less than 33 kV, the distribution system carries energy from the

local substation to individual households, using both overhead and underground lines.

Table 88: Voltage Segmentation of Power System

Generation 11kV, 15.5kV, 22kV etc.Transmission Transmission Lines HVAC: 765kV, 400kV, 220kV; HVDC: 500kV, 800 kV Sub-Transmission lines 132kV, 110kV, 66kVDistribution 33kV, 22kV, 11kV, 6.6kV, 440 Volts, 220Volts

lii

2006-07 2007-08 2008-09 2009-10 2010-110

500

1,000

1,500

2,000

2,500

3,000

3,500

1,723

2,049

3,126

2,021

2,515

INR

Cror

e

Source: Ministry of Commerce

Figure 79: Cable & Conductor: Export Trend

With operating voltages of 66 kV, 132 kV

and up to 220 kV the sub-transmission

system distributes energy within an entire

district and regularly uses overhead lines.

With operating voltage exceeding 220

kV, the transmission system interconnects

generating stations and large substations

located close to load centers by using

overhead lines.

4.3.1 Types of Transmission Tower

Overhead transmission lines distribute the

majority of the electric energy in the

system. A typical HVAC line has three phase conductors to carry the current and transport the

energy, and two grounded shield conductors to protect the line from direct lightning strikes. The

usually bare conductors are insulated from the supporting towers by insulators attached to

grounded towers or poles. Lower-voltage lines use post insulators, while the high-voltage lines

are built with insulator chains or long-rod composite insulators. The normal distance between the

supporting towers is a few hundred feet. Transmission lines are subject to environmental

adversities, including wide variations of temperature, high winds, and ice and snow deposits.

Typically designed to withstand environmental stresses occurring once every 50–100 years, lines

are intended to operate safely in adverse conditions.

A distinction is made between the anchor towers and the intermediate towers of a power

transmission line. The rigid and strong construction of the anchoring towers is intended to

withstand considerable stresses caused by tension in the lines. Anchor towers are installed at the

beginning and end of a power transmission line, at turns, and at points where the line passes over

water or through mountains. Intermediate towers are not as strongly constructed, serving mainly

to support the power lines and cables along straight sections.

liii

Figure 80: Transmission Tower

The transmission towers are usually made from steel and galvanized steels. Aluminum is also used as construction material for transmission lines. Type of

the transmission towers used in a circuit depends mainly

on following factors.

Working voltage level

Amount of power

Wind speed profile in the zone

Physical environment

Availability of RoW (Right of Way)

Waist Type Tower

This is the most common type of transmission tower. It's used for voltages ranging from 110 to

735 kV. Because they're easily assembled, these towers are suitable for power lines that cross

very uneven terrain. But this type of tower requires large RoW for single circuit.

Double Circuit Tower

Both tubular and lattice steel towers can be designed so as to support either one or two circuits of

electrical current. Double-circuit towers hold the different

conductors stacked atop one another, while in single-

circuit towers the conductors are lined up horizontally.

This small-footprint tower is used for voltages ranging

from 110 to 315 kV. Its height ranges from 25 to 60

meters.

Steel Tubular Pole

Featuring a streamlined, aesthetic shape, this structure is

less massive than other towers, allowing it to blend easily

into the environment. Therefore, it's being used more and

liv

Figure 81: Waist Type Tower

Figure 82: Double Circuit Tower

Figure 83: Steel Tubular Pole

more in urban centre. Measuring between 27 and 45 meters in height, it's suitable for voltages

ranging from 110 to 315 kV.

Guyed-V Tower

This tower is designed for voltages ranging from 230 to 735 kV. It is more economical than the

double-circuit and waist-type towers. These towers have also been used by the transmission companies in cases where more space is available. These are simple, easy and cheaper to install. The guyed towers also require less time for installation. The main disadvantage is that these towers require more space due to presence of guy wires.


Table 89: Kalpataru Power Transmission Limited



Products/Services Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation Infrastructure Development (Railways, Oil & Gas, Construction)

Leading Product/Service Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation

Infrastructure Mfg unit: 2Production Capacity Tower Manufacturing: 100,000 tpaAnnual Turnover(2010-2011 and 2009-10)


Global Footprints

Across 31 countries such as: Ethiopia, Algeria, Vietnam, UAE, South Africa, Nigeria, Kenya, Kuwait, Philippines, Syria, Mexico, Thailand, Abu Dhabi, USA, Canada, Peru

Indian Clientele PGCIL, GETCO, Essar Power, MSETCL, TNEB, WBSEB, ADANI PowerCertification ISO 9001-14001

Table 90: IVRCL


lv

Figure 84: Guyed-V Tower

Nature of Business Manufacturing

Products/Services Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation Infrastructure Development (Railways, Oil & Gas, Construction)




Global Footprints Across 45 countries world wide

Indian Clientele

Government utilities such as: BHEL, NTPC, ONGC, NPCIL, BPCL, IOCL, PGCIL, AAI, Indian Railways, Ministry of Defense, Konkan Railway, MSETCL, HVPNL

Private companies such as: BITS, DLF, Telco Construction Equipment Company Ltd, Tata Projects Ltd, JSPL, Tata Docomo, Tata Cummins

Certification ISO 9001:2000, IS

Table 91: KEC International



Products/Services

Power Cable Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation Infrastructure Development (Railways, Oil & Gas, Construction)

Leading Product/Service Tower Manufacturing Power Cable Commissioning and Testing of Transmission Lines & Substation

Infrastructure Mfg unit: 6 (India) + 2 (Abroad)Production Capacity Tower Manufacturing: 311,000 tpaAnnual Turnover(2010-2011 and 2009-10)


Global Footprints

Across 40 countries spread over Africa, Middle East, Central Asia, North America;

Manufacturing in Brazil and Mexico

Indian Clientele Government utilities such as: WBSEDCL, MSEDCL, PGCIL, NHPC,

MAHATRANSCO, J&K Power Development Various private companies

Certification ISO 9001:2000, CPRI, ISO, BIS

lvi

Table 92: Diamond Power Infrastructure Limited



Products/Services

Tower Manufacturing Transformer Manufacturing Commissioning and Testing of Transmission Lines & Substation Power Conductor and Cable Manufacturing

Leading Product/Service Commissioning and Testing of Transmission Lines & Substation Power Conductor and Cable Manufacturing

Production Capacity

Tower Manufacturing: 48,000 tpa LV Cable: 34,300 kmpa HV Cable: 5,800 kmpa EHV Cable: 2,000 kmpa



Global Footprints New-Zealand, Zimbabwe, Tanzania, Sri Lanka, Tajikistan, Bangladesh, Israel

Indian Clientele

Various SEBs of states such as: Assam, Gujarat, Haryana, Rajasthan, Karnataka, MP, Maharashtra, Punjab, UP, West Bengal;

PSUs: PGCIL, BHEL, BHEL, NTPC, PGCIL, SAIL Private companies such as: ABB, L&T Ltd, EMCO, CGL, Enercon, Suzlon

Energy, Kalpataru Power Transmission, Jindal, Essar PowerCertification ISO 9001-2008, ERDA, CPRI, BIS, BSI, DIN, IEC, ASTM

Table 93: Jyoti Structures Limited



Products/Services Tower Manufacturing Conductor Manufacturing Commissioning and Testing of Transmission Lines & Substation

Infrastructure Mfg unit: 2 (India) + 1 (Dubai)

Production Capacity Tower Manufacturing: 110,000 tpa (India) + 50,000 tpa (Dubai) Conductor Manufacturing: 2,500 ckm per annum



Global Footprints

Presence across 40 countries such as: Australia, Chile, Canada, Ethiopia, Egypt, France, Iran, Indonesia, Malaysia, Namibia, Nigeria, Oman, Philippines, Peru, Qatar, South Africa, Sri Lanka, Thailand, Tunisia, UAE, Uganda etc.

Indian Clientele Various Transcos in country PSUs: PGCIL & NTPC

Certification ISO 9001:2008, ISO 14001:2004, OHSAS 18001:2007

lvii

Table 94: Gammon India Ltd


Nature of Business

Manufacturing EPC Turnkey Projects Engineering & Design

Products/Services Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation Infrastructure



Global Footprints Afghanistan, Kenya, Afghanistan, Nigeria, Ethiopia, Ghana, Sri Lanka, Oman

Indian Clientele

Various state such as: Govt. of Andhra Pradesh, Govt. of West Bengal DMRC, GAIL, PGCIL, NTPC, NHPC, NPCIL, NHAI, SJVNL Private companies such as: Godrej Properties, Municipal Corporation of

Amritsar Certification ISO 9001:2008, ISO 14001:2004, OHSAS 18001:2007

Table 95: Unitech Power Transmission Ltd



Products/Services Tower Manufacturing Commissioning and Testing of T&D Lines & Substations

Infrastructure Mfg unit: 1Production Capacity Tower Manufacturing: 35,000 tpaAverage Annual Turnover INR 1,500 CroreGlobal Footprints Nepal, Korea, Sudan, Finland, Spain, France, Libya, Germany,

Indian Clientele

Various SEBs across India PSUs: PGCIL, NTPC Private companies such as: Tata Power, Fortrum, Hyundai, Inabensa, Alstom,

SeimensCertification ISO 9001:2008, ISO 14001:2004

Table 96: Aster Private Ltd



Products/Services Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation

Infrastructure Mfg unit: 6

lviii

Production Capacity Tower Manufacturing: 142,320 tpa

Global Footprints

Afghanistan, Bahrain, Burkina Faso, Cambodia, Congo, Ethiopia, Ghana, India, Kenya, Madagascar, Mauritius, Nepal, Cameroon, Nigeria, Oman, Qatar, Rwanda, Saudi Arabia, Seychelles, Sri Lanka, Sudan, Tanzania, UAE, Yemen

Indian Clientele

Various State Transcos such as: MSETCL, APTRANSCO, GETCO, MSEDCL, OPTCL, UPPTCL, KPTCL, MPPTCL, HVPTNL, KSEB, RRVPNL

PSUs: PGCIL & NTPC Private players such as: Alstom, Siemens, ABB, TATA, Lanco, L&T, Sterlite,

KSK, JSPL, Vijay Electricals, EMC Limited, ECI, Deepak CablesCertification ISO 9001:2008, ISO 14001:2004, OHSAS 18001:2007

Table 97: Man Structurals Pvt. Ltd



Products/Services Tower Manufacturing Commissioning and Testing of Transmission Lines & Substation Infrastructure Development (Railways, Construction)


Infrastructure Mfg unit: 3

Indian Clientele

Government utilities such as: PGCIL, RRVPNL, KPTCL, GEB, OSEB, HPEB;

Other players such as Kalindee Rail Nirman, SIEMENS Ltd, KEC International, Hindustan Zinc Ltd, Tata Projects Ltd, Techno Electric & engineers Co. Ltd, Nepal Electricity Supply Co.

Certification ISO 9001:2000




ATO (V)

Op Ex (W)


INR INR INR X/W INR Y/V INR Z/V

1Kalpataru Power Transmission Ltd

2,874 2,497 1,277 51% 377 13% 149 5%

2 IVRCL 5,659 NA NA NA 523 9% 158 3%3 KEC International 4,057 3,593 2,172 60% 463 11% 275 7%

4Diamond Power Infrastructure Ltd

1,285 1,149 1,098 95% 159 12% 98 8%

lix

5 Jyoti Limited 2,647 2,376 1,431 60% 271 10% 612.3%

6 Gammon India Ltd+ 5,636 5,297 1,488 28% 339 6% 1843.3%

7 SPML 1,219 1104 420 38% 115 10% 25 2%8 ICSA 1,406 1,115 1,011 90% 291 20% 118 8%

+Revenue from all businesses


Table 99: Performance of Transmission Line Industry



YoY % Change

2010-11 2008-09 2009-10 2010-11 2011-12Transmission Lines 23.4 14,070 13.5 9.2 4 -0.8Transmission Line Towers 12.6 6,600 6.5 19 6.8 -5.2Conductors 10.8 5,670 21.3 0.2 -0.8 4.3Source: IEEMA

This important segment (having a weight of 23.4 per cent in the total industry in FY11) has been

on a downturn over the past four years.

lx


Growth in this industry has consistently decreasing from 13.5 per cent in FY09 to 4 per cent in

FY11. It has further declined to -5.2% in FY12. Transmission line manufacturing sector has its

own issues. Some of them are as under.

Fiscal performance of state transcos and discoms continues to be poor with little or no funds

for planned investment.

Poor credit-worthiness of state utilities is leading to lack of payment security for private

investors.

Procedural delays for both public & private projects and long time taken for the entire

bidding process.

Lack of coordination in transmission planning and implementation activity.

lxi

Growth Drivers 12th Five Year PlanNew Transmission Lines: 109,440 CkmNew Distribution : 1,305,000 CkmInterregional Transmission Capacity: 37,000 MWInvestment of INR 180,000 in 12th PlanRGGVY and R-APDRP Projects

Market CompetitorsKalpataru Power Transmission LtdIVRCLKEC InternationalDiamond Power Infrastructure LimitedJyoti Structures LimitedGammon India LtdUnitech Power Transmission LtdAster Private LtdMan Structurals Pvt. Ltd

Prospective Clients Central Transmission UtilityState Transmission UtilitiesPrivate transmission and distribution companiesEPC players

Entry Opportunity Increasing voltage level for bulk transmission and hence EHV tower testing facilityGood starting as a medium scale manufacturer

Prospects of good business in steel tubular poles because of less RoW requirement

Business RiskFluctuating raw material pricesPricing issue specially with Govt. clientsIndustry is highly dependent and driven by growth in power sectorLack of domestic testing facilities for EHV towers

Commercial conditions such as unrealistic terms of payment, non-availability of price

variation clauses often lead imbalance in price levels.

The decline in growth of tower industry has led the manufacturing facilities to operate on 67%

capacity utilization only.


Tower manufacturing capacity is a mature enough industry in the country. It has been showing

fluctuating performance for last five years. Still future of this segment is bright due to adoption

of higher voltage for power transmission.

Source: IEEMA

This factor is the main growth driver of this industry which needs more testing facility of

transmission towers. Apart from it, PGCIL’s aggressive planning to invest INR 100,000 Crore

for line addition in 12th Plan is being considered as leading demand driver. It is worth to note that

PGCIL’s investment during 11th Plan was INR 55,000 Crore while in the 12th Plan this amount

would be around INR 100,000 Crore.

In the 11th Plan this industry has grown at a CAGR of 6.4%. By the end of 12 th Plan, CEA has

envisaged this market size of INR 18,038 Crore. While looking at the past trend, this industry is

expected to grow up to the size of INR 8,545 Crore in next five years.

4.4 Switchgear & Control Instruments

lxii

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-170

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

4,8

76

5,1

93 6,1

80

6,6

00

6,2

57

6,6

59

7,0

87

7,5

43

8,0

28

8,5

45

INR

Cro

re

CAGR: 6.4%

Figure 85: Tower Industry: Past Performance and Expected Market Size

Figure 86: Switchgear: Circuit Breaker

Switchgears are integral component at every switching point in power systems. Basic function

of switchgear in power system is the measurement

and protection from short circuits and overload fault

currents while simultaneously providing service

continuously to unaffected circuits while avoiding the

creation of an electrical hazard. Switchgear power

system also provides important isolation of various

circuits from different power supplies for safety issues.

4.4.1 Constituents of Switchgear

There are many different types and classifications

of switchgear power systems to meet a variety of

different needs. On the basis of different application,

theses are classified accordingly.

Oil Circuit Breaker (OCB)

The oil in OCBs serves two purposes. It insulates

between the phases and between the phases & ground,

and it provides the medium for the extinguishing of

the arc. When electric arc is drawn under oil, the arc vaporizes the oil and creates a large bubble

that surrounds the arc. The gas inside the bubble is around 80% hydrogen, which impairs

ionization. The decomposition of oil into gas requires energy that comes from the heat generated

by the arc. The oil surrounding the bubble conducts the heat away from the arc and thus also

contributes to deionization of the arc. Main disadvantage of the oil circuit breakers is the

flammability of the oil, and the maintenance necessary to keep the oil in good condition (i.e.

changing and purifying the oil).

Vacuum Circuit Breaker (VCB)

In this breaker, vacuum is being used as the arc quenching

medium. Vacuum offers highest insulating strength; it has

far superior arc quenching properties than any other

lxiii

Figure 87: Oil Circuit Breaker

Figure 88: Voltage Circuit Breaker

medium. When contacts of a breaker are opened in vacuum, the interruption occurs at first

current zero with dielectric strength between the contacts building up at a rate thousands of times

that obtained with other circuit breakers. It consists of fixed contact, moving contact and arc

shield mounted inside a vacuum chamber. The movable member is connected to the control

mechanism by stainless steel bellows .This enables the permanent sealing of the vacuum

chamber so as to eliminate the possibility of leak. A glass vessel or ceramic vessel is used as the

outer insulating body. The arc shield prevents the deterioration of the internal dielectric strength

by preventing metallic vapors falling on the inside surface of the outer insulating cover.

VCB are used for outdoor applications ranging from 22 kV to 66 kV. These are suitable for

majority of applications in rural area.

Gas Circuit Breaker

In this circuit breaker, Sulphar Hexafluoride (SF6) gas is used as the arc quenching medium.

The SF6 gas is an electro negative gas and has a strong tendency to absorb free electrons. The

contacts of the breaker are opened in a high pressure flow of SF6 gas and an arc is struck between

them. The conducting free electrons in the arc are rapidly captured by the gas to form relatively

immobile negative ions. This loss of conducting electrons

in the arc quickly builds up enough insulation strength to

extinguish the arc. The SF6 circuit breakers are very

effective for high power and high voltage service.

Advantages of Gas Circuit Breaker

Due to superior arc quenching property of SF6, such

breakers have very short arcing time

Dielectric strength of SF6 gas is 2 to 3 times that of air, such breakers can interrupt much

larger currents

Gives noiseless operation due to its closed gas circuit

Closed gas enclosure keeps the interior dry so that there is no moisture problem

There is no risk of fire as SF6 is non inflammable

There are no carbon deposits

Low maintenance cost, light foundation requirements and minimum auxiliary equipment

lxiv

Figure 89: Gas Circuit Breaker

Disadvantages of Gas Circuit Breaker

High cost of SF6

SF6 gas has to be reconditioned after every operation of the breaker, additional equipment is

required for this purpose

Instrument Transformers

Instrument transformers are used for measurement and protective application, together with

equipment such as meters and relays. It is also a part of switchgear family. Their role in electrical

systems is of primary importance as they are a means of "stepping down" the current or voltage

of a system to measurable values, such as 5A or 1A in the case of a current transformers and

110V or 100V in the case of a voltage transformer. This offers the advantage that measurement

and protective equipment can be standardized on a few values of current and voltage. Current

transformers, together with Voltage Transformers (VT) (or Potential Transformers (PT)), are

known as instrument transformers.

Current Transformers

When current in a circuit is too high to directly

apply to measuring instruments, a current

transformer produces a reduced current accurately

proportional to the current in the circuit, which can

be conveniently connected to measuring and

recording instruments. A current transformer also

isolates the measuring instruments from what may

be very high voltage in the monitored circuit.

Current transformers are commonly used in metering and protective relays in the electrical

power industry.

Voltage Transformers

When voltage level of a circuit is too high to

directly apply to measuring instruments, a voltage

lxv

Figure 90: Current Transformer

Figure 91: Voltage Transformer

http://en.wikipedia.org/wiki/Electrical_power_industry


http://en.wikipedia.org/wiki/Protective_relay

transformer produces a stepped down voltage level accurately proportional to the voltage level of

the circuit, which can be conveniently connected to measuring and recording instruments. A

voltage transformer also isolates the measuring instruments from what may be very high voltage

in the monitored circuit. Voltage (Potential) transformers are commonly used in metering and

protective relays in the electrical power industry.


Table 101: Bharat Heavy Electricals Limited (BHEL)


Nature of Business

Manufacturing EPC Oil & Gas R&D

Products/Services

Power Transformers Switchgear BTG Sets BOP

Leading Product/Service Power Transformers BTG Sets Switchgear

Infrastructure Mfg unit: 15 Business office: 15 Service centre: 8



Technology Sourcing

Siemens AG Germany Germany ABB Switzerland General Electric USA

Global Footprints More than 70 countries

Indian Clientele Power Utilities, Oil & Gas Sector, Mining Sector, Indian Railways, EPC

Contractors, Cement Industry, Steel IndustryCertification ASME, API

Table 102: Siemens India Limited

Year of Establishment 1956-57 (In India)

Nature of Business

Manufacturing EPC Services R&D

Products/Services Power Transformers

lxvi


http://en.wikipedia.org/wiki/Protective_relay

Switchgear Network Protection & Control System Automation & Robotics Electric Motors & Alternators Substation Erection Consumer Products

Leading Product/Service Power Transformers Switchgear System Automation

Infrastructure Mfg unit: 8 Sales offices: 19 R&D center: 10



Technology Sourcing Indigenous technologyGlobal Footprints More than 190 countries


Contractors, Cement Industry, Steel IndustryCertification IEC, ANSI, IEEE, CPRI, ISO 9001, ISO 14001, OHSAS 18001

Table 103: ABB Limited

Year of Establishment 1949 (In India)

Nature of Business


Products/Services

Power Transformers Switchgear Network Protection & Control System Automation & Robotics Electric Motors & Alternators Substation Erection Consumer Products


Infrastructure

Mfg unit: 12 Marketing offices: 23 Service center: 8 Logistic warehouse: 3 Training centers: 4 Power & Automation engineering centers: 2 Channel partners: 550



Technology Sourcing Indigenous technology

lxvii

Global Footprints More than 100 countries


Contractors, Cement Industry, Steel Industry

CertificationIEC, ANSI, IS, KEMA, BS, CSA, UL, ATEX, CE, CPRI, ISO 9001, ISO 14001, OHSAS 18001

Table 104: Crompton Greaves Limited


Nature of Business


Products/Services


Leading Product/Service

Power Transformers Switchgear Rotating Machines System Automation

Infrastructure Mfg unit: 20 More than 30 communication points in India



Technology Sourcing For SLIM Transformers with Dupont’s Nomex Thermal Insulating

Technology

Global Footprints Indonesia, Belgium, Hungary, Canada, USA, UK, Ireland, Netherland,

Sweden, France, UAE, China, Australia, New Zealand, Curacao



CertificationISO 9001, ISO 14001, OHSAS 18001, CPRI, IEC, ANSI, IS, KEMA, BS, CSA, UL, ATEX, CE

Table 105: Alstom (Areva) T&D India Limited


Nature of Business


Products/Services Power Transformers Gas Insulated Switchgear

lxviii

Switchgear Network Protection & Control Electric Motors & Alternators Substation Erection


Infrastructure

Mfg unit: 8 Sales offices: 25 R&D center: 4 Engineering center: 2 Channel partners: 500

Annual Turnover(20010-11)

INR 4,037 Crore



Contractors, Cement Industry, Steel IndustryCertification IEC, ANSI, IEEE, ISO 9001, ISO 14001, OHSAS 18001

Table 106: Biecco Lawrie Limited


Nature of Business Manufacturing Turnkey Projects Electrical Repairs

Products/Services Switchgear Electronics & Control (Relays Division)

Leading Product/Service SwitchgearAnnual Turnover(2009-10)

INR 66 Crore


Indian Clientele Power Utilities, Indian Railways, EPC Contractors, Cement Industry, Steel

IndustryCertification ISO 9001-2008, ISO-14000

Table 107: Jyoti Limited


Nature of Business


Products/Services Switchgear Electronics & Control (Relays Division) Rotating Electrical Machines

lxix

Hydel System, Electrical Pump

Leading Product/Service Switchgear Rotating Electrical Machines


INR 395 Crore and INR299 Crore

Technology Sourcing Toshiba Corporation, JapanGlobal Footprints Bhutan, Oman, Nepal,


Contractors, Cement Industry, Fertilizer Industry, Steel IndustryCertification ISO 9001

Table 108: Vishal Transformers & Switchgears (P) Ltd

Year of Establishment 1970Nature of Business Manufacturing

Products/Services

Instrument Transformers Auxiliary Transformers Distribution Transformers Special Purpose CT & VT Metering Cubicle

Leading Product/Service Instrument TransformersInfrastructure Mfg unit: 3Technology Sourcing Indigenous

Indian Clientele Various SEBs of ctates such as: UP, Uttarakhand, Rajasthan, Punjab, Haryana Entities such as: BHEL, Siemens, ABB, CGL, ALSTOM, L&T, CGL,

Nagarjuna Construction Company, Indian Railways, Subhash ProjectsCertification ISO 9001-2008, IS

Table 109: Heptacare Power Industries Pvt. Limited

Year of Establishment 1994Nature of Business ManufacturingProducts/Services Instrument TransformersLeading Product/Service Instrument TransformersInfrastructure Mfg unit: 1Technology Sourcing Indigenous

Indian Clientele

Various SEBs of states such as: UP, UttraKhand, Rajasthan, Punjab, Haryana, J&K, HP, Chhattisgarh, Odissa

Power utilities such as: Areva, ABB, BBMB, BHEL, CGL, INRCL International Ltd, KEC International, Nagarjuna Construction

Certification ISO 9001-2000, IEC,IS

Table 110: Hivoltrans Electricals Pvt. Ltd


lxx


Products/Services Instrument Transformers Isolating Transformers HV Testing Transformers

Leading Product/Service Instrument TransformersInfrastructure Mfg unit: 1Technology Sourcing Indigenous

Indian Clientele

Government utilities such as: MSEB, ASEB, MPSEB, GEB, NEEPCO, BBMB, APSEB, RSEB, GRIDCO, WBSEB

Others such as: ABB, ALSTOM, CGL, Bharat Bijlee, EMCO, Essar, GAIL, IOCL, Railways, KRIBHCO, Jyoti Enterprises, Suzlon Energy, Torrent Power, UltraTech

Certification ISO 9001:2000, IS

Table 111: Kappa Electricals


Products/Services Instrument Transformers Control & Auto Transformers Relays, Switches and Fuses

Products/Services Instrument TransformersTechnology Sourcing IndigenousGlobal Footprint Indian Subcontinent, East Asia, Middle East and South East Asia

Indian Clientele Various SEBs Private Utilities Industrial Consumers

Certification ISO 9001:1994, BS, IEC, AS, DIN, KEMA




ATO (V)

Op Ex (W)



1 BHEL 43,337 33,856 23,209 69% 9,538 22%6,01

114%

2Siemens India Limited

12,253 3,895 2,162 56% 1,409 12% 868 7%

3 ABB Limited 7,693 7,126 5,518 77% 393 5% 185 2%4 Crompton Greaves 6,276 5,018 2,828 56% 937 15% 694 11%

lxxi

Limited

5Alstom (Areva) T&D India Limited*

4,037 3,718 2,875 77% 319 8% 65 2%

6 Biecco Lawrie* 66 62 39 63% 4 6% 2 3%7 Jyoti Limited 395 341 270 80% 54 14% 18 5%

*Figure for FY10


The switchgear industry in India manufactures the entire range of circuit breakers from bulk oil,

minimum oil, and air blast, vacuum; to Sulphar Hexafluoride (SF6) as per standard

specifications. There are a few leading circuit

breaker manufacturers in the country. Rests are

medium scale manufacturers. In the field of instrument transformer also there are eight to ten

players who are majorly involved in manufacturing of instrument transformers at EHV level

only. Other players manufacture these components at sub-transmission and distribution voltage

level. At the medium and low voltage level, it is an unorganized market and regional players are

involved in doing business in their area of reach.

After two consecutive years of double-digit

growth, the switchgear industry had to contend

with a 2.4 per cent fall in FY12. In FY11, the

segment had grown by 21.2% that had come over

and above a 14.5% growth in FY10. It is

estimated that the size of the switchgear market,

(not including domestic switches), was around

INR 9,100 Crore in 2010-11.

Table 113: Performance of Switchgear Industry



YoY % Change

2011-11 2008-09 2009-10 2010-11 2011-12Switchgear 15.1 9,100 0 14.5 21.2 -2.4Power Contactors 2.6 1,000 -17.8 41 28.7 -10.4LT Circuit Breakers 3.6 1,360 -1 29.4 19.5 -5.8MCBs 2.8 1,050 9.7 23 7.7 15.5

lxxii

2006-07 2007-08 2008-09 2009-10 2010-110

200

400

600

800

1,000

1,200

705

614

751813

1,105

INR

Cror

e


Figure 92: Export of Switchgear Instruments

S/F and F/S Units 0.5 207 -11.1 5.3 3.8 -4.3HT Circuit Breakers 5.6 2,140 2.4 -5.8 28.4 -5.8Source: IEEMA

4.4.5 Demand Segments

Utilities: HV and EHV demand majorly comes from the utilities. India's power generation

capacity of 2,300 MW in 1950 expanded to 200,000 MW in 2012. With the 12th Plan the capacity

is expected to increase by around 75,000 MW. The Government is focusing on increasing the

penetration of power supply in villages. Schemes like APDRP and RGGVY are providing an

excellent opportunity for the LV and MV switchgear market with about 10-15% villages yet to

be electrified.

Industrial Segment: An increase in process automation levels observed which support push-

buttons, contactors and switching relays, as well as the protection relays market, which finds

application extensively for motor control. Investment in new infrastructural setup is set to

increase the market for Insulated Switchgears, Ring Main Units, Molded Case Circuit Breakers,

Air Circuit Breakers and Control & Relay Panels.

lxxiii


Power Plant Modernization and Refurbishment: As in other parts of the world, numerous

power plants in India are nearing the end of their services plan, thus requiring overhauling and

modernization. This includes replacement of existing transformers and LV, MV and HV

switchgear, which are on average over 30 years old. Power plant modernization and

refurbishment is expected to additionally support growth of the switchgear market.

lxxiv

Growth Drivers 12th Five Year PlanFocus on RGGVY schemesPower Plant Modernization and RefurbishmentMore focus on higher transmission and High Voltage Distribution SystemIntroduction of gas insulated switchgears which require less spaceIncreasing system automation

Market CompetitorsSiemens India LimitedABB LimitedCrompton Greaves LimitedBHELSchneider ElectricPentagon Switch GearBiecco Lawrie LimitedJyoti LimitedPower Protection

Prospective Clients Central Transmission UtilityState Transmission UtilitiesExisting & forthcoming private distribution companiesEPC companiesMajor industries e.g. Petrochemicals, Mining, Steel/Metallurgical, Ship building, Engineering, Cement, Railway, Defense

Entry Opportunity Around 15-20 leading manufacturers in countryPresent market is dominated by multinational players, therefore good opportunity for new playersThe switchgear industry has traditionally been low on technology, but with changing times automation has ushered in newer concepts such as soft starters, intelligent relays, compact intelligent switchgear and energy efficient switchgear

Business Risk & IssuesRequires good technological partnership or in house R&D and testing facilitiesCompetitive pricingVolatile price of raw material

Alternative Energy Sources: The India Government continues to research and invest in

renewable energy sources such as wind, solar-thermal and hydroelectric power. The increase in

investment in alternative energy sources is also expected to support market growth, as LV and

MV switchgear products are required for general protection as well as switching. The MCCB

and MCB markets are expected to benefit considerably from alternative energy expansion.


Switchgear industry has been growing for last years at a CAGR of 7.9%. Only in FY 2011-12 it

witnessed negative growth. Still future of this product is good enough due to R&M plans of old

power plants. This factor is the main growth driver of this industry.

Source: IEEMA

By the end of 12th Plan, CEA has envisaged this market size of INR 22,000 Crore. While looking

at the past trend, this industry is expected to grow up to the size of INR 12,977 Crore.

4.5 Transformer

A transformer is a static machine used for

transforming voltage level from one circuit to another

circuit without changing frequency. By using a step

lxxv

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-170

2,000

4,000

6,000

8,000

10,000

12,000

14,000

6,5

57

6,5

57

7,5

08 9

,10

0

8,8

82

9,5

81

10

,33

6

11

,15

1

12

,03

0

12

,97

7

CAGR: 7.9%

Figure 93: Switchgear Industry: Past Performance and Expected Market Size

Figure 94: Transformer

up transformer at the sending end of the power system network we transmit the power at high

voltage. This power may not be distributed to the consumers directly and must be stepped down

to the desired level at the receiving end with help of step down transformer.

Table 115: Types of Transformer

Power Transformer Distribution Transformer

Instrument Transformer

Rating Above 1 MVA, 33 kV Up to 1 MVA, 11 kV 440 Volts to 1200 kV

Application Generation, Transmission, Sub-transmission and Distribution

Distribution Measuring & Protection

Types Oil filled & Dry Type Oil filled & Dry type Oil filled & Dry type

4.5.1 Major Components of Transformer

Windings

The conducting material used for the windings depends upon

the application, but in all cases the individual turns must be

electrically insulated from each other to ensure that the

current travels throughout every turn. Larger power

transformers operating at high voltages may be wound with

copper rectangular strip conductors insulated by oil-impregnated paper and blocks of pressboard.

Core

For efficient flux linking between the two windings, one low

reluctance magnetic path common to both of them should be

provided in the transformer. This low reluctance magnetic

path in transformer is known as core of transformer. The

main problem with transformer core is the hysteresis

and eddy current loss in transformer. Hysteresis loss in

transformer mainly depends upon its core materials. The core

steel which has under gone through the both silicon alloying and cold rolling treatments is

lxxvi

Figure 96: Core

Figure 95: Transformer Windings

commonly known as CRGOS or Cold Rolled Grain Oriented Silicon Steel. This material is now

universally used for manufacturing for transformer core.

Conservator Tank

Two main roles of conservator: whenever high

electrical stress are produces inside the transformer

due to fault then temperature raise of oil it gives

contraction effect & gases also produced inside the

main tank then it takes a path to release the pressure

via Buchholz relay to the conservator & breather

releases the gas.

Conservator tank is provided to maintain the oil level in the transformer. It is never filled with oil

up to the neck. Thermal expansion nature of the oil is kept in the view and therefore oil is filled

only up to 3/4th of conservator tank level.

Radiator

Radiators are used in a transformer to cool the

transformer oil through natural air or forced air

flowing in these radiator fins. As the transformer oil

temperature goes down due to cooling it goes to the

transformer tank from bottom, cool the windings and

gets heated, and then returns to the radiator for next

cooling. This cycle repeats as the oil flow is also natural due difference in temperature of oil on

bottom and top. In big power transformers this oil circulation is forced by oil pumps for effective

cooling. The radiator has many small fins and there are 4-10 radiator banks in a transformer

depending on capacity and make of the

transformer.

Buchholz Relay

Buchholz Relay in transformer is an oil container

housed the connecting pipe from main tank to

lxxvii

Figure 97: Conservator Tank

Figure 98: Radiator

Figure 99: Buchholz Relay

conservator tank. It has mainly two elements. The upper element consists of a float. The float is

attached to a hinge in such a way that it can move up and down depending upon the oil level in

the Buchholz Relay Container. One mercury switch is fixed on the float. The alignment of

mercury switch hence depends upon the position of the float. The lower element consists of a

baffle plate and mercury switch. This plate is fitted on a hinge just in front of the inlet (main tank

side) of Buchholz Relay in transformer in such a way that when oil enters in the relay from that

inlet in high pressure the alignment of the baffle plate along with the mercury switch attached to

it, will change. In addition to these main elements a Buchholz Relay has gas release pockets on

top. The electrical leads from both mercury switches are taken out through a molded terminal

block.

Bushings

A bushing is a hollow electrical insulator through which a

conductor may pass. The bushing is a

hollow insulating liner that fits through a hole in a wall or

metal case, allowing a conductor to pass along its centre

and connect at both ends to other equipment. The purpose

of the bushing is to keep the conductor insulated from the

surface it is passing through. Bushings are often made of

wet-process fired porcelain, and may be coated with a semi-conducting glaze to assist in

equalizing the electrical stress along the length of the bushing.

The inside of the bushing may contain paper insulation and the bushing is often filled with oil to

provide additional insulation. Bushings for medium-voltage and low-voltage apparatus may be

made of resins reinforced with paper. The use of polymer bushings for high voltage applications

is becoming more common. The largest high-voltage bushings made are usually associated

with high-voltage direct-current converters.

4.5.2 Market Analysis

Transformer is the most costly and critical component in a substation. It accounts for 10-15% of

the total cost of switchyard in a power system. The Indian transformer industry is more than five

decade old and manufactures all types of transformers. The industry enjoys a good reputation in

lxxviii

Figure 100: Bushings

terms of quality, price and delivery in the domestic as well as overseas markets even in advanced

countries. The Indian transformer industry can generally be divided into distribution

transformers, power transformers, generating transformer and other types of special transformers

for welding, traction, furnace etc.

Past Performance

Power transformers account for about 65-70% of the total transformer industry in MVA terms.

Distribution transformers account for the remaining 30-35% of the total transformer industry in

MVA terms. A transformer could either be oil filled or dry type by nature, with voltage ranging

from 1.1 kV-33 kV.

Table 116: Transformer: Domestic Demand Vs Supply

2006-07 2007-08 2008-09 2009-10 2010-11Installed manufacturing Capacity (MVA) 1,13,360 1,44,190 1,52,065 1,72,065 2,10,000Production (MVA) 90,810 1,07,723 1,22,487 1,29,049 1,68,000Total Transformer Demand (MVA) 1,39,364 1,60,129 1,83,988 2,11,402 2,42,901

The transformer industry grew by a feeble 1.2% in FY12 as against a very healthy 13.5% in

FY11. While power transformers have performed consistently, it is distribution transformers that

have shown erratic trend. In FY12, the distribution transformer category suffered a 3.3% against

the 7.4% growth seen in power transformers.

Table 117: Performance of Transformer Industry



YoY % Change

2010-11 2008-09 2009-10 2010-11 2011-12Transformers 20.6 12,350 -1.2 9.1 13.5 1.2Power Transformers 8.6 5,150 25.8 17.2 13.2 7.4Distribution Transformers 12 7,200 -16.9 3 13.8 -3.3Source: IEEMA

Demand Segments

The Indian transformer manufacturing is a

mature industry with large manufacturing base. Huge capacity has been added by several

manufacturers over the last 5-7 years based on the planned programs. Indian Electrical

lxxix

Figure 101: Demand Drivers fo Transformer

Equipment industry over the years has also

gained global acceptance and India has

emerged as a preferred destination for

sourcing of quality, reliable and competitively

priced equipment including transformers.

Generator Transformers: These are used

primarily as step up transformer in power

generation plants. Power transformer is said

to be one of the main and costly plant

equipment. With the 12th Plan the capacity is expected to increase by around 75,000 MW which

reflects the requirement of 96,837 MVA of generator transformers.

Transformation Capacity: Substation capacity has been added satisfactorily in 11th plan and it

will continue in the 12th plan also because of good target of generation capacity addition.

Transformation capacity addition is the primary requirement for evacuation of power from any

generating power plant. Therefore this segment will keep a high demand of the tune of 60-65

thousand MVA per annum. Transformation capacity in 11th FYP has increased at CAGR of 54%.

12th Plan also, is likely to perform in same way in order to achieve the national target.

Table 118: Transformer: Demand Creators

Transformer Demand Segment 2012-13 2013-14 2014-15 2015-16 2016-17 TOTALGT Capacity (MVA) 20,497 19,011 19,974 21,090 16,265 96,837Transformation Capacity (MVA) 67,372 62,488 65,654 69,321 53,462 318,297Industry Installations (MVA) 3,369 3,124 3,283 3,466 2,673 15,915

Export Demand (MVA) 18,000 21,420 25,490 30,333 36,096 131,339Replacement Demand (MVA) 20,000 20,000 20,000 20,000 20,000 100,000Total (MVA) 129,238 126,043 134,401 144,210 128,496 662,388

Industrial Installation: Whatever loom in industrial growth was to happen, has occurred

already. Therefore, in future more development is obvious. Although Industrial segment

contributes only 2% of total demand but it encourages customized product which can give better

profitability. Industries such as steel, oil, cement, textile, sugar, heavy engineering etc are the

segment growth drivers.

lxxx

15%

48%

2%

15%

20%Generator Transformer

Transformation Capacity

Industrial Demand

Replacement

Export

Export Demand: In the global market, performance of Indian product is acknowledged as

technically at par with the leading international companies since Indian transformer industry is

matured enough as a reliable supplier, it is exporting transformer in various parts of the world

including countries like USA, Europe, African Countries, Cyprus, Syria, Iraq and other Middle

East countries.

Table 119: Transformer Exports from India

Figures in INR Crore 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 CAGRUp to 650 kVA 65.1 175.9 234.7 251.2 379.1 460.1 48%650 kVA-10 MVA 38 127.6 161.8 200.2 189 212.4 41%Above 10 MVA 307.6 488.7 699 1273.5 1221.2 748.9 19% 410.7 792.2 1095.5 1724.9 1789.3 1421.4 28%


Over a period of six years industry has exported the transformers at a robust CAGR of 28%. In

this, small manufacturers are now emerging as leading exporters in small transformer which has

seen highest growth rate of 48%.

Replacement Demand: As in other parts of the world, numerous power plants in India are

nearing the end of their service plan, thus requiring overhauling and modernization. This

includes replacement of existing transformers, which are on average over 30 years old and the

replacement of distribution and power transformers. BEE has started the program of efficiency

wise star rating of the transformers. It has provided additional market to the industry which ill

drive the extensive use of more efficient and reliable transformers in the future. Further, the

strengthening of the transmission and distribution grid under the R-APDRP scheme will be

growth driver for the industry.


Table 120: Transformer Industry: Prominent Players

Transformers & Rectifiers Vijai Electricals BHEL Siemens India Limited ABB Limited Crompton Greaves Limited Alstom (Areva) T&D India Ltd

Key Attributes Over all more than 300 players in market Volume wise 70:30 ratio between organized and

unorganized market Organized market consist 15-20 established

players who dominate Power Transformer segment

lxxxi

Bharat Bijlee EMCO Voltamp RTS Power Accurate Transformer TELK IMP Diamond Power Infrastructure Limited

Local manufacturers dominate Distribution Transformer segment

Lack of EHV transformer testing facilityProspective Clients Central & State Transmission Utilities EPC Companies State & Private Discoms Major industries e.g. Heavy Engineering, Cement,

Steel, Railway, Defense etc.

Table 121: Bharat Heavy Electricals Limited (BHEL)


Nature of Business

Manufacturing EPC Oil & Gas R&D

Products/Services

Power Transformers Switchgear BTG Sets BOP

Leading Product/Service Power Transformers BTG Sets Switchgear

Infrastructure Mfg unit: 15 Business office: 15 Service centre: 8



Technology Sourcing

Siemens AG Germany Germany ABB Switzerland General Electric USA

Global Footprints More than 70 countries across the world


Contractors, Cement Industry, Steel IndustryCertification ASME, API

Table 122: Siemens India Limited

Year of Establishment 1956-57 (In India)

Nature of Business


lxxxii

Products/Services



Infrastructure Mfg unit: 8 Sales offices: 19 R&D center: 10



Technology Sourcing Indigenous technologyGlobal Footprints More than 190 countries across the world


Contractors, Cement Industry, Steel IndustryCertification IEC, ANSI, IEEE, CPRI, ISO 9001, ISO 14001, OHSAS 18001

Table 123: ABB Limited


Nature of Business


Products/Services

Power Transformers Switchgear Capacitors Network Protection & Control System Automation & Robotics Electric Motors & Alternators Substation Erection Consumer Products


Infrastructure

Mfg unit: 12 Marketing offices: 23 Service center: 8 Logistic warehouse: 3 Training centers: 4 Power & Automation engineering centers: 2 Channel partners: 550

Annual Turnover INR 7,693 Crore and INR 6,372 Crore

lxxxiii

(20010-11 and 2009-10)Technology Sourcing Indigenous technologyGlobal Footprints More than 100 countries across the world



CertificationIEC, ANSI, IS, KEMA, BS, CSA, UL, ATEX, CE, CPRI, ISO 9001, ISO 14001, OHSAS 18001

Table 124: Crompton Greaves Limited


Nature of Business


Products/Services


Leading Product/Service

Power Transformers Switchgear Rotating Machines System Automation

Infrastructure Mfg unit: 20 30 Communication points in India



Technology Sourcing For SLIM Transformers with Dupont’s Nomex Thermal Insulating

Technology

Global Footprints Indonesia, Belgium, Hungary, Canada, USA, UK, Ireland, Netherland,

Sweden, France, UAE, China, Australia, New Zealand, Curacao



CertificationISO 9001, ISO 14001, OHSAS 18001, CPRI, IEC, ANSI, IS, KEMA, BS, CSA, UL, ATEX, CE

Table 125: Alstom (Areva) T&D India Limited


Nature of Business


lxxxiv

Products/Services

Power Transformers Gas Insulated Switchgear Switchgear Network Protection & Control Electric Motors & Alternators Substation Erection


Infrastructure

Mfg unit: 8 Sales offices: 25 R&D center: 4 Engineering center: 2 Channel partners: 500

Annual Turnover(20010-11)

INR 4,037 Crore



Contractors, Cement Industry, Steel IndustryCertification IEC, ANSI, IEEE, ISO 9001, ISO 14001, OHSAS 18001

Table 126: Transformers & Rectifiers


Products/Services

Power Transformers Distribution Transformers Rectifier Transformers Furnace Transformers Reactors

Leading Product/Service Transformers

InfrastructureMfg unit: 3Strategic unit: 3 (for transformer component mfg)


INR 577 Crore and INR 515.09 Crore


Global FootprintsSouth Africa, Ethiopia, Bhutan, Canada, Congo, Tanzania, Bangladesh, Mozambique, Oman, Iran, Nepal, Kenya, Ghana, USA, Australia, Uzbekistan, Saudi Arabia, UK, Philippines, UAE, Bangladesh


Contractors, Cement Industry, Steel IndustryCertification ISO 9001–2008, ISO 14001–2004, OHSAS 18001–2007

lxxxv

Table 127: Vijai Electricals


Products/Services Power Transformers Distribution Transformers Switchgear


Infrastructure Mfg unit: 4 (India) + 2 (Abroad) Strategic unit: For indigenous component development



Technology Sourcing Daihen Corporation, JapanGlobal Footprints USA, Mexico, Venezuela, Brazil

Indian Clientele

APEB, MSEB, Gujarat SEB, Rajasthan SEB, ABB, UPSEB, Asam SEB, BSEB, BSES, Enercon India Ltd, HSEB, KSEB

Kalpataru Power, PGCIL, NTPC, NPCL, Reliance Energy, Wilson Power Solutions, Siemens Ltd

CertificationLloyds-UK, Crown Agents- UK, BSI Inspectorate Griffith, OMIC Japan, CAPE- Thailand, Tubescope Vecto GmbH Germany

Table 128: Voltamp


Nature of Business Manufacturing Services

Products/Services

Transformers Unitized Substation Induction Furnace Lighting Arrestor Electrical Maintenance

Leading Product/Service TransformersInfrastructure Mfg unit: 2Annual Turnover(2010-11 and 2009-2010)


Technology Sourcing Indigenous technologyGlobal Footprints India, Nepal, Bhutan, Indonesia, Sri Lanka, Middle East Asian CountriesIndian Clientele NTPC, ONGC, NALCO, IOCL, BPCL, AEC-SEC, GSFC, GACLCertification ISO 9001 – 2000, ISOQAR Accreditation, IEC

Table 129: Bharat Bijlee



Products/Services Power transformers: Station transformer, Unit Auxiliary transformer

lxxxvi

Elevator System: Gearless motors Motors: 3-phase induction motors, Pumps, Sub Station erection projects


Infrastructure Mfg unit: 1 Branch Office: 13




Global Footprints Bangladesh, Tanzania, Algeria, Indonesia, Nepal, Philippines, Kenya,

Namibia, Oman, UAE, Egypt, Jordan, South Africa

Indian Clientele AAI, NTPC, PGCIL, BSEB, BSES, MPPTCL, MSETCL, TATA POWER,

TORRENT POWER, RILAINCE INFRA, UPPTCL, WBSETCL, BGR Energy, NALCO, Singareni Collieries

Certification ISO 9001–2008, BIS, Canadian Standards Association

Table 130: EMCO



Products/Services

Transformers Sub-station EPC Energy meters Transmission Line & Towers

Leading Product/Service Transformers EPC

Infrastructure Mfg unit: 6Annual Turnover(2010-11 and 2009-10)



Global Footprints Presence across 45 nations America, Europe, Middle-East countries, Asia Pacific

Indian Clientele Power Utilities, Oil & Gas Sector, Mining, EPC Contractors, Cement

Industries, Steel IndustriesCertification ISO 9001–2008, ISO 14001-2004, OHSAS 18001-2007, IS, IEC, ANSI


Table 131: Competitor Analysis


ATO (V)

Op Ex (W)


lxxxvii


1 BHEL 43,337 33,856 23,209 69% 9,538 22%6,01

114%

2Siemens India Limited

12,253 3,895 2,162 56% 1,409 12% 868 7%

3 ABB Limited 7,693 7,126 5,518 77% 393 5% 185 2%

4Crompton Greaves Limited

6,276 5,018 2,828 56% 937 15% 694 11%

5Alstom (Areva) T&D India Ltd*

4,037 3,718 2,875 77% 319 8% 65 2%

6Transformers & Rectifiers

577 510 454 89% 66 11% 40 7%

7 Vijai Electricals 1,849 1,689 1,350 80% 160 9% 18 1%8 Voltamp 526 470 442 94% 67 13% 51 9%9 Bharat Bijlee** 781 685 535 78% 96 12% 60 7%10 EMCO 1049 1054 900 - (4.7) - (67) -

*Figures for 2009-10; **Figures for 2011-2012

4.5.5 Growth in Market Size

Transformer industry has witnessed consistent growth in the market size and this trend is likely

to continue in the future also. Indian small and medium transformer manufacturers are expected

to gain momentum due to various government reform programs.

Source: IEEMA

lxxxviii

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-170

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

10

,09

5

9,9

73

10

,88

1

12

,35

0

12

,49

8

13

,18

4

13

,90

7

14

,67

0

15

,47

4

16

,32

3

INR

Cro

re

CAGR:

5.5%

Figure 102: Transformer Industry: Past Performance and Expected Market Size

Export will also be a good growth driver for this industry. In the 11 th Plan this industry has

grown at a CAGR of 5.5%. By the end of 12 th Plan, CEA has envisaged this market size of INR

29,500 Crore. While looking at the past trend, this industry is expected to grow up to the size of

INR 16,323 Crore.

4.5.6 Prospective Clients

Transmission Utilities

Large amount of projects planned by PGCIL and State transmission Utilities.

Nodal investors in transmission sector.

Distribution Utilities

Large number of projects coming up under R-APDRP and RGGVY.

Thrust on decreasing the AT&C losses: investments in distribution and sub transmission

infrastructure.

EPC Companies

EPC players are flooded with projects due to transformation in utility approach from cost

plus to turnkey basis.

Better commercial arrangement can be outlined.

Repeating orders.

Easy reach to clients exposed to limited established players (transformer manufacturers).

4.5.7 Business Risk

Industry Level risk

Almost all major players have increased their capacities leading to excess supply situation in

the industry.

Pricing becoming an issue especially with Govt. clients.

CRGO Steel and Copper are the key raw material, which are highly price volatile which can

cause unfavourable impacts on pricing.

Transformer Industry is highly dependent and driven by growth in power sector.

lxxxix

Any dent in performance of sector affects the growth of the industry.

Consumer Level Risk

Choice of states and schemes: Certain states and schemes have had huge execution

challenges, administrative and payment issues.

The L1 guidelines are objective leaves no room for subjective matters like quality.

Unilateral testing by State Utilities: Leading to false results and develops dispute. Also

bottleneck in High Voltage Transformer Testing in the Country.

Local administrative and executive staff at utilities: Results in to delayed payments.

4.6 Energy Meter

An electricity meter or energy meter is a device that measures the amount of electric energy

consumed by a residence, business, or an electrically

powered device. Electricity meters are typically calibrated

in billing units, the most common one being the kilowatt

hour (kWh). Periodic reading of electric meters establishes

billing cycles and energy used during a cycle.

In settings when energy savings during certain periods are desired, meters may measure demand,

the maximum use of power in some interval. ‘Time of Day’ metering allows electric rates to be

changed during a day, to record usage during peak high-cost periods and off-peak, lower-cost,

periods. Also, in some areas meters have relays for demand response shedding of loads during

peak load periods.

4.6.1 Types of Energy Meter

Electricity meters operate by continuously measuring the instantaneous voltage (volts) and

current (amperes) and finding the product of these to give instantaneous electrical power (watts)

which is then integrated against time to give energy used (joules, kilowatt-hours etc.). Meters for

smaller services (such as small residential customers) can be connected directly in-line between

source and customer. For larger loads, more than about 200 ampere of load, current transformers

xc

Figure 103: Energy Meter

are used, so that the meter can be located other than in line with the service conductors. The

meters fall into two basic categories, electromechanical and electronic.

Electromechanical Meter

The most common type of electricity meter is the

electromechanical induction watt-hour meter. The

electromechanical induction meter operates by

counting the revolutions of an aluminum disc which

is made to rotate at a speed proportional to the

power. The number of revolutions is thus

proportional to the energy usage. The voltage coil

consumes a small and relatively constant amount of

power, typically around 2 watts which is not

registered on the meter. The current coil similarly

consumes a small amount of power in proportion to the square of the current flowing through it,

typically up to a couple of watts at full load, which is registered on the meter.

Electronic Meter

Electronic meters display the energy used on an

LCD display, and can also transmit readings to

remote places. In addition to measuring energy used,

electronic meters can also record other parameters of

the load and supply such as maximum demand,

power factor and reactive power used etc. They can

also support time-of-day billing, for example,

recording the amount of energy used during on-peak

and off-peak hours.

Now a day, electronic meters are able to store the data for a long time which can be downloaded

at any time of need. Meters with battery back up are able to transmit the data even when main

power supply is off. Various kinds of signaling and indication functions are available to detect

xci

Figure 104: Electromechanical Meter

Figure 105: Electronic Meter

any kind of tempering or violation of safety norms. All of these functions are controlled through

inbuilt electronic microprocessor.

HTMD Meter

This is instrument transformers supported metering

system. This type of meter is connected through the

secondary of current transformer and potential

transformer. These are used at the points in power

system where voltage and current both are at very high

level and their direct measurement is not possible.

Technical Specification:

Type: 3 Phase

Accuracy Class: 0.1, 0.2, 0.5

Current Rating: For the load above 200 Ampere where CT is used

Voltage Rating: For the system above 440

Volts where PT is used

Application:

Generating Stations (Apex Meters)

EHV Substations (Apex Meters)

Distribution Substations

HT Consumers

LTCT Meter

This is current transformer supported metering

system. This type of meter is connected through

the secondary of current transformer but potential

transformer is not used. These are used at the

points in power system current is at very high

level and its direct measurement is not possible.

xcii

Figure 106: HTMD Meter

Figure 107: Apex Meters

Figure 108: LTCT Meter


Type: 3 Phase

Accuracy Class: 0.5, 1.0

Current Rating: For the load above 200 Ampere where CT is used

Voltage Rating: For the system up to 440 Volts where PT is not used

Application:

HT Consumers

LT Consumers

DT Metering

LT Whole Current Meter

These meters are free from the use of instrument transformers. These meters are put in to the

path of main electrical circuit. Whole current implies the fact that the entire load current in the

electrical circuit passes through the meter. These energy meters are installed for single and three

phase supply connection types with different current ratings. They are suitable for low voltage

residential supply connections, small and medium

enterprises and low voltage distribution transformer metering. They are designated with single or

three phase supply type, current carrying capacity and accuracy class indices of 1.0 and 2.0 in

compliance with international metering standards.


Type: 1 Phase and 3 Phase

Accuracy Class: 1.0, 2.0

Current Rating: For the load up to 100 Ampere

where CT is not used

Voltage Rating: For the system up to 440 Volts

where PT is not used

Application:

Domestic Consumers

xciii

Figure 109: LT Whole Current Meter

Small Commercial Complexes etc.

Smart Metering System: Prepaid Meter

Smart metering has gained popularity by bringing

benefits to all stakeholders in the utilities industry.

Different payment methods available via smart meters

for the amount of energy consumed help end users to

increase payment transparency and enable utilities to

easily comply with regulations on consumer rights.

Prepaid service options have become an attractive

payment solution allowing users to better manage their

energy consumption and optimize their budget

allocation.

Prepayment metering is simple and user friendly. Prepayment or ‘pay as you go’ has been

accepted by the utilities worldwide as a way to improve customer service, cash flow and the

revenue cycle. It is altogether a new arena in India and is likely to be important for revenue and

xciv

Figure 110: Prepaid Meter

Figure 111: Running Cycle of Prepaid Meter

energy management. This will benefit the State Electricity Boards (SEBs), private utilities and

the electricity consumers.


There are more than twenty five companies manufacturing approximately 20 million energy

meters per year in India.

Table 132: Genus Power Infrastructures Ltd


Nature of Business

Manufacturing Turnkey Services Automation R&D

Products/Services

Various Kind of Meter Manufacturing EPC in T&D Manufacturing of Meter Testing Equipments Inverters & Solar Product Manufacturing System Automation & SCADA Implementation Custom Built Software Billing Solutions

Leading Product/Service Meter Manufacturing System Automation

Infrastructure Mfg unit: 2 (Rajasthan, Uttarakhand)Annual Turnover(2010-2011 and 2009-10)


Technology Sourcing Indigenous Technology

Global Footprints USA, Germany, UK, Ireland, Canada, Bangladesh, Middle East, Africa,

Brazil, China, Singapore, Nepal

Indian Clientele

Various SEBs of States such as: KSEB, ASEB, RSEB, MSEB, MPSEB, UPPCL, UPCL, DHBVNL, JKPDD

Various Government Organization Such as: ITI, CDOT, Central Electronics Ltd., BSNL, DRDO, BEL

Other Players Such as: Reliance Energy, Ahmadabad Electricity Co., Surat Electricity Company, Tata Power, Torrent Power Ltd, Maruti Udyog Ltd, Instruments Ltd

CertificationISO 9001:1994, IECQ, DLMS Certification, IS, IDEMI, ERTLAwards from BHEL, NPCL etc.

Table 133: Secure Meters Limited


Turnkey Services

xcv

Automation R&D

Products/Services

Various Kind of Meter Manufacturing EPC in T&D Manufacturing of Meter Testing Equipments System Automation & SCADA Implementation Custom Built Software Billing Solutions

Leading Product/Service Meter Manufacturing System Automation Manufacturing of Meter Testing Equipments

Infrastructure Mfg unit: 3 (India) + 4 (UK & Sweden)Annual Turnover(2010-2011)

INR 599 Crore

Technology Sourcing In house R&DGlobal Footprints Presence in 50 countries across the world


Contractors, Cement Industry, Steel IndustryCertification NABL, IEC, ANSI, IEEE, ISO 9001, ISO 14001, OHSAS 18001

Table 134: L&T Limited (Electrical & Automation Division)

Presence in Market Since early 90s

Nature of Business Manufacturing Turnkey Services R&D

Products/Services

Various Kind of Meter Manufacturing System Automation & SCADA Implementation Energy Management Services Relay Manufacturing

Leading Product/Service Meter Manufacturing Relay Manufacturing

Infrastructure Mfg unit: 1 (Mysore)Technology Sourcing Indigenous Technology

Global Footprints

Mfg in UK: Collaboration with CyanTechnology; South East Asia, Middle East Countries, Africa Focus on European Markets

Indian Clientele Various SEBs across country Industrial Consumers Private Utilities

Certification NABL

Table 135: ECE Industries Limited

Year of Establishment 1945 (Metering Division Since 1962)

xcvi

Nature of Business Manufacturing Turnkey Projects

Products/Services

Energy Meter AMR Solutions Transformer Switchgear Elevator

Leading Product/Service Energy Meter Transformers

Infrastructure Mfg unit: 1 (Energy Meter at Hyderabad)Annual Turnover(2010-2011 and 2009-10)


Technology Sourcing Veb Electo Apparate-Werke, Germany


Certification ISO 9001-2000, BIS,

Table 136: HPL Metering Pvt. Ltd


Products/Services

Energy Meter Relays Switchgears Lighting Luminaries Wires & Cables

Leading Product/Service Energy Meter Switchgears

Infrastructure

Mfg unit: 9 (Meters: 2) Marketing Offices: 69 Dealers: 1,200 Retailers: 15,000

Average Annual Turnover INR 1,000 Crore

Global Footprints Middle East and SAARC countries European Markets


Certification ISO 9001:2000, IEC,

Table 137: Capital Power Systems Ltd


xcvii


Products/Services Energy Meter Relays

Leading Product/Service Energy MeterInfrastructure Mfg unit: 1Annual Turnover (2009-10) INR 72.5 Crore

Indian Clientele

Various Govt. Utilities such as: DHBVN, JSEB, Orissa utilities, CSEB, WBSEDCL, UP utilities, KSEB, Maharashtra utilities, Jaipur utilities, AP utilities, Haryana utilities

Private companies such as: Lanco, Tata, KEC International, Yamuna Power & Infrastructure, NCC Ltd, IVRCL, Kalpataru, Maytas, RPG, Kirlosker, A2Z, Jyoti Structures Ltd, Shyama Power India Ltd

Certification ISO 9001:2000, IEC, IS


100% metering of power supply connections insisted by many state regulatory commissions and

support by Ministry of Power through various reform programs, particularly RGGVY and now

RAPDRP has provided impetus to demand for meters. Overall environment for metering

industry in 09-10 has been generally good. Though physical sales did pick up as compared to

2008-09, prices have continued to fall. During the 2011-2012, growth rate of energy meters has

remained 6.1% which is 60% lower as compared to FY 2010-2011 that saw a growth of 15.4%.

Table 138: Performance of Metering Industry



YoY % Change

2010-11 2008-09 2009-10 2010-11 2011-12Energy Meters 3.7 2,250 -8.2 11.3 15.4 6.1Source: IEEMA

This can be attributed to sharp decline in financial health of most of distribution utilities during

the FY 2011-2012.

xcviii

Figure 112: Export of Electrical Meters

During the Year 2009-10 sales of

energy meters increased by over

11.3% mainly due to 38% growth in

Single phase static meters. Share of

Electromagnetic meters has further

reduced to 4.5%. CEA guidelines,

which have mandated use of static

meters, have seen the Indian energy

meter market shift largely to static meters. Market share of conventional electromagnetic meters

is on decline and is less than the 5% in 2010-2011.


The demand for meters, both for Single Phase and Three Phase, is expected to remain good for

next 2-3 years. Utilities are also procuring Indian companion standard compliant meters for

feeders, transformers and HT Consumers. This will lead to good demand for system meters.

Reasonable flow of enquiries with short delivery schedules have been observed from various

SEBs. Procurement of meters for RGGVY is being done by project contractors. An overall sale

of meter industry is expected to remain at current level. The basic underlying problems being

faced by the industry remain same, some of them are actually found to be on the rise.

Varying tender specifications, decreasing prices, practically little attention to quality in the

procurement procedures, etc. continue to bother manufacturers. Huge numbers of meters are

being procured for BPL consumers under RGGVY program through contractors, where both

quality and price have received severe beating. Lack of proper metering at every required point

has been the critical issue with the whole power sector (especially with distribution sector) in

India. But now efforts are being made to put the power sector on track of commercial principle.

It can be achieved only when a utility ensures 100% metering status.

xcix

2006-07 2007-08 2008-09 2009-10 2010-110

50

100

150

200

250

300

51

71 71

165

256

INR

Cro

re



Metering industry has witnessed consistent growth in all aspects such as market size, volume and

quality etc. This trend is likely to continue in the future even at a higher pace. Indian meter

manufacturing industry may gain momentum because of power sector reforms, reduction of

T&D and commercial losses etc. In the 11th Plan this industry has grown at an aggressive CAGR

of 5.8%. By the end of 12th Plan, CEA has envisaged this market size of INR 5,500 Crore. While

looking at the past trend, this industry is expected to grow up to the size of INR 3,158 Crore.

c

Growth Drivers 12th Five Year PlanRGGVY and R-APDRP Projects5 Crore new connections to be addedInvestment in Smart Grid: INR 9,500 CroreInstallation of 850,000 new DTs which require metering also

Market CompetitorsGenus Power Infrastructures LtdSecure Meters LtdL&T LimitedCapital Meters LtdECE Industries LtdElster Metering Pvt. Ltd.Landis Gyr LtdHPL Metering Pvt. LtdMahashakti Energy LtdAutomatic Electric LtdPower ProtectionBentec Electricals & Electronics Ltd Prospective Clients

Central & State transmission utilitiesGovt. & private discomsIndustrial Consumers

Current IssuesHigh diversity in utilities’ demandLack of standardization of software for different metersDiversity in meter class in different statesHigh performance indices and lack of meter testing facilitiesDurability of metersLack of focus on exports

Business RiskMore than 50% market share is held by top two playersPricing issue specially with Govt. clientsIndustry is highly dependent and driven by growth in power sectorLack of domestic testing facility at large scale

Figure 113: Metering Industry: Past Performance and Expected Market Size

CHAPTER – 5

CHALLENGES AND ISSUES

5.1 Increasing Imports: A Major Challenge

Imports of electrical equipment have grown in the past five years at a CAGR of 28.28%. Current

export-import trends based on select major ports trade data indicates alarming growth of almost

20% in imports; especially from China, South Korea, Germany and other EU countries. The

unfavorable domestic economic situation due to depreciation in Indian Rupee, high inflation,

high interest costs, credit squeeze etc. is having a significant adverse effect on the bottom line of

the industry; apart from intense overseas competition. This situation is getting exacerbated by the

turmoil in the global economy.

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2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-170

500

1,000

1,500

2,000

2,500

3,000

3,500

1,9

08

1,7

52

1,9

50 2,2

50

2,3

27

2,5

25

2,6

27

2,8

24

2,9

86

3,1

58

INR

Cro

re

CAGR: 5.8%

Figure 114: CHINA: Import Trend of Electrical Equipments

Prices of key inputs / raw material, especially which are imported in large quantities, are on an

upward trend. Stiff competition in the domestic market from foreign suppliers and also in global

markets is eroding the price competitiveness of Indian manufacturers. The price difference

between domestic companies vis-à-vis Chinese manufacturers is mainly due to disadvantages

faced by domestic manufacturers (State and local levies, higher financing costs, lack of quality

infrastructure, dependence on foreign sources for critical inputs / raw material, etc.), as well as

subsidies / incentives provided to the Chinese manufacturers by their government. It is widely

known that Chinese imports are relatively cheaper because equipment makers from China benefit

from low interest rates and an undervalued currency, which in itself leads to cheaper exports.

India now has adequate domestic capacity to fulfill the anticipated annual demand for power

generation capacity augmentation, which was not the case earlier.

A most recent positive step taken by Indian Government is the approval of long-delayed proposal

to levy 21% import duty on sourcing power equipment from overseas. This move will benefit

domestic equipment manufacturers in the country. In the July 2012, Indian Govt. has approved

5% basic customs duty, 12% Counter Veiling Duty (Excise Duty) and 4% Special Additional

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2002-032003-04

2004-052005-06

2006-072007-08

2008-092009-10

2010-11

2011-12(Apr-Dec)

0

10,000

20,000

30,000

40,000

50,000

60,000

2,4744,749 5,616

8,2485,238 3,792

7,280 6,0128,729

6,3577,366

13,00015,765

20,206 21,74724,308

39,658 40,551

47,71244,908

Electrical Equipments Total Imports

CAGR: 17%

2002-032003-04

2004-052005-06

2006-072007-08

2008-092009-10

2010-11

2011-12(Apr-Dec)

0

50,000

100,000

150,000

200,000

250,000

3,388 5,434 7,987 12,28119,191

30,70045,530 45,912

53,968 49,474

13,512 18,62531,892

48,117

79,009

109,116

147,606 146,049

198,079212,080

Electrical Equipments Total Imports

CAGR: 41%



Figure 115: KOREA: Import Trend of Electrical Equipments

Duty (SAD), totaling 21%. Earlier, the government had imposed of 5% customs duty on import

of power equipment for projects of less than 1,000 megawatt (MW) capacity, while projects with

more than that capacity did not attract import levy.

5.2 Critical Issues

The T&D sector today faces several major challenges. Some of them are as under.

Inadequate Availability of Critical Inputs (Raw Material)

Looming Skill Gap, Manpower Issues

Lack of Standardization

Inadequate Domestic Testing and Calibrating Infrastructure

Frame Model Procurement Guidelines/Practices for Utilities

Promotion of Innovation and R&D in the Industry

Right of Way, Forest Clearances and Land Acquisition Issues

Price Variation Issues

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CHAPTER – 6

CONCLUSION AND RECOMMENDATIONS

6.1 Business Opportunities

After the comprehensive analysis of the present market scenario, market players, growth drivers

of the sector, imports & exports, future investment etc. following market has been explored as a

business opportunity for a new entrant in the market.

Name of the Equipment Business OpportunityCable OutstandingConductor LowTransmission Tower MediumSwitchgear & Control HighTransformer Medium to HighEnergy Meter Outstanding

6.2 Cable

Cable manufacturing in India is the business full of opportunity. Although this segment has

witnessed the highest growth in the market size, yet India needs more cable manufacturing

capacity in EHV segment. Since EHV cable manufacturing is highly technology oriented process

therefore number of existing players in this segment is relative low. For entering in to this field

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now Indian manufacturers are doing partnership with some technologically mature player

irrespective of Indian or foreign origin. Future of this industry can be rated as ‘Outstanding’.

CableMarket Size (2011-12) INR 19,496 CroreManufacturing Capacity Utilization (2010-11) 47% (Power Cables Only)CAGR (11th FYP) 14.5%Optimistic Market Size (2016-17) (Y) INR 37,000 CroreMost Likely Market Size (2016-17) (X) INR 38,394 CroreRelative Achievement (X/Y) 104%Business Opportunity Outstanding

6.3 Conductor

Conductor manufacturing capacity in India is sufficient and it is not being considered as a very

attractive field from manufacturer point of view. It can be attributed to plans and process to

adopt HVDS and ABC technology by distribution utilities in the various states. Overall business

opportunity in this segment is ‘Low’.

ConductorMarket Size (2011-12) INR 5,914 CroreManufacturing Capacity Utilization (2010-11) 68%CAGR (11th FYP) 5.9%Optimistic Market Size (2016-17) (Y) INR 15,462 CroreMost Likely Market Size (2016-17) (X) INR 7,875 CroreRelative Achievement (X/Y) 51%Business Opportunity Low

6.4 Transmission Tower

Tower manufacturing in India is in good state and performing satisfactorily apart from lack of

EHV and UHV tower testing facilities with some players. Domestic manufacturers have

sufficient capacity and they are increasing their capacity on the right pace. It is EPC and Turnkey

Solution Provider route which can let a new player enter in to the market easily. It is because of

now most of the companies are shifting from manufacturing to additional construction activities.

Future of this industry can be rated as ‘Medium’.

Transmission Tower

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Market Size (2011-12) INR 6,257 CroreManufacturing Capacity Utilization (2010-11) 67%CAGR (11th FYP) 6.4%Optimistic Market Size (2016-17) (Y) INR 1,8038 CroreMost Likely Market Size (2016-17) (X) INR 8,545 CroreRelative Achievement (X/Y) 47%Business Opportunity Medium

6.5 Switchgear & Control

Switchgear manufacturing in India is dominated by a few big players followed by medium and

small players. Since this industry is highly technology oriented therefore number of capable

players in this segment is relative low. This segment may be one of the most rewarding for a new

entrant because of lack of domestic players in EHV and UHV category. Technological

partnership with some technologically mature player may be the entry strategy for a new player.

Therefore future of this industry can be rated as ‘High’.

Switchgear & ControlMarket Size (2011-12) INR 8,882 CroreManufacturing Capacity Utilization (2010-11) 66% (HT Switchgears Only)CAG (11th FYP) 7.9%Optimistic Market Size (2016-17) (Y) INR 22,000 CroreMost Likely Market Size (2016-17) (X) INR 12,977 CroreRelative Achievement (X/Y) 59%Business Opportunity High

6.6 Transformer

Transformer manufacturing can be divided in to two segments. One is Distribution transformers

and another is Power transformers. Indian market is performing well with respect to both

segments. Some major bottlenecks such as limited domestic EHV and UHV transformer testing

facilities and in house sourcing of key raw material are hindering the sector growth. In spite of

these challenges transformer industry is able to cope up with the foreign players. Future of this

industry can be rated as ‘Medium to High’.

TransformerMarket Size (2011-12) INR 12,498 CroreManufacturing Capacity Utilization (2010-11) 75%

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CAGR (11th FYP) 5.5%Optimistic Market Size (2016-17) (Y) INR 29,500 CroreMost Likely Market Size (2016-17) (X) INR 16,323 CroreRelative Achievement (X/Y) 55%Business Opportunity Medium to High

6.7 Energy Meter

Manufacturing of Energy Meters in India can promise any manufacturer for a long lasting and

consistent growth. This business is likely to follow one of the highest growth rates at least for

next ten to fifteen years. Modern technology and state of the art manufacturing facility is the key

to success in this business. Lack of adequate Meter testing facility is one of the major bottlenecks

of this industry. Now it has become technology oriented process therefore number of leading

players in this segment is very low. For the initial stage, technological partnership with a

domestic or international mature player can be the entry strategy.

Energy MeterMarket Size (2011-12) INR 2,387 Crore11th FYP CAGR 5.8%Optimistic Market Size (2016-17) (Y) INR 5,500 CroreMost Likely Market Size (2016-17) (X) INR 3,158 CroreRelative Achievement (X/Y) 57%Business Opportunity Outstanding

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BIBLIOGRAPHY AND REFERENCE

[1] Ministry of Power, GoI, “Report of the Working Group on Power for 12th Plan: January

2012”

[2] Ministry of Power, R-APDRP, RGGVY

[3] Planning Commission, Shunglu Committee Report, “Report of High Level Panel on

Financial Position of Distribution Utilities” December 2011

[4] Power Finance Corporation

[5] Central Electricity Authority, “Draft, National Electricity Plan (Volume I and Volume II)”

[6] Central Electricity Authority, “Annual and Monthly Summary Report” of Transmission &

Distribution Work

[7] Department of Industrial Policy and Promotion, “Indian Electrical Equipment Industry

Mission Plan: 2012-2022, Base Document”

[8] Central Electricity Regulatory Commission

[9] Ministry of Commerce, GoI

[10] Indian Electrical & Electronics Manufacturer Association (IEEMA)

[11] Powerline Magazine, June 2012

[12] Electrical Monitor Magazine’s Website

[13] Websites and Annual Reports (of last two to three years) of following companies

1. Bharat Heavy Electricals Limited2. Power Grid Corporation of India3. ALSTOM (AREVA) T&D India Ltd.4. Crompton Greaves Limited5. SIEMENS India Limited6. ABB Limited7. Transformers & Rectifiers8. Vijay Electricals Limited9. EMCO10. Voltamp11. Bharat Bijlee Limited12. Sterlite Technologies Limited13. JSK Industries Pvt. Limited14. Diamond Power Infrastructure Limited15. Deepak Cables (India) Limited16. KEC International17. Kalpataru Power Transmission Limited18. IVRCL19. Jyoti Structures Limited

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20. Gammon India Ltd21. Unitech Power Transmission Ltd22. Aster Private Ltd23. Man Structurals Pvt. Ltd24. Biecco Lawrie Limited25. Jyoti Limited26. Vishal Transformers & Switchgears (P) Ltd27. Heptacare Power Industries Pvt. Limited28. Hivoltrans Electricals Pvt. Ltd29. SCT Limited30. Macroplast Pvt. Ltd31. Kappa Electricals32. Genus Power Infrastructures Ltd33. Secure Meters Limited34. L&T Limited (Electrical & Automation Division)35. ECE Industries Limited36. HPL Metering Pvt. Ltd37. Capital Power Systems Ltd

For Annexure I and Annexure II

Following assumption and steps have been adopted while finding out the future market size as

per tables displayed below.

[1] This data sheet includes major T&D equipments as per mentioned by IEEMA. IEEMA

consists 95% Indian Electrical Equipment Manufacturers.

[2] Actual market size for 2010-11 was available. Apart from it YoY % growth rate was

available. Accordingly, markat size for 2008-09, 2009-10 and 2011-12 has been calculated.

[3] On the basis of available market size of last five consecutive years, CAGR has been

calculated.

[4] Assumption for market size forecasting: Conservative approach has been adopted with

consideration that Market will grow at the same CAGR of last five years.

[5] Prospective market has been calculated with the help of found CAGR.

[6] Assessed Market in 2017 and 2022 by CEA has been taken from "Indian Electrical

Equipment Industry Mission Plan 2012-2022: Base Document" from "Ministry of Heavy

Industries and Public Enterprises"

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ANNEXURE– I (Following raw data sourced from IEEMA, CEA & thereafter calculated)

Performance of Major T&D Equipments Industry: 2007-08 to 2011-12

Weight (%)

2007-08 2008-09 2009-10 2010-11 2011-12

Market Size

Market Size

YoY Growth (%)

Market Size

YoY Growth (%)

Market Size

YoY Growth (%)

Market Size

YoY Growth (%)

Rotating Machines 10.5 5144 4964 -3.5% 5624 13.3% 6310 12.2% 6373 1.0%

LT Motors 5.1 2305 2155 -6.5% 2644 22.7% 2985 12.9% 3021 1.2%HT Motors 2.1 996 1126 13.1% 1242 10.3% 1225 -1.4% 1492 21.8%

Alternators 1.9 888 914 2.9% 924 1.1% 1115 20.7% 918 -17.7%

FHP Motors 1.4 733 642 -12.3% 665 3.5% 780 17.3% 734 -5.9%

Switchgear 15.1 6557 6557 0.0% 7508 14.5% 9100 21.2% 8882 -2.4%Power Contactors 2.6 670 551 -

17.8% 777 41.0% 1000 28.7% 896 -10.4%

LT Circuit Breakers 3.6 888 880 -1.0% 1138 29.4% 1360 19.5% 1281 -5.8%

MCBs 2.8 723 793 9.7% 975 23.0% 1050 7.7% 1213 15.5%S/F and F/S Units 0.5 213 189 -

11.1% 199 5.3% 207 3.8% 198 -4.3%

HT Circuit Breakers 5.6 1728 1769 2.4% 1667 -5.8% 2140 28.4% 2016 -5.8%

Cables 25.8 11337 11836 4.4% 13268 12.1% 15510 16.9% 19496 25.7%PVC Power Cables 17.9 6807 7780 14.3% 8908 14.5% 9710 9.0% 11400 17.4%

Control & Special Purpose Cables

7.9 4260 3127 -26.6% 3202 2.4% 4300 34.3% 6214 44.5%

Transformers 20.6 10095 9973 -1.2% 10881 9.1% 12350 13.5% 12498 1.2%

Power Transformers 8.6 3086 3882 25.8% 4549 17.2% 5150 13.2% 5531 7.4%

Distribution Transformers 12 7392 6143 -

16.9% 6327 3.0% 7200 13.8% 6962 -3.3%

Capacitors 0.9 336 345 2.6% 382 10.7% 515 34.9% 506 -1.8%HT Capacitors 0.3 120 128 6.7% 169 32.2% 200 18.2% 183 -8.3%

LT Capacitors 0.6 220 222 1.0% 217 -2.2% 315 44.9% 319 1.4%

Energy Meters 3.7 1908 1752 -8.2% 1950 11.3% 2250 15.4% 2387 6.1%

Transmission Lines 23.4 10915 12389 13.5% 13529 9.2% 14070 4.0% 13957 -0.8%

Transmission Line Towers 12.6 4876 5193 6.5% 6180 19.0% 6600 6.8% 6257 -5.2%

Conductors 10.8 4703 5704 21.3% 5716 0.2% 5670 -0.8% 5914 4.3%

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Total 100 46247 47496 2.7% 52863 11.3% 60105 13.7% 64072 6.6%

ANNEXURE– II (Following raw data sourced from IEEMA, CEA & thereafter calculated)

CAGR 08-09 to 11-12

Prospective Market Size Market Size in 2017

(Assessed by

CEA) (Y)

Relative Achievemen

t (Y/X)

2012-13 2013-14

2014-15

2015-16

2016-17

Market Size Market Size

Market Size

Market Size

Market Size (X)

Rotating Machines 5.5% 6724 7094 7484 7896 8331 15000 56%

LT Motors 7.0% 3232 3459 3701 3960 4237 HT Motors 10.6% 1651 1826 2020 2235 2473 Alternators 0.8% 925 933 941 948 956 FHP Motors 0.0% 734 735 735 735 736 Switchgear 7.9% 9581 10336 11151 12030 12977 22000 59%

Power Contactors 7.5% 963 1036 1114 1198 1288

LT Circuit Breakers 9.6% 1404 1538 1686 1847 2025

MCBs 13.8% 1380 1571 1788 2036 2317

S/F and F/S Units -1.8% 195 191 188 184 181

HT Circuit Breakers 3.9% 2095 2177 2263 2352 2444

Cables 14.5% 22326 25567 29278 33528 38394 37000 104%

PVC Power Cables 13.8% 12968 14752 16782 19091 21718

Control & Special Purpose Cables 9.9% 6828 7504 8247 9063 9960

Transformers 5.5% 13184 13907 14670 15474 16323 29500 55%

Power Transformers 15.7% 6400 7405 8569 9914 11472

Distribution Transformers -1.5% 6859 6757 6657 6558 6461

Capacitors 10.8% 560 620 687 761 843 1000 84%HT Capacitors 11.2% 204 227 252 280 312 LT Capacitors 9.8% 351 385 422 464 509 Energy Meters 5.8% 2525 2670 2824 2986 3158 5500 57%

Transmission Lines 6.3% 14842 15783 16783 17847 18978 33500 57%

Transmission Line Towers 6.4% 6659 7087 7543 8028 8545 18038 47%

Conductors 5.9% 6263 6632 7023 7437 7875 15462 51%Total 8.5% 69513 75415 81819 88767 96305 177000 54%

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prospects of t & d equipment manufacturing in india

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