By Mr. B A Chaudhari, Chief Operating Officer
Published in "The Financial Express", Wednesday, August 11, 2010

By Mr. B A Chaudhari, Chief Operating Officer
Published in "The Financial Express", Tuesday, June 16, 2009

The enactment of the Electricity Act, 2003, brought out several enabling provisions. Installation of dedicated transmission lines by generating companies or captive generating plants (CPP) is one of them. This provision has enabled generating companies and CPPs to establish connectivity with sub-stations or load centres by laying dedicated transmission lines.

Power being a concurrent subject; both states as well as the Centre have a role in framing policies and its implementation. Traditionally, the transmission of electricity within the state is under the purview of the state-owned companies, which were subsequently notified as state transmission utilities (STU) for intra-state transmission system. A central transmission utility (CTU) was for inter-state transmission system. While the central government has taken various initiatives towards strengthening the inter-state transmission system through private sector participation, some states that own a large chunk of transmission systems are lagging behind. The development of transmission systems has to be accomplished in a coordinated manner and in sync with capacity addition in power generation.

Although the Act provides for generating companies to set up small dedicated transmission lines to establish connectivity between the generating station and the nearest grid point for further evacuation of power using intra/inter-state grid, the IPPs are resorting to set up large transmission lines for dedicated use. Perhaps, due to lack of initiative on the part of STU/CTU, the generating companies are compelled to set up a large transmission lines for dedicated use. Recently, one of the upcoming Independent Power Producer (IPP) in Gujarat succeeded in winning the bid to supply power to one of the states in the north. It is understood that IPP is laying a dedicated line between the generating plant and the grid sub-station of the concerned state. On one hand, India is heading for ‘one nation, one grid’ concept and on the other, inter-region dedicated transmission systems are being conceived just because the Act allows for such dedicated lines.

In an integrated grid, power is supplied on displacement basis by using the transmission system in the most optimal manner. Would it, therefore, be advisable to allow such dedicated power corridors to be built, which span over thousands of kilometres? The Act also provides for open access to power transfer and so it remains to be seen whether dedicated transmission lines of such high capacity would provide a cost-effective solution.

Moreover, due to scarcity of land, the need of the hour is to strengthen/ lay regional transmission system that would cater to large number of users, thereby, lowering the tariff to the end-user. Also, expecting cooperation from non-beneficiary states for installation of dedicated transmission lines through their land would be a far cry. In light of the above, it is necessary for all the stakeholders to review the concept of dedicated transmission lines and help develop and operate the transmission system in a cost-effective and efficient manner.

The writer is COO, Powerlinks Transmission Ltd. These are his personal views

By Mr. B A Chaudhari, Chief Operating Officer
Published in "The Financial Express", Tuesday, April 21, 2009

POWER Grid Corporation of India Ltd. is the only major transmission company in the country to own an inter-state transmission system. It has a network of around 67,000 circuit km of extra high-voltage lines with 116 sub-stations and a power transformation capacity of more than 73,000 mva. Currently, the transmission network handles inter-regional power transfer of about 19,800 mw.

During the 11th Plan, Power Grid is targeting to double its network by adding around 60,000 circuit km of transmission lines. This would mean an investment of over Rs 55,000 crore by 2012. This network will support additional generation capacity of 78,000 mw during the Plan period and double the inter-regional transmission capacity to 37,700 mw.

The efforts of Power Grid to create a robust transmission network would need to be supplemented by the private sector. The government took the initiative to facilitate private sector participation in transmission by bringing about certain enabling changes in the legal framework.

Thereafter, Power Grid, which was notified as a central transmission utility, spearheaded implementation of a few projects through the PPP model, either through the joint venture route or independent private transmission company route.

The Tala transmission project, implemented by Powerlinks Transmission Ltd, is the first project through PPP and has been successfully operating since September 2006. Subsequent transmission projects for evacuation of power from Parbati-II and Koldam hydroelectric projects commenced construction after some initial hiccups. However, Power Grid ultimately implemented the Bina-Nagda-Dehgam transmission project — which was to be implemented through the private transmission company route — for lack of investor enthusiasm. Thus, private participation in transmission has taken a step back despite the good initial start.

The Electricity Act, 2003, opened the doors for private sector participation through tariff-based competitive bidding and provided for appropriate regulatory commissions to encourage competition, efficiency, economical use of resources, good performance and optimum investments. But even with the enabling policy framework in place, private investment in the sector in general, and transmission in particular, has been far below expectations.

Further, under the direction of the Central Electricity Regulatory Commission (CERC), Power Grid initiated the bidding process for the western region-strengthening scheme through the private transmission company route in 2005. The award of the project to the lowest bidder was delayed for various reasons, prominent being obtaining approval from the PPP appraisal committee and a change in the bidding conditions with respect to the buyout obligation. The project was further put off due to a delay in the signing of agreements between the private transmission company and beneficiaries. Recently, CERC awarded the necessary transmission licence and granted an extension for completion.

Around two years ago, the empowered committee identified 12 transmission projects for implementation by the private sector. Due to delays in initiating the bidding process, some of them were handed over to Power Grid so as to ensure development of the transmission system ahead of the generating stations. While experimentation is good, the adoption and continuation of a successful model is essential. There is every reason for optimism about the tariff that emerged through competitive bidding; however, one also needs to cautiously monitor how many companies can deliver the projects on schedule.

Thus, it is clear that private sector participation in transmission is inevitable and it is essential to try out tested models such as PPP for more projects. This would help private companies gain confidence in implementation of transmission projects. Unlike generation projects, which are confined to four boundaries, transmission lines run cross-country and, therefore, face right of way-related challenges.

Though the Electricity Act provides for a licensee to exercise powers under the Indian Telegraph Act, 1885, if left to a private company, it would be difficult to circumvent obstructions from owners of private properties as well as the custodians of public property. PPPs would benefit from the participation of central or state transmission utilities to obtain the necessary right of way expeditiously for transmission lines.

Secondly, a lot of inter-phasing would be required between transmission lines and sub-stations, the latter largely owned, operated and maintained either by central or state transmission utilities.

Thirdly, the stability of the network would be of utmost importance and cutting corners for the sake of gaining competitive advantage might jeopardise the safety and security of the transmission system.

Fourthly, the regulatory mechanism in India has matured enough to ensure that projects are completed at optimum cost and on schedule. Moreover fairly reliable benchmark costs are available today for comparison.

Lastly, central and state transmission utilities being stakeholders in PPPs would certainly guide the private company towards efficient and optimised operation. Existing PPPs, which have a proven track record, need to be considered for additional projects. The government may consider amending the existing framework to facilitate such initiatives.

The writer is COO, Powerlinks Transmission Ltd. These are his personal views

• 400 kV D/C Jaigarh - New Koyana Line (QUAD MOOSE)
• 400 kV D/C Jaigarh - Karad Line (QUAD MOOSE)

The above lines would facilitate evacuation of power from 1200 MW Thermal Power Project being set up at Jaigarh in Ratnagiri District of Maharashtra.

PwC has been retained by JSW Energy Limited for advising them on commercial issues.

Recently, the tendering process was completed for above lines and L & T has been issued letter of acceptance of their proposals for both the lines. Necessary Letter of Awards being issued. Meanwhile, all outstanding technical/ commercial issues were resolved with L & T, during the pre-award discussions held on 8th July 2008.

L & T has commenced mobilization w.e.f. 9th July 2008. The Company has also commenced mobilization and posted our Project Manager for establishing the site office at Chiplun. The foundation work has commenced on both the lines.

• Review of bidding documents (RFQ &amp: RFP) for procurement of equipment / EPC services by Haryana State Electricity Board

The Company has reviewed the Standard Bidding Documents (SBD) prepared by HVPNL and provided valuable comments/ suggestions to make the documents as comprehensive as possible.

The SBD is in the process of final approval from the World Bank.

The Journey that started sometimes in July 2000 with the selection process for the Joint Venture for execution of the prestigious Tala Transmission System has borne the fruits more that expected. POWERLINKS TRANSMISSION LIMITED takes the pride for having created the first ever Transmission System with Public and Private partnership, thereby paving the path for Private Investment in the Transmission Sector.

Powerlinks has not only executed the Project in time and within the Budget but has set the highest standards of Quality in the Transmission Projects and has become the 'Role Model' in this Sector. Today the entire team of Powerlinks is highly motivated and charged after the successful commissioning of the Tala Transmission Project and is ready to take up many more challenges and do even better job and set a benchmark for others to follow.