6. Working of the power industries
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7. As per CEA total
installed capacity is
Public sector share is
State sector 48%
Central sector 31%
Rest 21% is of private
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8. I. Demand-Supply Gap.
II. Government policies.
III. Transmission and
IV. FDI Equity Flows in
V. Private participation in
Symbiosis Institute Of Operations Management 8
9. ISSUES AND CHALLENGES
Availability of Coal.
Dependence on Equipment Suppliers.
Aggregate Commercial and Technical Losses.
Other Roadblocks leading to Demand Supply Gap.
• Lack of skilled labor.
• Political factor.
10. Regulatory bodies
• The Ministry of Power is primarily responsible for the
development of the Indian power sector.
It is concerned with perspective planning and policy
formulation in the sector.
• The State Electricity Boards (SEBs).
It generate, transmit and distribute electricity in
coordination with private/centrally owned generating
companies or any other relevant agency.
12. Regulatory bodies (cont..)
• Central Electricity Regulatory Commission (CERC)
It has been set up for rationalization of bulk and
retail tariff for generation and transmission
utilities involved in interstate operations.
It also regulates at intra-state level. Each state
has set up a State Electricity Regulatory
Symbiosis Institute Of Operations Management 12
13. Government policies
• The Electricity Act 2003
Key feature of this act
I. Removal of a number of restrictive barriers to the flow
of power in a competitive market scenario by opening
access to transmission (from the outset) and
II. Freeing up of generation and captive power plants
from licenses and techno economic approvals.
III. Transferring the full range of regulatory and licensing
functions to the Central and State Regulatory
IV. Deregulating tariffs in certain situations e.g. in case of
agreements between consumers and generating
Symbiosis Institute Of Operations Management 13
14. Guidelines for procurement of
In compliance with section 63 of the Electricity Act, 2003, the Central
Government had notified guidelines for procurement of power by
Distribution Licensees through competitive bidding.
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15. Tariff Policy
The Tariff Policy has been notified by Government of India on6
January, 2006 under the provisions of section 3 of the Electricity
Ensure availability of electricity to consumers at
reasonable and Competitive rates.
Ensure financial viability of the sector and attract
Promote transparency, consistency and
predictability in regulatory approaches across
jurisdictions and minimize perceptions of
Promote competition, efficiency in operations
and improvement in quality of supply.Symbiosis Institute Of Operations Management 15
16. Some other policies
• Rural Electrification Policy
Rural Electrification Policy, in compliance with section 4
and 5 of the Electricity Act 2003, was notified on 23
• Section 63 of the Electricity Act New Hydro-Policy.
• Hydro policies.
• Non-conventional Energy Generation.
• The Accelerated Power Development and Reform
Programme (APDRP) programme is being implemented
so that the desired level of 15 per cent AT&C (Aggregate
Technical and Commercial) loss can be achieved
(Currently it is 30%).
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17. Future/Undergoing projects
• The Government of India is planning nine Ultra Mega
Power Projects (UMPP) of 4 GW each with an estimated
individual investment of US$ 4 billion (Rs. 192 billion).
Four of these projects are expected to be commissioned
between 2011 and 2017. The UMPP is an initiative by
the government to collaborate with power generation
companies to set up 4,000 MW projects to ease the
country’s power deficit situation.
• Private investment has been allowed in power
transmission either through 100per cent equity or joint
venture with PGCIL. In case of latter, the PGCIL will hold
only 26per cent stake and private party would hold the
• 18 State Electricity Regulatory Commissions have
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