RENEWCONNECT - All about renewables & power sector

Credit ratings for Indian distribution companies (DISCOMs) are based on multiple factors assessing financial health, operational efficiency, and overall management of power distribution. Here’s an overview of how these ratings are typically assigned: Financial Performance : Agencies like ICRA, CRISIL, and CARE assess financial metrics such as profitability, debt levels, cash flow, and cost structure. Specific indicators include revenue collection efficiency, cost coverage ratio (ability to cover operational costs through revenue), and levels of state government subsidies received. The ability to manage debt and avoid defaults heavily influences the rating. Operational Efficiency : This encompasses metrics such as Aggregate Technical and Commercial (AT&C) losses, which measure energy lost in distribution and unbilled consumption. High AT&C losses often reflect operational inefficiencies and theft, impacting a DISCOM’s profitability and reliability. Agencies also review supply qu...

The Ujwal DISCOM Assurance Yojana (UDAY) was launched in November 2015 by the Indian government to improve the financial and operational health of power distribution companies (DISCOMs). DISCOMs in India have historically struggled with high levels of debt, operational inefficiencies, and technical losses, impacting their ability to provide consistent and affordable electricity to consumers. UDAY sought to address these challenges through a series of structural and financial reforms. Key Components of the UDAY Scheme: Debt Restructuring : A major component of UDAY was the restructuring of DISCOM debt. Under the scheme, state governments took over 75% of the debt held by their DISCOMs and issued bonds to cover it. This move reduced the interest burden on DISCOMs, allowing them to focus more on operational improvements. Operational Efficiency Improvements : Reduction in AT&C Losses : Aggregate Technical and Commercial (AT&C) losses, which result from theft, unbilled consumption, ...

 Renewable Purchase Obligation (RPO) requirements in India mandate that electricity entities (such as DISCOMs, open access consumers, and captive power producers) procure a certain percentage of their energy from renewable sources. RPO requirements are specific to different segments within the electricity supply chain—generation, transmission, and distribution. Here’s how these obligations typically apply across these segments: 1. Generation Segment : Renewable Energy Generation Targets : The generation segment is indirectly impacted by RPOs because they create a demand for renewable energy. This obligation requires generation companies to either directly produce or facilitate the production of renewable energy to meet the RPO demand from DISCOMs and other obligated entities. Solar and Non-Solar RPO : Power producers who operate coal-fired or non-renewable power plants often partner with renewable energy producers or set up their own renewable installations to meet RPO compliance. ...

The history of electricity distribution schemes in India by Distribution Companies (DISCOMs) reflects the evolution of the power sector to address the country's growing energy demands and ensure reliable supply. Here is an overview of DISCOM schemes, starting from earlier reforms to current programs: 1. Early Reforms (Pre-2000) Electricity distribution in India was initially handled by state electricity boards (SEBs). These boards were vertically integrated, managing generation, transmission, and distribution. However, inefficiencies like losses, theft, and inadequate infrastructure led to poor performance. Electricity (Supply) Act, 1948 : Formation of SEBs for integrated management. Challenges : High Aggregate Technical and Commercial (AT&C) losses and poor service delivery. 2. Unbundling and Restructuring (Post-2000) The focus shifted to unbundling SEBs into generation, transmission, and distribution entities. This era saw the rise of independent DISCOMs. Electricity Act, 200...

Scope of Implementation in India: Grid Integration with Renewables : India’s power sector is rapidly moving toward renewable energy sources, particularly solar and wind. Energy Storage Systems (ESS) are essential to manage intermittency and stabilize the grid. DISCOMs (Distribution Companies) are crucial for integrating ESS to ensure consistent power supply, especially during peak and off-peak hours. Demand Management : With increasing electricity demand, DISCOMs in India face challenges in ensuring reliable supply. ESS can be deployed for demand response programs, load shifting, and peak shaving to reduce stress on the grid during high demand periods. Frequency Regulation : ESS plays a significant role in maintaining grid frequency within permissible limits. In India, where frequency fluctuations are common, deploying storage systems can help maintain grid stability and avoid penalties for DISCOMs. Decentralized Power Generation : India is focusing on decentralized generation and micr...

India, often referred to as an agrarian economy, relies heavily on agriculture as a primary source of livelihood for a significant portion of its population. As a result, agriculture plays a pivotal role not just in food security but also in the consumption of energy, specifically power. Agriculture’s dependence on electricity is evident in its usage for irrigation, mechanized farming equipment, and storage, contributing significantly to the overall energy demand in the country. With India progressing towards becoming a developed nation, investments in the agricultural sector have risen consistently over the years. The government has made substantial strides in electrifying rural areas and providing affordable power for farmers, but this has also led to some challenges in managing energy demand and the financial sustainability of power utilities. This article examines the maximum agricultural power-consuming states in India, the challenges associated with agricultural power consumption...