Over the past decade or so, the electrical equipment and power sector has seen sweeping changes resulting in a radical metamorphosis of the industry. Much of this has been possible due to a liberal policy environment that has encouraged sustainable participation of the private sector. In this prognostic study, Electrical Monitor briefly discusses some key milestones that the electrical equipment and power industry is expected to cross by the year 2020.

Tariff-based bidding: By 2020, one can look forward to a robust mechanism governing the extant tariff-based bidding process. Although the process is very much in vogue today, success stories have only been sporadic. There have already been instances where power developers are very apprehensive of selling power at the specified tariffs due to factors unforeseen at the time of bidding and now beyond their control. As we go along, we can expect that the policy framework addresses such anomalies swiftly without stalling the project progress. In conjunction, India would also need to bolster its machinery in according environmental clearances, coal linkages and other preproject clearances in a time-bound manner. Only this would result in more projects being readied for the awarding stage. Assuming that the government's machinery to facilitate projects is sufficiently galvanized, one can expect traction in the ultra mega power project (UMPP) series that is currently stumbling with only four projects awarded in the seven years of its launch. By 2020, the UMPP series can be an important means to augment power generation capacity with significant technocommercial efficiency and a relatively lower carbon footprint.

Supercritical Technology: Despite India's efforts to enhance power generation from non-fossil energy sources, its dependence on coal-fired plants to base load will persist. The approach therefore is to make coal-fired power generation more sustainable through use of efficiency measures like supercritical technology. India has already made a beginning with supercritical technology with a few power plants (by Adani Power and NTPC) already in their early days of operation. Currently, the technology is largely sourced from overseas with Chinese players dominating the proceedings.

By 2020, one can safely expect all upcoming coal-fired power plants to be based on supercritical power technology. The government has set out an official expectation that in the XIII Plan period (FY18 to FY22) all new coal-fired power plants will be based on supercritical technology. One can also assume that by 2020, India would have developed indigenous capability to manufacture supercritical power equipment. Currently, there are around six joint ventures between Indian companies and multinationals to set up local plants for producing supercritical boilers, and turbine-generators. By 2020, most of these should have fructified. One can also expect this to result in a decline in imported power generation equipment, mainly from China. On this point, one can also assume that the import duty structure will have been corrected to create a level-playing field between Indian and foreign equipment.

National Grid: Power Grid Corporation of India Ltd has embarked on an inter-regional transmission system to enable seamless transfer of power across the five regional grids of the country. The National Grid is seen as an important tool to ensure efficient load management between power-surplus and power-deficient regions. The National Grid, with a total capacity of 37,500 mw, was envisaged for full completion by March 2012 but is running behind schedule by around two years.

By 2020, the National Grid will of course be completed and one can also look forward to substantial increase in its handling capacity. As of March 2012, the total capacity of the National Grid stood at around 28,000 mw with additions in the XI Plan period (FY08 to FY12) alone being 13,900 mw.

The National Grid envisages synchronous transmission (at the same frequency) of power between the five regional grids—east, west, north, northeast and south. Currently, all grids except the southern grid are interconnected. The southern grid is connected, but asynchronously (at different frequency) with the rest of the grid. This has been achieved through HVDC links and radially-operated AC links.

It may also be noted that the National Grid is also important on two counts—one, deployment of advanced technology like 765kV infrastructure, and two, involvement of private sector as owners and developers of transmission lines.

Distribution transformers: The Indian transformer industry has two extremities. On the one hand, the country has demonstrated its abilities to indigenously produce power transformers of 1,200kV—the highest rating in the world. On the other, it has the highest failure rate—of over 25 per cent—with respect to distribution transformers. For 2020, a realistic expectation would be to see substantial mitigation in the anarchy prevailing in the distribution transformer industry.

Apart from the malady of inferior CRGO (that has been discussed separately), flawed procurement policies of state power utilities are a matter of grave concern. Currently, much of the government procurement is done through the L1 philosophy where the equipment is purchased from the suppliers quoting the lowest. It is this myopic practice that has spawned a breed of unscrupulous manufacturers. If by 2020, government procurement policies undergo a radical transformation—that is they look clearly beyond just L1— much of the house will fall in order.

Also, state government utilities should at least try to standardize their transformer specifications. This will enable domestic manufacturers to achieve economies of scale. Currently, transformer manufacture is a highly customized activity.

It is also expected that by 2020, the star-labeling programme of Bureau of Energy Efficiency is implemented strongly for distribution transformers. It is not reasonable to expect that all distribution transformers pressed into public service to have the highest efficiency rating.

Through stringently implemented policy measures, India, by 2020, should rid itself of unethical distribution transformer manufacturers. This can be done only by devising and enforcing an overarching policy framework that destroys the very demand for inferior distribution transformers.

CRGO: India has traditionally had a difficult time with electrical steel—specifically cold rolled grain oriented steel (CRGO) that is a critical input for transformers. Firstly, the country has consistently failed to set up domestic manufacturing capacity making reliance on imports inevitable. To compound matters, India has become a dumping ground for inferior CRGO that finds its way— sometimes willfully and sometimes inadvertently—into transformers. The government is in the process of mandating that foreign mills intending to supply CRGO to India must ensure that their products have the "BIS certification". This move is technically sound but will not be easy to implement. Some mills have registered under the scheme while others are in the process.

By 2020, one expects that the CRGO issue is resolved. There could be no better news for the Indian transformer industry that has the dubious distinct of having the highest distribution transformer failure rate in the world. The vision for 2020 would be the emergence of domestic manufacturing capacity and a sharp decline in the use of imported scrap CRGO.

Cable Technology: As carriers of electricity, cables are the quintessence of power T&D infrastructure. Cables could range from EHV cables are used in sub-transmission and distribution, up to building wires & cables that are used in providing last-mile connectivity to the wall socket. By 2020, one can expect key changes in the industry that could include a radical shift in the technology paradigm and the gradual easing out of marginal players in the building/home wiring segment.

India has a significant presence of unorganized sector players in the home wiring segment that includes cables of less than 1.1kV rating. These companies, thanks to the alleged use inferior copper and insulating material, can sell their products very cheap. Further, they cater only to the local market—usually tier-III cities and towns—thus keeping their distribution costs at the minimum. Players in the organized sector find it unviable to even compete with these local brands on the price front. It is estimated that 30 per cent of the low-tension cables consumed in India are from unorganized sector players. However, due to growing quality consciousness of consumers, the hold of marginal players is expected to loosen and their share is expected to fall to less than 10 per cent by 2020.

In terms of new technology, India is expected to make significant progress in the local manufacture of extra highvoltage (EHV) cables, those with a rating of 220kV. By 2020, India would have 8-10 domestic players—most of them with foreign technical collaborations—making EHV cables. Even as of now, at least two players have acquired competence in producing 400kV EHV cables.

In the coming years, EHV cables will begin to find deployment largely as a replacement to overhead power distribution lines. More and more utilities will be seen shifting to underground EHV cables. If India's success rate with privatization of power distribution is high, usage of underground EHV cables will be even more intense given the private sector's predisposition towards modern technology. As India's EHV cable consumption begins to grow, one can also anticipate competition by way of imports. China is expected to lead price-based competition as it has done to other segments of the electrical equipment industry.

High-voltage transmission: India's ongoing experiments in using 1,200kV ultra-high voltage for power transmission are being viewed keenly by the world. Last year, India achieved a rare technological distinction by successfully conducting the test run for 1,200kV power transmission on a 1-km line at Bina in Madhya Pradesh. So far, no other country has succeeded in transmitting power at 1,200kV. Countries like China and Russia are believed to have commercial power transmission lines of around 1,000kV.

The 1,200kV endeavour is a joint exercise between Central transmission utility Power Grid Corporation of India Ltd and leading equipment manufacturers like Siemens, ABB, Alstom, Vijai Electricals Ltd. The response of Indian manufacturers to produce 1,200kV equipment like transformers, reactors, circuit breakers, etc has been outstanding. It must be appreciated that producing equipment without known standards is a much more challenging job than replicating something that has essentially been produced somewhere in the world.

By 2020, one can look forward to India stabilizing the commercial viability of 1,200kV technology. Currently, the success with 1,200kV transmission has been setting up and testing the pilot project. Even the competence for producing equipment and accessories has been established, largely with respect to the pilot project. Commercial operations will be a different paradigm altogether. Experts feel that the way forward for India would be set up few commercial lines to begin with. These will not be charged at the highest voltage, at the very onset. Experts feel that the way to go forward would be to set up 1,200kV lines but charge them at 400kV initially, and move up gradually. Commercial deployment will be a gradual process but one can be sure that by 2020, India would have sufficient demonstrable signs of progress. Apart from 1,200kV, India, by 2020, will have achieved considerable stability in EHV power transmission like 765kV AC and 800kV DC.

If one looks at the geographical aspect of India's power generation and consumption, one can see that power generation centres (east and northeast) are very distinct from consumption zones (west, north and south India). India has no alternative but to use transmission lines that can transfer more electricity per unit geographical area. By 2020, India will show technical competence and sufficient commercial success in its high-voltage transmission infrastructure.

It is also expected that by 2020, Indian testing laboratories like CPRI, ERDA, etc will be equipped to test high-voltage equipment for which the country is currently banking on testing labs abroad.

Power Distribution: The power distribution sector is almost entirely responsible for the current dismal state of the Indian power sector. Years of decadence have snowballed into a financial catastrophe, which cannot be remedied in a hurry. For 2020, the only vision that one can have for the ailing power distribution segment is to initiate a serious multi-pronged solution strategy to bring about an honest improvement to the current morass. While one must admit that there has been a sincere attempt by the government in treating the wounds of the power distribution sector, the progress has been slow. There have been enough policies announcements, all aimed at "reforming" the sector, but the pace of implementation has fallen seriously short of expectations. Every area of power distribution—be it as rudimentary as village electrification or as futuristic as Smart Grid—has been touched upon by the government. This must be clearly acknowledged. However, the achievement record has belied expectations. For 2020, here is a wish list on various aspects of the power distribution segment.

• The much celebrated "Power for All" milestone was to be crossed by March 2012 and complete village electrification was the quintessence of this objective. India is now expected to achieve 100 per cent village electrification very shortly; the project is officially 97 per cent complete. By 2020, rural electrification is expected to intensify further. This means that villages that have been declared electrified technically will see more households getting electrified. (By latest definition, a village is declared electrified if, among other things, at least 10 per cent of the households have an electricity connection.) On the way to 2020, one can also expect 100 per cent electrification but with the threshold household electrification limit progressively being raised from the current 10 per cent.
  
• India's current aggregate technical and commercial (ATC) losses in the power sector are estimated at an alarming 25 per cent. It is an abjectly shameful metric for a developing country; even under-developed countries have significantly lower losses. Much of these losses are commercial in nature, resulting from poor revenue collections. This in turn is due to power theft, unaccounted electricity meters, under-recovery of dues from consumers, etc. The vision for 2020 should be lowering the ATC losses to more respectable levels—say around 10 per cent—as is the case with most developed countries. Lowering ATC losses could initiate a virtuous cycle where power utilities will become financially stronger. This is will result in more capital investment, only to mean better infrastructure and services for consumers.
  
  By 2020, it is hoped that utilities distribution are in better financial health for which Centrally-sponsored programmes like R-APDRP (Part A) should be pursued vigorously. This project involves setting up of IT-enabled infrastructure like GIS mapping of assets, consumer indexing, etc. This project too is lagging behind its targeted completion date of March 2012. As far as the vision for 2020 is concerned, it would be only fair to expect that every power distribution utility (hopefully most of them are privatized by then) should have complete knowledge of its assets, consumers and of every kwh of electricity consumed.
  
• When we speak of private sector participation in the power sector, one can only think of power generation. In the other two major departments—transmission and distribution—the progress has been wavering. Power generation—both conventional and renewable energy — has seen significant private and foreign sector investment. In fact, renewable energy is an activity designed to run entirely on private enterprise. Regarding power transmission, a beginning has been made but there has been no demonstrable progress. Power distribution is struggling with privatization. India has traditionally had some private power utilities like Tata Power, BSES (now RInfra), Ahmedabad Electricity (now taken over by Torrent), CESC, etc. However, the success rate of privatization of power distribution in recent years has been poor with only Delhi (North Delhi Power, BSES Yamuna and BSES Rajdhani) being notable exceptions.
  
  Privatization of power distribution has resulted in huge benefits to the consumer, and the government is very cognizant of this. However, for reasons that could include weak political will, the process of privatizing power distribution has not acquired the desired momentum. In recent times, privatization of the circles of Kanpur, Agra and Nagpur, could be completed but not before encountering major hurdles.
  
  As a vision for 2020, one can only hope that the government is able to garner enough political will to propagate the culture of privatization of power distribution. The atrophied power distribution sector urgently needs private sector managerial efficiency and it would be in national interest to see loss-making power distribution circles being expeditiously brought under the private sector ambit.
  
• India has taken initial steps in bringing in the futuristic Smart Grid technology. The Smart Grid Task Force appointed last year is expected to gain some traction in the coming years and by 2020, one can expect India to have achieved some demonstrable progress on the Smart Grid front. For one, the pilot Smart Grid project that Power Grid Corporation of India is implementing in Puducherry is expected to be commissioned. This will be a useful benchmark to establish India's technical competence with elementary infrastructure that would go into commercial Smart Grids in future. Apart from this, one can expect that India is able to create enabling infrastructure that would form the basis of the future Smart Grid.

What one could expect with a fair degree of confidence is that by 2020 all electric connections would be equipped with Smart Grid-enabled meters. These meters would offer basic Smart Grid facilities like time-of-day (also referred to as time-of-usage) metering. A pilot project to this effect has already been proposed in some areas of Delhi, and it is likely that all power distribution circles that are under private sector management will at least have ToD metering in place by 2020.

Another important expectation that one could have for 2020 is significant progress in setting standards for goods and services relating to Smart Grid. Organisations like IEEE-SA are actively involved in this exercise and one can look forward to tangible results by 2020.

Solar Energy: The government has embarked on the Jawaharlal Nehru National Solar Mission (JNNSM) that envisages as much as 20 GW by 2020. For a country that had barely 1 mw of grid-connected solar power capacity before the mission was launched in 2010, this is a very ambitious target. Currently, India's solar capacity (gridconnected) is over 1 GW and much of this has come from projects under the solar mission. Apart from the JNNSM, various states like Gujarat, Rajasthan and Karnataka are running their own solar power programmes.

Over the recent past, solar power tariffs have dropped very sharply - from an average of Rs.12.16 per kwh in JNNSM (Batch I) to around Rs.8.77 per kwh in Batch II. Very recently, one developer even quoted Rs.6.45 per kwh for a project in Rajasthan, which industry circles believe is the lowest tariff quoted ever.

For the solar power industry, one can expect that by the year 2020, tariffs were progressively drop thanks to capital equipment (mainly photovoltaic) getting cheaper by the day. However, there are some international trends that need to be considered. India is considering imposing antidumping duties on solar cells and modules imported from China and USA. Further, China is also pursuing a mammoth solar power programme that might propel domestic consumption of solar equipment.

India would need to move towards building a manufacturing base if it needs to have better control over costs of solar power generation. In the years leading up to 2020, India could be seen making the groundwork for indigenous production of solar cells. Apart from gridconnected solar plants, India will also see progress in standalone solar power installations that would help electrify remote villages where reaching grid power would be technically and commercially unviable.

Wind Energy: This has been the mainstay of India's renewable energy pursuits. Today, around 75 per cent of India's renewable energy capacity of some 26 GW comes from wind energy. During the period 2010 to 2012, India could add 2.5 GW of new wind power capacity on average - a sharp increase over the 1.6 GW that it did during the period 2006 to 2009. However, wind power capacity addition appears to be heading for a slowdown as the government is contemplating withdrawal of fiscal benefits like generation-based incentives and accelerated depreciation. The government is attempting to make wind power an avenue of green power generation more than a means to avail tax breaks. Curbing of fiscal incentives is ostensibly to weed out the "non-serious" players.

By 2020, one can expect a robust framework on the policy front, especially measures that ensure that wind energy is an exercise in "power generation" and not just "capacity addition". India could also be seen making progress in the direction of re-powering of turbines, which means replacing low-rating turbines installed in the early days by high-rating ones. Over the next few years, turbines of ratings of 3-mw or higher could mark their presence. This could result in higher capacity without additional geographical footprint. The period from now to 2020 could also see India beginning to explore the possibilities of offshore wind farms. Wind energy will also be seen contending with solar power that is currently in the government's sharp focus.

Energy Efficiency: With India's power consumption expected to grow by at least 7 per cent annually over the next 10-15 years, there are bound to be constraints over fuel security. Though inexhaustible energy sources like the sun and wind are expected to make a significant contribution, the core energy needs will continue to come from fossilbased sources.

India would need to therefore bring in greater amount of efficiencies both in the way power is generated and in the way it is consumed. Use of fossil fuels will have to be done in a way that there is no compromise on India's carbon footprint. At the same time, consumers must ensure that electricity is used up in the most efficient manner. By 2020, both generators and consumers will have become increasingly conscious of energy efficiency.

While efficiency in power generation will come largely from technological advances, efficiency in consumption will come out of demand-side management. In terms of power generation from fossil fuels, technologies like ultra supercritical coal-based power generation, coal gasification, etc.

By 2020, India is expected to take up demand side management on a serious note. In this context, usage of energy efficient appliances will be of utmost importance. Lighting that consumes an estimated 20 per of the total electricity consumption will have undergone a major transformation. Traditional lighting devices like incandescent lamps will be discarded making way for CFL and even LED lighting. By then, technology would have pushed down prices of these products substantially.

The Bureau of Energy Efficiency that is setting standards for energy-efficient appliances will have a greater role to play in the coming years. More and more appliances will have come under mandatory certification for energy efficiency. Along with this, enforcement of energy efficiency standards will also have improved significantly.

By 2020, one can also expect that some urban centres will have commercial Smart Grids in operation, even if they offer elementary capabilities. The facility of Time of Day or Time of Usage metering will be a very important feature of demand side management. Pilot projects for ToD metering have been initiated in cities like Delhi, and by 2020, one can look forward to ToD metering put into practice by a significant number of cities, going a long way towards demand side management.

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