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Technical Issues in the Electricity Sector

Power Sector Efficiency

Electricity generation is among the eight core infrastructure sectors of India. Its importance is evident from the “weight” that has been assigned to it. The sector carries a weight of 10.3 while steel comes next at a mere 6.7.

Also, thermal power generation accounts for about 65 percent of the total electricity generated in India. Coal-based plants account for the bulk of the thermal power capacities, followed by gas-based units. That is not surprising, given that India is third-larges largest producer of coal globally, and yet, is also the fourth-largest importer of coal.

India’s need for importing such huge volumes of coal (it imports an estimated 30 percent of its coal needs, which helps meet at least 15 percent of power plant needs) arises, at least in part, from the fact that much of the coal produced in the country is of a relatively inferior grade. Only a small part of India’s coal reserves is of the anthracite variety, with the rest being of the bituminous, the higher-carbon grades preferred by the power plants, are less commonly produced. That poses a dilemma for the coal-fired thermal plants-to either use sub-quality coal that leads to lower energy generation or import a sizable tonnage of coal at higher prices to mix and improve the overall output.

India has around 20 coal-fired thermal plants with capacities of 2000 MW or above while the average energy efficiency of these plants is a mere 32.8 percent. The average CO2 emission of these plants was 1.08 kg per kWh, which was 14 percent higher than China’s. Efficiencies of some of the coal-based power plants were found to be as low as 16 percent. Low plant efficiency not only leads to burning of more coal in the plants but also adds to the volume of CO2 produced.

While there has been much concerted effort to increase generation of electricity from renewable energies such as solar and wind, the reality is that these capacities could take years to build. India has set a target to build 100 GW of capacities by 2022 at a cumulative investment of $100 billion. However, India’s grid-connected renewable power capacity, excluding hydel but including solar, is currently estimated at around 37,000 MW.

By comparison, thermal power is the mainstay of electricity generation in India. It stood at over 196 GW in 2015, of which coal-based capacities alone amounted to 171 GW. Also, Make in India program envisages addition of another 175 GW of thermal power capacity by 2022.

Thermal plants being the mainstay of power generation in India, there has been a crying need to raise efficiencies and energy output and also bring down emissions within acceptable limits. With the 2015 Paris agreement of global leaders on climate change, where India too has been a signatory, it has become even more imperative to accelerate a modernization program of power plants in the country.

Renovation and modernization of power plants

In order to bridge the gap between demand and supply, especially in the context of limited financial resources available, it has become imperative to look for other options which are not as capital intensive as new capacity addition and which could be implemented in a comparatively shorter time frame. In this regard, optimum utilisation of existing installed capacity in the country to maximise the generation through Renovation & Modernisation (R&M) of existing power plants is considered to be the most cost effective option.

The importance of R&M was recognised by the Government of India way back in 1984 when PHASE-I R&M Programme for 34 thermal power stations in the country was launched by the Central Electricity Authority as a Centrally Sponsored Scheme.

The Government of India has now accorded high priority to R&M and Life Extension (LE) of old existing power plants. The funds in the form of loan assistance at concessional interest rates are being provided by the Government through Power Finance Corporation (PFC) for R&M works

At the time of Independence, power generating capacity in the country was 1362 MW only. Many new units were installed after Independence. Up to 1980, the total installed capacity of thermal power stations was 14,250 MW which comprised many imported units of sizes from 30 MW to 120 MW. The average Plant Load Factor (PLF) of thermal power stations during 1976-77 was 56%. However, due to various reasons, the PLF gradually started deteriorating. As a result, thermal generation fell short of the targets, leading to a power shortage of about 11%, as compared to the requirement at that time.

A number of efforts were made to improve the operation of the units. Task Forces/Roving Teams consisting of experts from CEA, BHEL and ILK were constituted, which went around various thermal stations with a view to identify the defects/reasons for poor performance and to prepare action plans to address the problems. Based on the reports of Roving Teams, many State Electricity Boards (SEBs) prepared schemes for attending to the problems identified and included them in their annual plans. However, lack of adequate funds with some of the States led to lower priority being given to such programmes though there was an urgent need to attend to the problems of the thermal stations.

Causes for poor performance

The reasons identified for poor performance of thermal stations included the following:

  1. Design deficiencies, manufacturing and generic defects.
  2. The Operation and Maintenance (O&M) deficiencies causing prolonged and repetitive forced outages.
  3. Inadequate and non timely availability of spare parts especially for imported equipment.
  4. Lack of resources with SEBs even for making payments to BHEL against supplies & services and for coal supplies to coal companies. Accordingly, they were not able to take up the Renovation & Modernisation programmes to the extent required.
  5. The quality of coal being supplied had deteriorated as compared to the deigned quality. Besides, the coal had high ash content and contained stones, boulders, shale and sand.
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