Torrent power a

Distribution Franchise

…prsented by : Arpit Saran

Torrent Power – At a glance

 Part of Rs. 8200 Crore Torrent Group

• Pharma (Turnover ~ Rs. 1916 Crores)
• Power (Turnover – Rs. 5958 Crores)
• Licensee in Ahmedabad, Gandhinagar & Surat
Distribution
• Franchisee in Bhiwandi, Agra & Kanpur*

Integrated Power 1647.5 MW Capacity

Company Generation • 500 MW at Ahmedabad
• 1147.5 MW near Surat

Transmission • JV with PowerGrid for 400 KV network

* - yet to takeover operations

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Present Distribution – Drawbacks! Before Torrent

 High AT&C losses

 Frequent power failures due to very old and dilapidated network
 Massive load shedding
 Low customer satisfaction
• Customer service standards are poor
• Lengthy and tedious mechanisms for resolving consumer
grievances
 Uninspiring work culture
 Old and obsolete technologies still being used
 Unacceptable safety standards

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Present Distribution Scenario – High Distribution losses

23.2
25
16.4
20

15 10.6
8.5
6.7
10

0
India Russia China Brazil World

Distribution losses in developing countries in 2008

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Source: Think BRIC – Comparative Study of Power Sector by KPMG- Jan 2010
Need of the hour

 The power sector requires huge capital outlay to reduce the current deficit
and to sustain future GDP growth

 It is not possible for the government to fund the growth of the sector on its
own

 Investment are forthcoming in Generation from the private sector but it is

not sustainable if distribution reforms are not undertaken

 The government has embarked on an aggressive mission – “Power for All

by 2010” and the private sector has a key role in achieving the objectives
stated in the mission

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Benefits of Franchise Model

 Reduction in technical losses and theft

 Improvement in Metering, Billing and Revenue Collection

 Capital investments in upgradation of the network

 Enhancement in customer service quality

A win-win scenario for all:

Consumers, DISCOM and Franchisee

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Technical Benefits

 State of the art distribution system in franchise area

 Lower peaking load due to better technical T&D management

 Better overall grid stability due to lower system interruptions

 Improvement in reliability parameters like SAIFI, SAIDI,

CAIDI, etc.

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Financial Benefits to the State

 Assured returns from distribution franchisee

 No investment in the franchise area by licensee

 Reduction in losses

 Contribution to the Government exchequer

• Increase in collection of Electricity Duty as the metering and billing
becomes more accurate

• Increase in collection of other Central and State taxes pursuant to

growth of economy of franchisee area

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Better services to Customers

 Improved services

• Faster new connections/ load extensions

• Lower attendance time for faults

• Grievance Redressal mechanism

• Convenient bill payment facilities

 Better availability and quality of power

 Increased customer satisfaction

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What is a Franchisee?

As per Definitions of The Electricity Act, 2003

“franchisee” means a person authorised by a distribution licensee to
distribute electricity on its behalf in a particular area within his area of
supply;

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Features of Input Based Distribution
Franchise
Role of a franchisee

State DISCOM
to supply power at Fault Restoration
Planning
EHV substations
All Obligation and Rights of a
O&M

Distribution Licensee
Revenue Collection

Construction
Energy Input Meter Reading Customer Care CAPEX
Metering

Generation Transmission Distribution

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Responsibilities of Distribution franchisee

 Purchase of power
 From Licensee at EHV substations feeding the franchise area

 Network Related
 Network analysis and improvement planning

 Make capital investment for renovation/ upgradation of network

 Distribution asset maintenance

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Responsibilities of Distribution franchisee

 Consumer Related
 Metering

 Meter reading

 Billing as per Regulatory Commission’s approved Retail Tariff

 Collection (both current revenues and arrears)

 Issuing new connections

 Adherence to all relevant Regulations of ERC including Supply Code

and SOPs

 Attending consumer grievances

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Commercial Terms

Payment by DF
L
Charges for input energy as quoted by franchisee
Arrears collected
I
Security Deposit for new connections
Electricity Duty etc C
D E
F N
Payment by Licensee S
Incentive on recovery of arrears
Subsidy
Specified payments upon termination / expiry
E
E

Competitive bidding ensures that the State Discom gets the

right price for input energy
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Agra

International Tourist Place

Area : 188 Sqkms

Population : 23 Lacs

Customer base : 4.2 Lacs

Peak Demand : 420 MVA

Energy Input : 1800 MU

33KV OH Line : 230 Kms

33/11KV Substations : 38 Nos

11KV OH Line : 713 Kms

DTCs : 3269 Nos

HT Consumers : 350 Nos

LT Network : 1500 Kms

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Agra : At the time of takeover
 AT&C losses : 80%
 Mandatory load shedding of 6 hours at the
time of takeover and subsequently
increased to 8 hours
 Further distress load shedding due to
deficit of 300 MVA in EHV Network
 Overstressed distribution Network
• Overloading
• Breakdowns / trippings
 Distribution transformer failure rate of 60%
 Poor reliability of supply
 Only 23% of the customers have accurate
metering and there are many unregistered
consumers

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Overcoming the Challenge
Problem: Frequent Power Failures

Issue: 2 to 3 DTs failing everyday

Overloaded System
Frequent conductor breakdown
Lack of adequate maintenance leading to deterioration
of network
Long restoration time in case of faults

Measures: Failed DT replaced within 24 hours

24 x 7 control room to ensure faster restoration
All DTs revamped

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Overcoming the Challenge
Problem: Technical Losses

Issue: Overloaded feeders leading to higher I2R losses

Improper crimping at joints
Poor power factor of the system

Measures: Reconfigured the existing feeders

Added 29 new feeders to the existing 46 feeders
Added 125 MVA distribution transformer capacity
Proper termination and crimping provided
Installed capacitor banks to improve power factor

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Distribution System
22 KV feeders

Distribution Transformers and FSPs

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Shunt Capacitors

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 Overcoming the Challenge
Problem: High Commercial losses

Issue: Only 23% customers metered

Rampant theft of energy
No substantial action against non payment of bills

Measures: Provide systematic metering for accurately measuring

consumption of the customers
Securitization of the network and extensive vigilance
Filing of FIR in case of repetitive power theft
Streamline processes to improve collection efficiency
“Ujjwal Bhiwandi Abhiyan” for legalising connections

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Metering

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 Overcoming the Challenge
Problem: Safety

Issue: Lack of adequate clearance with lines

Transformers located at roadsides without any fencing
Double feed through hooking
LT/HT lines in poor condition (conductor snapping)
Measures: Lines replaced by underground cables at critical
locations where clearance are issue
Earthing provided for all poles, transformers
Removal of double feed
Fencing provided for transformers
Lines replaced, where necessary
Public Safety Awareness programs

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LT Network Revamping

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Safety

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Overcoming the Challenge
Problem: Customer Service

Issue: No concept of customer service

No consumer redressal system
Customers had lost confidence in utility

Measures: Call Center started from Day One

Customer friendly bill introduced
2 Customer Service Centers Opened
Customer Redressal Mechanism established
Mobile Van as a value added service

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24 x 7 Call Center

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Customer Care Centers

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The results
Major Accomplishments :
Distribution Transformer Failure Rate

At the time of takeover

As on April 2010

60% 2.8%

DT Failure Rate reduced by 57%

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Major Accomplishments : Load Shedding

At the time of takeover

At present

10 to 12 Less
hours than 3
Hrs

Reduction in losses has improved power

reliability in the area

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Major Accomplishments : Accurate Metering

At present

At the time of
takeover

23% 92%

99% of sales is based on actual reading.

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Key Requirements for DF arrangement
Key Requirements for DF Arrangement

 The required power should be made available

• Despite the marked improvement brought in Bhiwandi, change not
visible as load shedding continues
• Customers want quality power 24 x 7
• Availability of adequate upstream infrastructure (Transmission
Capacity) to cater to the demand in the franchise area
• Distributed Generation based Dist Franchisee is a step in the right
direction

Franchise should be provided with adequate power so that the benefits of the
improvement are realized

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Thank you