Power Sector - India

March 2009

Executive Summary
India has 5th largest electricity generation capacity in the world The installed capacity of India as of July 2008 was X MW India is facing acute power deficit with peak power deficit of about x% Power trading is still at nascent stage with merely y% of the power generated traded in 2007-08 Distribution is primarily controlled by state electricity boards (SEBs) Government policies are aimed at encouraging investment in the sector and increasing the competition Government allows 100% FDI under the automatic approval route in all segments of the industry (except atomic energy) 5-year tax holiday is given for power generating projects Import duty at the confessional rate of x% has been set for import of equipment Key Trends: Increase in per capita consumption of electricity, Increase in corporate investments, Increase in FDI, increasing interest shown by PE/VC firms in power sector and surge in captive production Challenges: Shortage of coal, power loss in transmission and distribution, ageing and improperly maintained infrastructure Public sector undertakings like AA Ltd , BB Ltd hold the majority of the total installed capacity Private players including ABC, XYZ have presence across value chain and making significant investments in power sector Foreign players like XY, ZY, AY have entered/planning to enter Indian power market
POWER SECTOR INDIA.PPT

Market Overview & Value Chain

Government Policies & Incentives

LE P M A S

Key Trends & Challenges

Competition

 Introduction Power Sector Overview Value Chain Analysis Government Policies and Initiatives Key Trends & Challenges Competitive Landscape Key Developments Appendix

POWER SECTOR INDIA.PPT

Installed capacity has been increasing continuously to meet the need of growing economy..
Supply Side
India has 5th largest electricity generation capacity in the world Installed capacity of X MW as of July 2008
Nuclear Renewable Gas-based y% v% z% Hydel power x% w% Thermal

Plan-wise Installed Capacity

MW 140,000 120,000 100,000 80,000 X W Plan VII VIII IX X Y Z

Demand Side

Demand for power is growing at x% per annum Demand has five key components:

LE P M A S
60,000
250,000 200,000 150,000 100,000 50,000 0
POWER SECTOR INDIA.PPT

Current and projected demand

MW Energy Required Planned Demand Y X
500 0

bn units Z
1,500 1,000

Industry, commercial, residential, agriculture, and others

Key drivers of increasing demand are growth in:

Household consumption Electrification of rural areas Manufacturing growing faster Realization of suppressed demand due to load-shedding

Required investment of ~USD X bn by 2017

Source:

XI

XII

Public sector companies or State Electricity Boards (SEB) have presence across the value chain
Raw materials

Generators

Traders

Transmission

LE P M A S
----- ----- ----- ----- ----- -----POWER SECTOR INDIA.PPT

----- ------

Distribution

End user
Source:

Public Private Partnership (PPP) model is not witnessing much activity compared to other sector in infrastructure
PPP Model - Overview
India has around x projects under the public private partnerships in infrastructure The power sector in India has not witness much PPP activity as compared to other sectors
Power sector witnessed investments worth USD XX bn Airports Railways Energy z% y% u% Urban Development x% w% v%

Government is encouraging PPP model to meet the capacity addition target of XY MW in XIth Plan

Government plans to promote PPP model in ash utilization, augmentation of transmission lines and distribution

LE P M A S
POWER SECTOR INDIA.PPT

Ports

Road

Types of public private partnerships in India

Distribution Franchisee

Ultra Mega Power Projects (UMPP)

Source:

Key Trends

Increase in per capita consumption

Increase in captive power production

Increase in domestic investments

Trends

PE firms showing interest in power sector

Increase in FDI

POWER SECTOR INDIA.PPT

Challenges

Inability to meet the capacity addition targets

Shortage of coal

Challenges

Ageing and improperlymaintained infrastructure

Huge power loss in transmission and distribution

POWER SECTOR INDIA.PPT

Majority of the installed power capacity in India with public sector undertakings
Public Sector Players
Company Name
AA Ltd BB Ltd CC Ltd DD Ltd EE Ltd

Generation

Transmission

Distribution

Revenues (FY2007-8) USD bn

EBITDA (FY2007-8) USD bn USD mn USD mn USD mn USD mn

Total Capacity -- MW -- MW -- MW

AA Ltd is the sixth largest thermal power producer in the world and Indias largest power producer. It accounts for x% of the countrys installed capacity. It plans to invest up to USD XX bn by 2012 to transform itself into an integrated regional energy player and have an installed capacity of over X MW BB Ltd plans to increase the power generation capacity to over X MW by 201112 CC Ltd has 5 plants under construction adding X MW by 2012 DD Ltd is responsible for inter-state transmission of electricity. The company reported revenue of USD X bn in FY200708 EE Ltd is the Government of India initiated public private partnership, formed for the purpose of trading of power

LE P M A S
POWER SECTOR INDIA.PPT

USD mn USD bn USD bn USD mn

Source: