India’s transmission and distribution (T&D) losses in the power sector are ‘substantial’ and are very high compared to peer nations, flagged the Economic Survey for 2020-21.
The T&D losses represent electricity that is generated but does not reach intended customers.
India’s T&D losses have been over 20 per cent of generation, which is more than twice the world average. The ideal level of T&D losses ranges between six to eight per cent.
According to the Central Electricity Authority’s latest report of October, 2020 the T&D losses had declined to 20.66 per cent in 2018-19, from 21.04 per cent in 2017-18, and 21.42 per cent in 2016-17.
‘T&D losses have been declining since 2001-02 but are still substantial. As compared to the T&D losses of the peer countries. India’s T&D losses are very high,’ the survey stated.
The observation assumes significance in view of the stressed power sector because of cash strapped discoms which are finding it difficult to make timely payment for electricity supply by generation firms (gencos).
As per the Payment Ratification And Analysis in Power procurement for bringing Transparency in Invoicing of generators portal, the discoms’ total outstanding to gencos stood at over Rs 1.39 lakh crore as of November 2020, which includes Rs 1.26 lakh crore of overdue amount.
The outstanding dues become overdue when discoms do not pay gencos for supply of power after 45 days of generation of the bills.
The huge overdue amount shows that there is a liquidity crunch with the discoms. In order to deal with the issue, the centre had announced a liquidity infusion package for discom with an outlay of Rs 90,000 crore which was later expanded to Rs 1.2 lakh crore.
The survey also said that the power sector has witnessed substantial transformation from both the demand (universal electrification) and supply-side (the advent of green energy).
Commendable progress has been made in the generation and transmission of electricity in India, it said adding that the total installed capacity has increased from 3,56,100 MW in March-2019, to 3,70,106 MW in March 2020.
Further, the generation capacity increased to 3,73,436 MW in October-2020, and comprised 2,31,321 MW of thermal, 45,699 MW of hydro, 6,780 MW of nuclear, and 89,636 MW of renewables and others.
The capacity addition in the power sector was mainly driven by the government in the year FY20, it added.
The decline in energy deficit may be partially attributed to enhanced energy efficiency and improved energy intensity in India, it observed.
Energy intensity is defined as the quantity of energy required to produce a unit of output. Therefore, lower the energy intensity, better it is.
The energy intensity of India (at 2011-12 prices) decreased from 65.6 toes per crore rupees in FY12 to 55.43 toes (tonnes of oil equivalent) per crore rupees in FY19.
At the same time, the per capita consumption increased from 0.47 toe in FY12 to 0.58 toe in FY19, it added.
In 2014, the central government approved the Integrated Power Development Scheme (IPDS) to facilitate state utilities to ensure quality and reliable 24×7 power supply in the urban areas with a total outlay of Rs 32,612 crores.
So far, projects worth Rs 30,991 crores have been sanctioned to the states and the distribution strengthening has been completed in 442 of the 546 circles till the end of September-2020, it observed.
Further, the country has already accomplished two major landmarks in the rural electrification arena. Firstly 100 per cent village electrification under Deen Dayal Upadhyaya Gram Joyti Yojana, and secondly universal household electrification under ‘Pradhan Mantri Sahaj Bijli Har Ghar Yojana’ (Saubhaagya).