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Corporate Strategy for Energy Industries

The document discusses options available to energy intensive industries to address high power costs in India. It outlines 7 options: 1) setting up a captive power plant, 2) outsourcing operation of captive plants, 3) open access to distribution networks, 4) improvements to distribution company management, 5) controlling operating times, 6) using non-conventional energy sources, and 7) implementing energy conservation measures. The Electricity Act of 2003 provides these new opportunities to industries by reforming the power sector and introducing more competition.

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13 views12 pages

Corporate Strategy for Energy Industries

The document discusses options available to energy intensive industries to address high power costs in India. It outlines 7 options: 1) setting up a captive power plant, 2) outsourcing operation of captive plants, 3) open access to distribution networks, 4) improvements to distribution company management, 5) controlling operating times, 6) using non-conventional energy sources, and 7) implementing energy conservation measures. The Electricity Act of 2003 provides these new opportunities to industries by reforming the power sector and introducing more competition.

Uploaded by

api-3767061
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
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CORPORATE STRATEGY FOR

ENERGY INTENSIVE
INDUSTRIES
EVOLUATION OF POWER INDUSTRIES

¾ In earlier days, due to low priority,


Generation Plants were privately owned.
¾ System of Licensee
¾ For better reliability in the post-
independence period, power industry was
nationalized.
CURRENT STATE OF AFFAIRS

¾ Due to various reasons, cost of power generation,


except in hydro, is very high.
¾ Energy intensive industry find it difficult.
¾ Monopolistic status cause of inefficiency and high
cost.
¾ For competition, Reforms are being undertaken in
the power sector.
¾ Central Sector has enacted Electricity Act 2003.
¾ Electricity Act 2003 provides new options to the
industries.
ENERGY INTENSIVE INDUSTRIES CAN
ADOPT ONE OF THE FOLLOWING OPTIONS :

¾ Captive Power Plant


¾ Outsourced Captives
¾ Open Access in Distribution
¾ Better Managed Distribution Companies
¾ Control over, time of operation
¾ Non Conventional Source of Energy
¾ Energy Conservation.
1. Captive Power Plant

¾ Captive Power Plant can be set up by any person.


¾ Can be set up by Co-operative Society or
Association of persons.
¾ Opens new opportunity for structuring Captive
Generating Plants.
¾ CPP can be provided with open access
transmission facility.
¾ Charges to be decided by GERC / CERC.
2. Outsourced Captives :

¾ Required expertise for operating CPP is missing.


¾ O&M can be outsourced.
¾ Possible to get CPP on lease.
3. Open Access in Distribution

¾ Open access in Distribution upto 5 MW.


¾ Connected load consumer will be free to choose
the supplier.
¾ Connected load beyond 5 MW - can avail open
access.
¾ No obligation to buy power from local discom.
¾ Regulatory mechanism is yet to be formulated.
¾ Without investment, benefit can be availed.
4. Better Managed Distribution Companies :

¾ Brisk pace of reform is underway


¾ Will improve quality and reliability
¾ With competition, tariff expected to come down.
5. Control over, time of Operation :

¾ Industries can increase the drawal


during night to obtain substantial benefit
in the tariff.
6. Non Conventional Source of Energy :

¾ Act provides big thrust on non-conventional


sources of energy.
¾ Increasing consciousness on pollution caused by
fossil fuel.
¾ Encourage energy intensive industries the large
incentive source being given by State & Central
Govt. in the form of benefit, subsidies etc.
¾ They can wheel the power to their plant.
¾ Also easy carbon credits, which could be traded
in future.
7. Energy Conservation :

¾ Focus on Energy Audit


¾ Adoption of new Industry – Plant design.
CONCLUSION :

There is no ready made solution.

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