India Country Market
Insights and Opportunities
Electric Power Generation Sector
Overview: Both government and private sector firms generate electric power in India, with the government sector leading the pack. National Hydroelectric Power Corporation, National Thermal Power Corporation and various state level corporations (state electricity boards - SEBs) are the major players. The transmission and distribution is by the State Electricity Boards (SEBs) or private companies. There has been significant improvement in the growth in actual generation over the last few years. The total installed capacity as on 31 March 2009 is about 147 000 MW, of which private sector companies produce about 13.5% , Central government own 34% and remaining 52.5% is produced by various state governments. However, the current electric power supply is 30 percent less than the demand. To support the rapidly growing Indian economy, the governments must increase electric power production immediately. The financial losses of the power sector remain a burden on public sector finances.
The World Bank, ADB and other international agencies have recommended power sector related reforms in the country. The Integrated Energy Policy document has estimated energy requirements in the year 2030 to be about 950,000 MW. According to the Indian Prime Minster, Dr. Manmohan Singh, the government will help and promote public - private partnerships to meet the estimated $1.2 trillion investment required over the next 25 years to provide electricity to consumers at an affordable cost. The U.S. continues to be one of the largest exporters of generation and transmission equipment to India along with Germany, Japan and U.K.
Opportunities: The government of India has set an ambitious goal, which is to provide power for all by 2012. This mission would require that the installed generation capacity should be at least 200,000 MW by 2012 from the present level of 147, 000 MW. The power requirement will double by 2020 to 400,000MW. About one-fourth to one-third of this growth will come from Independent Power Producers (IPPs), with the rest coming from the public sector. It is estimated that building 100,000 MW in additional power capacities and associated transmission & distribution infrastructure will require an investment of $ 170 billion.
Given the Government of India's commitment to push through reforms and recent policy initiatives to encourage T&D, the demand for T&D equipment is expected to grow. American power equipment suppliers will find significant sales opportunities in power distribution transformers, high voltage power cables, relays, conductors, capacitors and circuit breakers. There are excellent prospects in Supervisory Control and Data Acquisition (SCADA) and Energy Management (EMS) systems to effectively integrate distribution automation with demand side management. Indian T&D companies are seriously exploring their right-of-way to establish fiber-optic and telecommunication networking for new commercial opportunities in the cable Internet and e-commerce operations.