INDEX Sl. no.

1 2 3 4 Organisational Set-up in India 5 5 7 Functioning of Load Despatch Centres 8 9 Indian Electricity Grid Code Terms and Conditions of Tariff Regulations EHV AC Substations CEA Grid Connectivity Standards, Grid 10 Standards and Metering Standards 11 HVDC Systems 172 - 221 117-146 147-155 156-171 Regulatory Framework in Indian Power Sector Smart Grid Operations Ring Fencing of System operation & Independent 107-116 64 - 73 74-106

Topic Power Sector Overview of India Very Large Power Grid Operators Electricity Act 2003 Legal Framework, Policies & Regulations and

Page No. 2-27 28-39 40-49 50-63

TABLE OF CONTENTS No. 1 2 3 4 5 6 7 8 9 Introduction Current Scenario Future Plans for capacity addition Regulatory Environment Planned Development in Transmission Programme of development of National Grid Control Centres Planning Code for Inter-State Transmission Conclusion Topic

OVERVIEW OF INDIAS POWER SECTOR 1.0 Introduction 1.1 Electricity Supply Chain Electric power supply system in a country comprises of generating units that produce electricity; high voltage transmission lines that transport electricity over long distances; distribution lines that deliver the electricity to consumers; substations that connect the pieces to each other; and energy control centers to coordinate the operation of the components. The power plants typically produce 50 cycle/second (Hertz), alternating-current (AC) electricity with voltages between 11kV and 33kV. At the power plant site, the 3-phase voltage is stepped up to a higher voltage for transmission on cables strung on cross-country towers. High voltage (HV) and extra high voltage (EHV) transmission is the next stage from power plant to transport A.C. power over long distances at voltages like; 220 kV, 400 kV, 765 kV & 1200 kV. Where transmission is over 1000 km, high voltage direct current transmission is also favored to minimize the losses. Sub-transmission network at 132 kV, 110 kV, 66 kV or 33 kV constitutes the next link towards the end user. Distribution at 11 kV / 6.6 kV / 3.3 kV constitutes the last link to the consumer, who is connected directly or through transformers depending upon the drawl level of service. The transmission and distribution network include sub-stations, lines and distribution transformers. High voltage transmission is used so that smaller, more economical wire sizes can be employed to carry the lower current and to reduce losses. Sub-stations, containing step-down transformers, reduce the voltage for distribution to industrial users. The voltage is further reduced for commercial facilities. 1.2 Sources of Power The fossil fuels such as coal, oil and natural gas, nuclear energy, and falling water (hydel) are commonly used energy sources in the power generating plant. A wide and growing variety of unconventional generation technologies and fuels have also been developed, including cogeneration, solar energy, wind generators, and waste materials. Coal: Is naturally available and less expensive and its gestation Period is 2-3 years. But it is non-renewable, contains C,S,H,O, the exhaust contains poisonous gases such as SOx, Arsenic and other green house gases, causes air pollution, fly ash disposal is a major problem Hydro: Is naturally available & renewable, but seasonal. There are no emissions and hence no pollution, but it disturbs the eco balance and has higher initial cost. The gestation period is 4-5 yrs. Hydro power investment is attractive on various counts proven technology, low O&M costs; high energy conversion efficiency of around 70% Nuclear :There is abundant availability of nuclear resources in the world. It is more efficient than coal (Nuclear fission releases almost 10 million times greater energy than what is released by burning of an atom of fossil fuel), there are no Carbon, NOx, SOx Emissions, but the

initial cost and gestation period (6 yrs) is more. The cost of building reactors is enormous, the biggest expense being storage of nuclear waste. Renewable Energy : Sustenance of energy demand cant be achieved through fossil fuels as the limited reserves are fast depleting. Global warming and Clean Development drive is forcing countries to reduce polluting industries. Carbon Credits are encouraging companies to go in for captive renewable energy investments. Solar Energy There is no pollution, no greenhouse gas emissions, and is flexible and expandable. After initial investment, no further cost associated. But the initial cost is the main disadvantage of installing a solar energy system. Large areas of land and intense sunshine is required The Union Government announced the Jawaharlal Nehru National Solar Mission, aiming to make India a global leader in solar energy. The mission envisages an installed solar generation capacity of 20,000 MW by 2020, of 100,000 MW by 2030 and of 200,000 MW by 2050.Total funding from the government for the 30-year period will be approximately Rs850 billion to Rs1,050 billion. Wind Power: Is renewable and abundant but specific to certain areas, modular establishment is possible. There are no emissions & no GHG. The gestation period is quite less (8-10 months), but is currently expensive (Capital cost: Rs 5.5 6 Cr/ MW). In terms of wind power installed capacity, India is ranked 5th in the World after the US, Germany, Spain and China with a wind power installed capacity (cumulative) of about 15,000 MW up to 31.08.2011 (vers potential of 48,000 MW).Top states in India with wind power capacity : Tamil Nadu, Maharashtra, Karnataka, Gujarat and Rajasthan. Government of India has announced generation-based incentive of Rs0.50 / unit of electricity from wind power projects, subject to maximum of Rs6.2 million per MW to increase investor base. The study, Wind Energy Outlook 2009, also indicates that wind energy can provide up to 24 percent of Indias power needs by 2030, while creating 213,000 green jobs and cutting 5.5 billion tons of CO2 emissions. Government of India is planning to infuse around Rs.600 billion in next few years under 11th five year plan in this industry, which will boost the growth of this sector and help reach this estimated installed capacity Fuel Cell : Fuel cells eliminate pollution caused by burning fossil fuels; the only byproduct is water. They have a higher efficiency than diesel or gas engines. Maintenance is simple since there are few moving parts in the system. Production, transportation, distribution and storage of hydrogen is difficult. Refueling and the starting time of fuel cell vehicles is longer. Currently expensive to produce as technology is not yet fully developed

Bio Energy: It can be produced using organic waste material that might otherwise be discarded. Energy in plants is captured and stored. It does not fully relieve pollution of the atmosphere. Biomass has a smaller energy content for its bulk than fossil fuels. Costs of labour, transportation, and storage are higher. Currently, globally, biomass contributes 14% of the total energy supply worldwide and 38% of this energy is consumed in developing countries, predominantly in the rural and traditional sectors of the economy.

Renewable Energy Target for Achievement Total Programme/ 2011-12 during the achievement Systems month during August, 2011 2011-12

Cumulative achievement up to 31.08.2011

I. POWER FROM RENEWABLES: A. GRID-INTERACTIVE POWER Wind Power 2400 Small Hydro Power 350 Biomass Power 460 Bagasse Cogeneration Waste to Power Urban 25 -Industrial Solar Power (SPV) 200 Total 3435

(CAPACITIES IN MW)
266.00 21.00 25.00 12.5833.00 111.30 86.50 111.50 14989.00 3153.93 1083.60 1779.03

1.20

1.20

20.20

53.46 46.16

325.70

8.50 1152.00 21125.38

B. OFF-GRID/ CAPTIVE POWER (CAPACITIES IN MWEQ) 3.50 Waste to Energy0.75 10.18 72.30 Urban 15.00 -Industrial 2.55 31.99 327.95 Biomass(non80.00 bagasse) Cogeneration Biomass Gasifiers3.00 0.72 1.20 15.55 Rural 10.00 2.96 125.88 - Industrial 4.50 Aero0.50 0.12 1.24 Genrators/Hybrid systems SPV Systems 20.00 0.42 3.50 72.50 (>1kW) Water mills/micro 400 143 Nos. 143 Nos. 1818 Nos. hydel Nos. Total 128.50 7.40 51.49 618.92 II. REMOTE VILLAGE ELECTRIFICATION 688 No. of Remote 500 Village/Hamlets provided with RE Systems III. OTHER RENEWABLE ENERGY SYSTEMS .07 Family Biogas 1.50 Plants (No. in lakhs) 0.04 Solar Water 0.60 Heating Coll. Areas (Million m2)
742 8846

.12

44.16

0.20

4.67

Source- MNRE website

Challenges for Renewable Energy Optimal pricing of power generated from the renewable energy sources. Quality and consistency issue of renewable power arising from the intermittent nature of electricity from wind and small hydropower. Costs of technology development and production need to be reduced significantly from current levels. Availability of financing especially project finance for Renewable Energy Slow pace of rural electrification and pace of reforms in the rural electricity sector

1.3 Energy Resource Distribution in the Country Hydro potential in North east and upper part of Northern Region Coal reserves mainly in Eastern Region Distribution of energy resources and consumption centres are extremely unbalanced Necessitate power transfer over long distances 2.0 Current Scenario India's current installed capacity of power plants is 186654 MW as on 31 Dec 2011. Almost 55.7 per cent of this capacity is based on coal, about 9.5 per cent on gas, 0.6 per cent on diesel, 25.6 per cent on hydro, approximately 20.7 per cent on renewable sources and about 10.8 per cent on nuclear. Actual generation has grown at a compounded annual growth rate of above 5 % from 350,490 MUs in 1995-96 to 617,382 MUs in 2005-06 to 735,368 MUs in 2010-11. Over the years, the fuel mix has changed. The share of power from thermal sources decreased from 71 per cent in 1994-95 to 66 per cent in 2010-11. The share of hydro has been found in the range of 20-25%. An initiative to add 50,000 MW of hydro capacity by 2017 was launched in August 2003. The intent is to increase the share of hydro power generation to 40 per cent. As per the Central Electricity Authority (CEA) reviews the cost-effective hydro potential of India is about 84,044 MW, but it contributes just 38,748 MW at present. Growing environmental concerns and the increasing price of oil, gas and coal in the international market have led to an interest in renewable sources of energy (comprising wind energy, solar photovoltaic energy, biomass power and mini hydro plants). But despite great potential, renewable sources contribute only a little over 20162 MW at present. State Electricity Boards (SEBs) and the new state generation utilities have an installed capacity base of 83,605 MW that accounts for a share of 45% per cent. Sector-wise, the states contribute the maximum generation capacity. Power producers in the central sector, like NTPC,

NHPC and DVC, account for 31 % of installed generation capacity. The contribution of the private sector was 24 % in 2010-11. The PLF of generating plants has improved consistently over the last few years. The all India average PLF on Dec 2011 stood at 75.83 % compared to 60 % in 1994-95. The PLF of central plants in Apr11 to Dec11 was 80.15 % while the average PLF of the state sector units was close to 66.11 % The average PLF of the private sector was 78.09 %. 3.0 FUTURE PLANS OF CAPACITY ADDITION 3.1 Plan for Capacity Addition during XI Five Year Plan (2007-2012) An ambitious target of 78,700 MW has been set by the government for the eleventh plan period (2007 -2012). Of this, the hydropowers share would be 15,627 MW, the thermal power would constitute 58,693 MW and the nuclear powers share would be 3,380 MW. 3.2 Policy for Additional Capacity Generation Inadequacy of generation has characterized power sector operation in India. To provide availability of over 1000 units of per capita electricity by year 2012 it had been estimated that need based capacity addition of more than 1,00,000 MW would be required during the period 200212. Government of India has initiated several reform measures to create a favourable environment for addition of new generating capacity in the country. The Electricity Act 2003 has put in place a highly liberal framework for generation. There is no requirement of licensing for generation. The requirement of techno-economic clearance of CEA for thermal generation project is no longer there. For hydroelectric generation also, the limit of capital expenditure, above which concurrence of CEA is required, has been raised suitably from the present level. Captive generation has been freed from all controls. In order to fully meet both energy and peak demand by 2012, there is a need to create adequate reserve capacity margin. In addition to enhancing the overall availability of installed capacity to 85per cent, a spinning reserve of at least 5per cent, at national level, would need to be created to ensure grid security and quality and reliability of power supply. 3.2.1 Non-conventional Energy Generation The Ministry of Non-conventional Energy Sources is promoting development of small/mini hydro power projects. The potential of generation of power from small and mini hydel projects is estimated to be about 10,000 MW in the country. Feasible potential of nonconventional energy resources, mainly small hydro, wind and biomass would also need to be exploited fully to create additional power generation capacity. With a view to increase the overall share of non-

conventional energy sources in the electricity mix, efforts will be made to encourage private sector participation through suitable promotional measures. 3.2.2 Hydro Electricity Generation Hydroelectricity is a clean and renewable source of energy. Maximum emphasis would be laid on the full development of the feasible hydro potential in the country. The 50,000 MW hydro initiatives have been already launched and are being vigorously pursued with DPRs for projects of 33,000 MW capacity already under preparation. Harnessing hydro potential speedily will also facilitate economic development of States, particularly North-Eastern States, Sikkim, Uttaranchal, Himachal Pradesh and J&K, since a large proportion of our hydro power potential is located in these States. The States with hydro potential need to focus on the full development of these potentials at the earliest. Hydel projects call for comparatively larger capital investment. Therefore, debt financing of longer tenure would need to be made available for hydro projects. Central Government is committed to policies that ensure financing of viable hydro projects. State Governments need to review procedures for land acquisition, and other approvals/clearances for speedy implementation of hydroelectric projects. The Central Government will support the State Governments for expeditious development of their hydroelectric projects by offering services of Central Public Sector Undertakings like National Hydroelectric Power Corporation (NHPC). Proper implementation of National Policy on Rehabilitation and Resettlement (R&R) would be essential in this regard so as to ensure that the concerns of project-affected families are addressed adequately. Adequate safeguards for environmental protection with suitable mechanism for monitoring of implementation of Environmental Action Plan and R&R Schemes will be put in place. 3.2.3 Small Hydropower Plants The Electricity Act 2003 is the catalyzing and facilitating factor for the Power revolution in India. The concern that no households be left out from being electrified, is being aptly addressed by the Union and state Governments. Impetus is being given to Rural Electrification. In order to achieve this objective, synergy is to be evolved where distributed Power Generation supplements (or makes up for the limitation) of electric supply through grid. Besides this mission, initiatives for environmental conservation are propelling utilities to generate more of Green Power Decentralised Power Generation and Distribution has the power to adequately make up for the limitation of the Electric supply through Grid, and is considered a potential means to provide Power to all by 2012 DPG technologies such as Small Hydro Power help in producing power at the point of consumption. Hence there have been efforts to generate power, at the source of energy and at the place of consumption, using the Small Hydro

Potential available nearby. This can be a motivating factor for the local populace so that the pace of electrification can be increased. India has a Small Hydro Potential of 15000 MW upto the capacity of 25 MW. A database has been created for most potential sites by collecting information from various sources and the State Governments. Rajeev Gandhi Grameen Vidyutikaran Yojana (RGGVY) sets the context of Decentralised distributed generation and distribution as a major instrument of remote rural electrification. 3.2.4 Thermal Generation Coal would necessarily continue to remain the primary fuel for meeting future electricity demand. Imported coal based thermal power stations, particularly at coastal locations, would be encouraged based on their economic viability. Use of low ash content coal would also help in reducing the problem of fly ash emissions. Significant Lignite resources in the country are located in Tamil Nadu, Gujarat and Rajasthan. Lignite mining technology needs to be improved to reduce costs. Use of gas as a fuel for power generation would depend upon its availability at reasonable prices. Natural gas is being used in Gas Turbine /Combined Cycle Gas Turbine (GT/CCGT) stations, which currently accounts for about 10 per cent of total capacity. Power sector consumes about 40per cent of the total gas in the country. New power generation capacity could come up based on indigenous gas findings, which can emerge as a major source of power generation if prices are reasonable. A national gas grid covering various parts of the country could facilitate development of such capacities. Imported LNG based power plants are also a potential source of electricity and the pace of their development would depend on their commercial viability. The existing power plants using liquid fuels could shift to use of Natural Gas/LNG at the earliest to reduce the cost of generation. For thermal power, economics of generation and supply of electricity should be the basis for choice of fuel from among the options available. It would be economical for new generating stations to be located either near the fuel sources e.g. pithead locations or load centres. 3.2.5 Nuclear Power Nuclear power is an established source of energy to meet base load demand. Nuclear power plants are being set up at locations away from coalmines. Share of nuclear power in the overall capacity profile will need to be increased significantly. Economics of generation and resultant tariff will be, among others, important considerations. Public sector investments to create nuclear generation capacity will need to be stepped up. Private sector partnership would also be facilitated to see that not only targets are achieved but exceeded. Nuclear Power Capacity Addition Plan: Nuclear power is seeing a renaissance. Power-starved India, which has the largest number of reactors under construction, is at the forefront of this revival of interest in nuclear power. India is building seven of the 30 reactors under construction around the world. This is likely to increase

10

significantly once the India-US agreement on nuclear cooperation is accepted by the rest of the world. The NPCIL and the Bharatiya Nabhikiya Vidyut Nigam Ltd (Bhavini) are the only companies authorised to build nuclear reactors in the country. India plans to increase nuclear generation capacity at least fivefold to 20,000 Mw by 2020. 3.2.6 Captive Generation The liberal provision in the Electricity Act, 2003 with respect to setting up of captive power plant has been made with a view to not only securing reliable, quality and cost effective power but also to facilitate creation of employment opportunities through speedy and efficient growth of industry. The provision relating to captive power plants to be set up by group of consumers is primarily aimed at enabling small and medium industries or other consumers that may not individually be in a position to set up plant of optimal size in a cost effective manner. It needs to be noted that efficient expansion of small and medium industries across the country would lead to creation of enormous employment opportunities. A large number of captive and standby generating stations in India have surplus capacity that could be supplied to the grid continuously or during certain time periods. These plants offer a sizeable and potentially competitive capacity that could be harnessed for meeting demand for power. Under the Act, captive generators have access to licensees and would get access to consumers who are allowed open access. Grid inter-connections for captive generators shall be facilitated as per section 30 of the Act. This should be done on priority basis to enable captive generation to become available as distributed generation along the grid. Towards this end, non-conventional energy sources including co-generation could also play a role. Appropriate commercial arrangements would need to be instituted between licensees and the captive generators for harnessing of spare capacity energy from captive power plants. The appropriate Regulatory Commission shall exercise regulatory oversight on such commercial arrangements between captive generators and licensees and determine tariffs when a licensee is the off-taker of power from captive plant 4.0 REGULATORY ENVIRONMENT 4.1 Institutional Framework The Ministry of Power is primarily responsible for the development of the Indian power sector. It is concerned with perspective planning and policy formulation in the sector. The State Electricity Boards (SEBs) generate, transmit and distribute electricity in coordination with private/centrally owned generating companies or any other relevant agency. The Central Electricity Authority (CEA) is a body constituted under the Electricity Supply Act, which is responsible for developing a sound, adequate, and uniform policy for the control and utilisation of national power resources. It is also responsible for the technoeconomic appraisal of the project reports for the proposed power

11

plants, including those in the private sector. Subsequent to enactment of the Legislation on establishment of a regulatory authority, an institution called the Central Electricity Regulatory Commission (CERC) has been set up for rationalisation of bulk and retail tariff for generation and transmission utilities involved in inter-state operations. It also regulates at intra-state level. Each state has set up a State Electricity Regulatory Commission. There are a number of orporations under GOI to develop and operate power stations which include NTPC, NHPC, NEEPCO etc. REC, a GOI company has been established with an objective to assist the SEBs in the development & programmes of rural electrification. PGCIL, under GOI establishes & maintains HV transmission system and regional load despatch centres. PFC assists the various EBs & other organisations in the power sector. Professional organisations like CPRI, NPTI, Energy Management Centre, Council of Power Utility etc. provide assistance with their expertise Power generation on the nuclear side is handled by Department of Atomic Energy, GOI. 4.2 The Indian Electricity Act, 1910 Provided basic framework for electric supply industry in India. Growth of the sector through licensees. License by State Govt. Provision for license for supply of electricity in a specified area. Legal framework for laying down of wires and other works. Provisions laying down relationship between licensee and consumer. 4.3 The Electricity (Supply) Act, 1948 Mandated creation of SEBs. Need for the State to step in (through SEBs) to extend electrification (so far limited to cities) across the country. 4.3.1 Main amendments to the Indian Electricity Supply Act Amendment in 1975 to enable generation in Central sector. Amendment in 1991 to open generation to private sector. Amendment in 1998 to provide for private sector participation in transmission, and also provision relating to Transmission Utilities. 4.4 The Electricity Regulatory Commission Act, 1998 Provision for setting up of Central / State Electricity Regulatory Commission with powers to determine tariffs. Constitution of SERC optional for States. Distancing of Government from tariff determination. 4.5 Energy Conservation Act, 2001

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The Act primarily ensures energy efficiency in consumption & consequently Demand Side Management (DSM) for reducing need for installing new capacity. Bureau of Energy Efficiency (BEE) has been set up on 1st March, 2002 for formulating norms for processes, consumption standards, testing, certification and labeling procedures etc. 4.6 The Electricity Act 2003 The Electricity Act 2003 has been enacted by the Parliament in June, 2003. It is a comprehensive legislation replacing Electricity Act 1910, Electricity Supply Act 1948 and Electricity Regulatory Commission Act 1998. The salient positive features of this legislation are: Removal of a number of restrictive barriers to the flow of power in a competitive market scenario by opening access to transmission and distribution. Freeing up of generation and captive power plants from licenses and techno-economic approvals. The recognition to trading as a distinct activity that would help ushering in a market environment. The formation of an expert Appellate Tribunal to hear appeals against State and Central Electricity Regulatory Commission orders. Transferring the full range of regulatory and licensing functions to the Central and State Regulatory Commissions. Deregulating tariffs in certain situations e.g. in case of agreements between consumers and generating companies. The distancing of Government from the functioning of the sector after giving broad directions via the National Electricity Policy and the National Tariff Policy. The conversion of the remaining State Electricity Boards into State Transmission Utilities and deemed licensees with the freedom (but not compulsion) to restructure and progress down the road to corporatisation and privatization. 4.7 Reforms So Far 26 states have signed Memorandum of Understanding (MoU) with the Government of India to undertake reforms. 20 states have constituted State Electricity Regulatory Commissions and are functional. Tripura and Jharkhand have notified the constitution of SERC. 18 State Electricity Regulatory Commissions have issued tariff orders. 11 States have unbundled/corporatised. State of Orissa and Delhi have privatized distribution of electricity. 4.8 Major Policies Notified Under the Electricity Act During 2006 4.8.1 Tariff Policy

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The Tariff Policy has been notified by Government of India on 6 January, 2006 under the provisions of section 3 of the Electricity Act, 2003. The objectives of the tariff policy are to: Ensure availability of electricity to consumers at reasonable and Competitive rates Ensure financial viability of the sector and attract investments Promote transparency, consistency and predictability in regulatory approaches across jurisdictions and minimise perceptions of regulatory risks Promote competition, efficiency in operations and improvement in quality of supply. 4.8.2 Guidelines for procurement of electricity In compliance with section 63 of the Electricity Act, 2003, the Central Government had notified guidelines for procurement of power by Distribution Licensees through competitive bidding. Central Government has also issued the standard bid documents containing RFQ, RFP and model PPA for long term procurement of power from projects having specified site and location. Amendment to these guidelines has been issued on 30 March, 2006 and 18 August, 2006. 4.8.3 Rural Electrification Policy Rural Electrification Policy, in compliance with section 4 and 5 of the Electricity Act 2003, was notified on 23 rd August, 2006. Overall approach enunciated in the Policy highlights grid connectivity to be normal way of electrification of villages. For villages / habitations where grid connectivity is not feasible or not cost effective of grid solutions based on stand-alone systems may be taken up. De-centralized distribution generation facilities together with local distribution network may be based on either conventional or non-conventional method of electricity generation. The State Governments should within six months prepare and notify a Rural Electricity Plan to achieve the goal of providing access to all households. 4.8.4 New Hydro-Policy Section 63 of the Electricity Act provides for development of projects on the basis of competitive bidding for tariff. Sections 61 and 62 allow such projects developed on the basis of tariff to be fixed by the Regulator on the basis of capital cost and norms. In fact, the Electricity Tariff Policy notified in January 2006 also allows a special dispensation for project development by State and Central PSUs on the basis of capital cost and norm based tariff to be determined by the Regulatory Commission. This dispensation, allowed for PSUs, is now proposed to be made available for the same period of 5 years to promote hydro-power development even through the private sector route. The State would be required to follow a transparent process for selection of the developer. This arrangement would have several advantages. While the initiative for allocation of the project would remain with the State Government (subject to the requirement of transparency in the allocation), the

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scrutiny of the regulator and the CEA would ensure that the project is being designed and built in the most optimal and economic manner, and that the interest of the consumers is adequately protected. From the point of view of the developer, this procedure would reduce numerous risks associated with the construction and operation and maintenance (O&M) of hydro projects. New Hydel Policy announced with an objective of making investment in hydro projects more attractive. The government has prepared plan for creation of National Grid by 2012 and infrastructure to facilitate inter-regional exchange of 30,000 MW of electricity by 2012. 4.8.5 Ultra-Mega Power Projects (UMPPs) The Ministry of Power, Government of India has launched an initiative for development of coal-based Ultra-Mega Power Projects (UMPPs) in India, each with a capacity of 4,000 MW or above. These projects will be awarded to developers on the basis of tariff based competitive bidding. To facilitate tie-ups of inputs and clearances, project-specific shell companies have been set up as wholly owned subsidiaries of the Power Finance Corporation (PFC) Ltd. These companies will undertake preliminary studies and obtain necessary clearances including water, land, fuel, power selling tie-up etc. prior to award of the project to the successful bidder. Nine sites have been identified by CEA in nine States for the proposed UMPPs. These include four pithead sites, one each in Chhattisgarh, Jharkhand, Madhya Pradesh and Orissa, and five coastal sites, one each in Andhra Pradesh, Gujarat, Karnataka, Maharashtra and Tamil Nadu. It is proposed to set up pithead projects as integrated proposals with corresponding captive coal mines. For the coastal projects, imported coal shall be used. The projects are to be developed with a view to lower the cost of power to the consumers. These projects, adopting supercritical technology to reduce emissions, would be environment-friendly. 4.8.6 Development of Merchant Power Plants To facilitate the development of the electricity market, the Ministry of Power has issued the approach and guidelines on development of merchant power plants (MPPs). MPPs can provide the additional generating reserves that India needs now and will need in the future. They are a modern, market-based answer at least in part to the energy challenges faced by the country. MPPs are a product of the restructuring of the electricity industry and they fill different niches in the market; some provide steady supplies to a power grid, while others fire up only when demand is at the highest and meet peak loads. Merchant power plants operating competitively help assure that power is produced with efficiency and supplied to locations where it is needed most. MPPs up to a capacity of 1,000 MW would be provided coal linkage, and captive coal blocks may also be provided to merchant power plants in the range of 5001000 MW.

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4.8.7 Private Participation in Transmission Private investment has been allowed in power transmission either through 100% equity or joint venture with PGCIL. In case of latter, the PGCIL will hold only 26% stake and private party would hold the rest. Private sector participation in transmission had been limited to construction and maintenance of transmission lines on BOOT (buildown-operate-transfer) basis under the control of PGCIL. Policy initiatives for encouraging competition in development of transmission projects Promote competitive procurement of transmission services. Encourage private investment in transmission lines. Facilitate transparency and fairness in procurement processes. Facilitate reduction of information asymmetries for various bidders. Protect consumer interests by facilitating competitive conditions in procurement of transmission services of electricity. Enhance standardization and reduce ambiguity and hence time for materialization of projects. Ensure compliance with standards, norms and codes for transmission lines while allowing flexibility in operation to the transmission service providers. 4.8.8 Development of Transmission Projects through Competitive Bidding An Empowered Committee identifies projects to be developed through competitive bidding route. Power Finance Corporation and Rural Electrification Corporation have been identified as nodal agency for this initiative. 4.8.9 Rural Electrification: Rajiv Gandhi Grameen Vidyutikaran Yojna (RGGVY) This scheme of Rural Electricity Infrastructure and Household Electrification was introduced in April, 2005 for achieving the NCMP objective of providing access to electricity to all rural households over a period of four years. REC is the nodal agency for the programme. The services of CPSUs have been offered to the State for assisting them in the execution of rural electrification projects as per their willingness and requirement. The management of rural distribution has been envisaged through franchisees to non-governmental organizations (NGOs), users associations, cooperatives or individual entrepreneurs. Panchayat institutions would be associated with the management 4.8.10 Accelerated Power development and reforms Programme (APDRP) The Accelerated Power Development Reforms Programme (APDRP) was launched in 2002-03 for implementation in the 10th Plan as additional central assistance to the states for strengthening and up gradation of sub-transmission and distribution systems of high-density load Centres like towns and industrial areas.

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The main objectives of the programme were to reduce AT&C loss and to improve quality and reliability of supply. 5.0 Planned Development in Transmission 5.1 Isolated Systems At the time of Independence, power systems in the country were essentially isolated systems developed in and around urban and industrial areas. The highest transmission voltage at the time was 132 kV. The frame work for development of power sector was set with the enactment of Electricity (Supply) Act, 1948 providing for establishment of CEA for coordinated development of Power Sector and was made responsible for formulating plans for power development and coordinating the activities of the planning agencies in relation to the control and utilization of national power resources. The Act also provided for formation of State Electricity Boards (SEBs) in the States. The SEBs were responsible for development of generation, transmission, distribution and utilization of Electricity in their respective States. The objective of development was to have a coordinated process towards integrated system. 5.2 State Grid Systems Thus started the process of development of transmission and distribution system for extension of benefits of electricity to semi-urban and rural areas. The systems around urban and industrial areas grew into full fledged State Grid systems. In 1964, for the purpose of coordinated power sector planning on a larger scale and integration of State Grid systems towards optimum development and utilization of resources, the country was demarcated in to five Regions viz. the Eastern Region, the North Eastern Region, the Northern Region, the Western Region and the Southern Region, and the Regional Electricity Boards were established in each of the regions for facilitating integrated operation of state systems and encouraging exchange of power among the states. For the purpose, inter-state lines were planned which were treated as Centrally sponsored schemes. 5.3 Regional Grid Systems In 1975, Central Sector generation utilities viz. NHPC and NTPC were created to supplement the efforts of the states in regard to generation capacity. These Corporations established large regional generating stations, the benefits of which were shared by the states of the region. The construction of associated transmission system for evacuation of power as well as delivery of power to the constituent states was also entrusted to these corporations. With this, the focus of planning and development in the transmission system shifted from State Grid system to Regional Grid system. As a result, regional networks were formed and by the end of 1980's strong regional networks came into existence. 5.4 Inter Regional Links In 1989, the transmission wings of these Central Generating companies were separated to set up Power Grid Corporation of India

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(POWERGRID) to give thrust to implementation of transmission system associated with Central generating stations and intra-Regional transmission programme based on perspective planning done by CEA. A few inter-regional links were also planned and developed to facilitate exchange among the various regions. However, these inter-regional links were planned for emergency assistance and transfer of operational surplus between the regions in a limited manner only. The operational mechanism including resource planning as well as grid operation and consequently the operational frequencies of various regions continued to be Region specific. Hence, as the operational frequencies of the regions were different, the power exchanges through AC lines could take place only in a limited manner through radial mode operation. To facilitate interregional exchanges between asynchronously operating regional grids, HVDC back-to-back links were developed. This included 500 MW link between Northern and Western Region at Vindhyachal, 1000 MW Western and Southern Region link at Bhadravati and 500 MW between Eastern and Southern Region link at Gazuwaka. By the end of the century, inter-regional capacity of 3850 MW, consisting of 2000 MW of HVDC back-to-back and 1850 MW of radial mode AC lines of 220 kV existed in the country. 5.5 National Grid System Since the advent of the current century, the focus of planning the generation and the transmission system in the country has shifted from the orientation of regional self-sufficiency to the concept of optimization of utilization of resources on All India basis. Generation planning studies carried out by CEA had indicated that capacity addition of 100 GW planned on all India basis was equivalent to addition of 113 GW planned on regional basis. The resulting saving in investment in generation was much more than the incremental investment in transmission to provide a strong National Grid system which would enable such an all-India generation planning and development. The advantages of National grid system were known much earlier. In fact the vision towards the development was already foreseen by the founders of our country who had mandated the same in the Electricity (Supply) Act 1948 itself. However, as every level in a hierarchical system derives its strength from the layer beneath, the National Grid system had to wait till emergence of strong Regional systems. Nevertheless, the change in planning philosophy towards National system has started showing the development on the ground. In just about 4-5 years since the beginning of the new era, the inter-regional capacity had more than tripled. 5.6 New Technologies Development of the transmission network has been done in tandem with growth in generation capacity. The growth in transmission system is characterized by the physical growth in transmission network as well as introduction of higher transmission voltages and new technologies for bulk power transmission. Landmark of this growth had been introduction of 220 kV in 1960, 400 kV in 1977, HVDC back-to-back link

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in 1989, +/-500kV, HVDC bi-pole line in 1990, 765 kV transmission line (initially charged at 400 kV) in 2000 (at 765kV) in 2007 and +/-600kV, 4000 MW HVDC bi-pole line in 2011. 6 Programme of Development of National Grid 6.1 Formation of the National Grid Power Grid is now working on the planned set up of a national power grid to facilitate transfer of power within the different regions in India by the end of the eleventh 5-year Plan. This grid will support the interregional energy transfer and will exploit the countrys unevenly distributed energy resources. The national grid will also help the powerdeficit regions to fulfill their demand from the regions that have excess power. The Power Grid has achieved several milestones towards the development of National Grid such as the implementation of Asias longest Talcher-Kolar High Voltage Double Circuit (HVDC) bipole link including its upgradation and the commissioning of MuzaffarpurGorakhpur high capacity 400 KV D/C that interconnects all four regional grids (Northern, Western, Eastern and North-Eastern) and is operating as a synchronous grid. The difficulty encountered during the construction of the transmission lines was the Right of Way (ROW), especially in the hilly terrains of the Northern and North-Eastern regions, which are endowed with hydro resources. Transmission Super Highways are the solution for the ROWs so that they do not cause bottlenecks in harnessing generating resources. Interconnection of these highways from different parts of the country will ultimately lead to formation of a high-capacity national power grid. The objectives underlying the formation of National Grid are:

To transfer power from surplus regions to deficit regions Utilise maximum resources from diversified regions Ensure reliable, economical and quality power

As on today, the inter-regional transmission capacity of 22,400 MW is existing and inter-regional energy exchanges of more than 12 billion kWh in a year thus contributing to greater utilization of generation capacity. 6.2 Evacuation of surplus power from Eastern Region Eastern Region at present is having substantial energy surplus. While the formation of National Grid is an ultimate solution to remove interregional imbalance, several schemes have been completed on priority basis to facilitate power transfer from surplus Eastern Region to other deficit Regions. A task force under the Chairmanship of Special Secretary (Power) has been constituted by Ministry of Power to

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formulate a short-term action plan for evacuation of surplus power from Eastern Region. 6.3 Future Programme Looking into the future demand and availability of generation resources, a Perspective Transmission Plan has been drawn up indicating the major inter-regional transmission highways to be developed by 201112. This will ultimately lead to the formation of a strong National Grid. These highways are proposed to be established in phases matching with the requirement of inter-regional power transfer. Four major power regions of the country namely, North-Eastern, Eastern, Western and Northern are now operating as one synchronous grid (same frequency). Southern Regional grid is connected to this synchronous grid through HVDC links. Establishment of the ultimate National Grid is on fast track and a number of projects are under implementation/ planned which would enhance Inter-regional power transfer capacity of the National Grid to more than 37,000 MW by year 2012. As per the envisaged programme, cumulative capacity of the interregional links will be enhanced as shown.

A total of 20700 MW of new inter-regional links have been planned for the 11th Five Year Plan (2007-12). Thus total inter-regional transmission capacity of National Power Grid is foreseen to be 37150 MW by 2011-12. Details of inter-regional links planned for 11th Plan, are given below:

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7 Control Centres 7.1 Introduction Bulk electric power systems comprise of hundreds of generating units interconnected by an intricate web of transmission & distribution spread across vast geographical stretches. These systems are dynamic in nature by virtue of their inherent characteristics and continuous exposure to human, environmental and other physical influences. Providing a reliable supply of electricity is an enormously complex technical challenge, even in most routine of days. It is said that the power supply to the consumers is the ultimate just-in-time manufacturing...Capable of moving at almost the speed of light, the product is delivered to the customers fresh, within milliseconds of being manufactured by the generators...The customers are in complete control of the amount of product they use...They never get placed on hold...So the generators must continually match the load, even though daily fluctuations in demand of more than 100 percent are not uncommon... .

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For ensuring a reliable and quality supply to the consumers, the power system must be operated within the prescribed reliability standards. This is achieved through extensive off-line as well as real-time coordination between thousands of personnel in-charge of various activities of the electricity supply chain viz. generation, transmission and distribution. The system operators positioned at well-equipped control centres provide the coordination services that are vital for operating the system within the operating limits. 7.2 Load Despatch centers in India The control of the grid is planned to be done at 3 levels of hierarchy namely NLDC, RLDC and SLDC. Each level of hierarchy has definite roles and responsibilities as listed below. North-Eastern, Eastern, Western and Northern regional load despatch centres are now operating under the NLDC. The ALDCs in turn form a lower level and are local control centres which operate the power network of a part of the state. The RTU is a source of information collection for the purpose of control and operation of the grid. Every RTU has a predefined Master control centre (CC) and it has to report its data to the CC. An RTU may be connected to ALDC, SLDC or RLDC depending on whose data RTU is reporting. For example all RTUs connected to ISGS report directly to RLDC, whereas RTUs connected to state owned generations report to corresponding SLDC. However irrespective of the master CC, all RTUs ultimately report to the RLDC, through flow of aggregated data between the control centres. 7.3 Role of NLDC When PGCIL was formed then the responsibility of Regional Load Despatch Centres (RLDCs) was handed over to POWERGRID by Central Electricity Authority(CEA). National Load Despatch Centre (NLDC) has been constituted as per Ministry of Power (MOP) notification ,New Delhi dated 2nd March 2005 and is the apex body to ensure integrated operation of the national power system. On 25th February,2009 the National Load Despatch Center(NLDC) was inaugurated. Now these Regional Load Despatch Centres(RLDCs) and National Load Despatch Center(NLDC) is a separate Organisation named POSOCO (Power system Operation Corporation), a wholly owned subsidiary of POWERGRID. The main functions assigned to NLDC are as follows: (a) supervision over the RLDCs. (b) scheduling and despatch of electricity over inter-regional links in coordination with RLDCs. (c) coordination with RLDCs for achieving maximum economy and efficiency in the operation of National Grid. (d) monitoring of operations and grid security of the National Grid. (e) supervision and control over the inter-regional links as shall be required for ensuring stability of the power system under its control. (f) coordination with RPCs for regional outage schedule in the national perspective to ensure optimal utilization of power resources.

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(g) coordination with RLDCs for the energy accounting of inter-regional exchange of power. (h) coordination for restoration of synchronous operation of national grid with RLDCs. (i) coordination for trans-national exchange of power. (j) providing operational feed back for national grid planning to the Authority and the CTU. (k) levy and collection of such fee and charges from the generating companies or licensees involved in the power system, as shall be specified by the Central Commission. (l) dissemination of information relating to operations of transmission system in accordance with directions or regulations issued CERC and the Central Government from time to time. 7.4 Role of RLDC 7.4.1 The responsibilities of RLDCs are as follows: (1) The RLDC shall be the apex body to ensure integrated operation of the power system in the concerned region. (2) It shall comply with the principles, guidelines and methodologies in respect of wheeling and optimum scheduling and despatch of electricity as may be specified in the Grid Code. (3) It shall(a) be responsible for optimum scheduling and despatch of electricity within the region, in accordance with the contracts entered into with the licensees or the generating companies operating in the region; (b) monitor grid operations; (c) keep accounts of quantity of electricity transmitted through the regional grid; (d) exercise supervision and control over the Inter-State transmission system ; and (e) be responsible for carrying out real time operations for grid control and despatch of electricity within the region through secure and economic operation of the regional grid. (4) It may give such directions and exercise supervision and control as may be required for ensuring stability of grid operations and for achieving the maximum economy and efficiency in the operation of the power system in the region under its control. (5) Every licensee, generating company, generating station, substation and any other person connected with the operation of the power system shall comply with the directions issued by the RLDCs. (6) All directions issued by them to any transmission licensee of State transmission lines or any other licensee of the State or generating company (other than those connected to inter-State transmission system) or substation in the State shall be issued through the SLDC and the SLDC shall ensure that such directions are duly complied with by the licensee or generating company or substation. (7) If any dispute arises with reference to the quality of electricity or safe, secure and integrated operation of the regional grid or in

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relation to any direction given by the RLDC, it shall be referred to Central Commission for decision. However, pending the decision of the Central Commission, the directions of the RLDC, shall be complied with by the SLDC or the licensee or the generating company, as the case may be. 7.4.2 The following are contemplated as exclusive functions of RLDCs (a) System operation and control including inter-state / interregional transfer of power, covering contingency analysis and operational planning on real time basis; (b) Scheduling / re-scheduling of generation; (c) System restoration following grid disturbances; (d) Metering and data collection; (e) Compiling and furnishing data pertaining to system operation; (f) Operation of regional UI pool account, regional reactive energy account and Congestion Charge Account, provided that such functions will be undertaken by any entity(ies) other than RLDCs if CERC so directs. (g) Operation of ancillary services 7.5 Role of SLDC 7.5.1 The State Load Despatch Centre (SLDC) shall have following functions: (1) It shall be the apex body to ensure integrated operation of the power system in a State. (2) It shall (a) be responsible for optimum scheduling and dispatch of electricity within a State, in accordance with the contracts entered into with the licensees or the generating companies operating in that State; (b) monitor grid operations; (c) keep accounts of the quantity of electricity transmitted through the State grid; (d) exercise supervision and control over the intra-State transmission system; and (e) be responsible for carrying out real time operations for grid control and despatch of electricity within the State through secure and economic operation of the State grid. (3) The SLDC in a State may give such directions and exercise such supervision and control as may be required for ensuring the integrated grid operations and for achieving the maximum economy and efficiency in the operation of power system in that State. Every licensee, generating company, generating station, sub-station and any other person connected with the operation of the power system shall comply with the directions issued by the SLDC. (4) It shall comply with the directions of the RLDC. 8 PLANNING CODE FOR INTER-STATE TRANSMISSION

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8.1 Introduction Development of an efficient, co-ordinated and economical system for smooth flow of electricity from generating stations to the load centres and reliable operation in real-time requires meticulous planning in various time horizons viz. long-term, mid-term, short-term and real-time. In India the Central Electricity Authority (CEA), Government of India and the Central Transmission Utility (CTU) in coordination with the State Transmission Utility (STU) are responsible for long term planning (for network expansion) in an integrated manner. Operational planning in the other time horizons and operation in real time is taken care of by the Regional Load Dispatch Centres and the State Load Despatch Centres. The Indian Electricity Grid Code (IEGC) lays down the rules, guidelines and standards to be followed by the various agencies and participants in the system to plan, develop, maintain and operate the power system, in the most efficient, reliable, economic and secure manner, while facilitating healthy competition in the generation and supply of electricity. The Central Transmission Utility (CTU) shall i) discharge all functions of planning and co-ordination relating to inter-State transmission system in coordination with STU, Central Government, State Governments, Generating Companies, RPCs, Central Electricity Authority (CEA), licensees and any other person notified by the Central Government in this behalf. ii) provide non-discriminatory open access to its transmission system for use by (a) any licensee or generating company on payment of the transmission charges; or (b) any consumer as and when such open access is provided by the State Commission Similarly, the State Transmission Utilities (STUs) shall i) discharge all functions of planning and coordination relating to intra-State transmission system with CTU, State Governments, Generating Companies, RPCs, Central Electricity Authority (CEA), licensees and any other person notified by the State Government in this behalf. ii) provide non-discriminatory open access to its transmission system for use by (a) any licensee or generating company on payment of the transmission charges; or (b) any consumer as and when such open access is provided by the State. The transmission licensee shall provide non-discriminatory open access to its transmission system for use by (a) any licensee or generating company on payment of the transmission charges; or (b) any consumer as and when such open access is provided by the State Commission .

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The CEA shall prepare a National Electricity Plan in accordance with the National Electricity Policy and notify such plan once in five (5) years. CEA may review or revise the National Electricity Plan in accordance with the National Electricity Policy. CEA is responsible to advise the Central Government on the matters relating to the National Electricity Policy, formulate short-term and perspective plans for development of the electricity system and co-ordinate the activities of planning agencies for optimal utilization of resources to subserve the interests of the national economy and to provide reliable and affordable electricity for all consumers. 8.2 Objective The objectives of Planning Code are as follows: (a) To specify the principles, procedures and criteria which shall be used in the planning and development of the ISTS and inter regional links. (b) To promote co-ordination amongst all users, STU/SLDC and CTU/RLDC and NLDC in any proposed development of the ISTS. (c) To provide methodology and information exchange amongst users, STU/SLDC and CTU/RLDC and NLDC in the planning and development of the ISTS. 8.3 Scope The Planning Code applies to CTU, other Transmission licensees, Inter- State Generating Station (ISGS), connected to and/or using and involved in developing the ISTS. This Planning Code also applies to Generating Companies, IPPs, SEBs/STUs and /licensees, regarding generation and/or transmission of energy to/from the ISTS. 8.4 Planning Philosophy (a) CEA would formulate perspective transmission plan for inter-State transmission system as well as intra-State transmission system. These perspective transmission plans would be continuously updated to take care of the revisions in load projections and generation scenarios considering the seasonal and the time of the day variations. (b) The CTU shall carry out planning process from time to time as per the requirement for identification of major inter-State transmission system including inter-regional schemes which shall fit in with the perspective plan developed by CEA. While planning schemes, the following shall be considered in addition to the data of authenticated nature collected from and in consultation with users by CTU: i) Perspective plan formulated by CEA. ii) Electric Power Survey of India published by the CEA. iii) Transmission Planning Criteria and guidelines issued by the CEA iv) Operational feedback from NLDC

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(c) Addition in transmission system shall be planned in accordance with the CERC ( Grant of Connectivity, Long-term Access and Medium-term Open Access in inter-state Transmission and related matters) Regulations. (d) In addition to the major inter-State transmission system, the CTU shall plan, from time to time, system strengthening schemes, need of which may arise to overcome the constraints in power transfer and to improve the overall performance of the grid. (e) All , STUs and users will supply to the CTU, the desired planning data from time to time to enable to formulate and finalize its plan. (f) As voltage management plays an important role in inter-state transmission of energy, special attention shall be accorded, by CTU, for planning of capacitors, reactors, SVC and Flexible Alternating Current Transmission Systems (FACTS), etc. Similar exercise shall be done by STU for intra-State transmission system to optimize the utilistion of the integrated transmission network. (g) Based on Plans prepared by the CTU, State Transmission Utilities (STU) shall have to plan their systems to further evacuate power from the ISTS and to optimize the use of integrated transmission network. (h) In case Long Term Access Applications require any strengthening in the intra-State transmission system to absorb/evacuate power beyond ISTS, the applicant shall coordinate with the concerned STU.STU shall augment the intra-state transmission system in a reasonable time to facilitate the interchange of such power. (i) The Inter-State Transmission System and associated intra-State transmission system are complementary and inter-dependent and planning of one affects the other's planning and performance. Therefore, the associated intra-State transmission system shall also be discussed and reviewed before implementation during the discussion for finalizing ISTS proposal. 8.5 Planning Data Under the Planning Code, the Regional entities, STUs, State Generating Companies, IPPs, licensees are required to supply two types of data: i) Standard planning data ii) Detailed planning data Standard Planning data Standard planning data consists of details which are expected to be normally sufficient for the CTU to investigate the impact on the ISTS due to user development. Standard Planning data covering the following should be furnished by the Users/STU. (a) preliminary project planning data (b) committed project planning data, and (c) connected planning data

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This data shall be furnished to CTU from time to time in the standard formats supplied by the CTU. The CTU shall compile these data received from users/STUs and put the same on its web-site. Detailed Planning data Detailed planning data consist of additional, more detailed data not normally expected to be required by CTU to assess the impact of User development on the ISTS. This data shall be furnished by the Users of ISTS as and when requested by CTU. 8.6 Implementation of Transmission Plan The actual program of implementation of transmission lines, Interconnecting Transformers, reactors/capacitors and other transmission elements will be determined by CTU in consultation with the concerned users and STUs. The completion of these works, in the required time frame, shall be ensured by CTU through the concerned persons 9 Conclusion The formation of the NEW grid has taken us from regional grid operation to national grid operation. While on one hand this would enable regional grids to reap the all the benefits associated with synchronous interconnection, on the other hand they have to handle the inherent risks of a Large Grid. There has been a paradigm shift in grid operation since the formation of the NEW grid. Now greater emphasis needs to be given on network reliability, protection systems, grid discipline and handling emergencies. Operating such a large grid in a reliable manner is an onerous task, which can be discharged only with the technical solidarity and co-operation of all stakeholders. The experience so far in operating the combined Northern and Central grid in synchronism has so far been positive. All the regions have been able to reap the benefits of synchronous operation. Grid discipline however continues to be a major area of concern and the SLDCs need to focus on this area in right earnest notwithstanding the compulsions to meet a high power demand even under a deficit situation. All the stakeholders also need to give a renewed thrust to network reliability.

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TABLE OF CONTENTS No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Introduction VLPGO Secretariat VLPGO and its values VLPGO focus Objective of VLPGO VLPGO: leading the transition to the Grid of the 21 st century Facing challenges of smarter energy COP 17 How do we relate internationally to other grid operators world wide US utilities ENTSO-E TSO-Comparison group Members Benchmarking model CIGRE Study Committee-C2 Study Committee-C5 Scope of System Operation Activities Topic

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VERY LARGE POWER GRID OPERATORS

1.0 Introduction VLPGO is a voluntary initiative of the worlds largest Power Grid Operators, representing together more than 60% of the electricity demand in the world. VLPGO was created in 2004, following several blackouts across the world, to investigate fundamental issues of common interest to its Members and to develop joint action plans addressing the improvement of power system security. In 2009, VLPGO became a formal organization, with the aim of serving as leader and catalyst in the transition of the electric power industry to the power grids of the 21st century. 2.0 VLPGO Secretariat is situated in the following address: Email (Primary): secretariat@vlpgo.org Email (Secondary): alain.steven@vlpgo.org Phone: (+1) 610-745-7341 Phone: (+1) 484-534-3836 Address: 2502 Creekside Drive, Lansdale, PA 19446, USA Vision To be a leader and a catalyst in the transition of the electric power industry to the power grid of the 21st century Mission Develop an international consensus on strategic issues which are unique to the very large power grid and market operators Develop a common vision with respect to the technologies and best practices required to address those issues Facilitate the implementation of the vision through information exchanges, collaborative projects and cooperation with other international organizations. Indian Power System : Amongst the Largest in the World

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3.0 3.1

VLPGO Data VLPGO delivers value to it members through: Emerging Technology Identify early trends Assess common impacts Develop common solution requirements Shared Learning Identify common key operational risks Share after-the-fact analysis of major events Common Approaches & Solutions

3.2

3.3

Develop common specifications across suppliers Create new market mechanisms Produce guidelines for common reliability issues

3.4

Best Practices Share best Ideas and policies Create methodologies for evaluation or analysis Industry Influence Develop common positions for industry stakeholders VLPGO focuses on: Identifying and developing Emerging Technology Determining Common Approaches & Solutions Evaluating the Best Practices Sharing Learning Developing Industry Influence

3.5 4.0

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5.0

The Objectives of VLPGO: The Transition to Grid of the 21st Century will be achieved through the following 3 objectives: Innovate Thinking An international consensus on strategic issues challenging the very large power grid and market operators Technology Advancement A common vision with respect to the technologies and best practices required to address those issues in a framework of social and environmental responsibility of each member. Industry Leadership Through a common Communication Policy, the dissemination and implementation of a common vision through information exchange, collaborative projects and cooperation with other international organizations.

6.0

VLPGO is leading the Transition to Grid of the 21st Century At the VLPGO 2009AnnualMeeting, held recently in Washington D.C., the VLPGO Steering Board agreed on a set of common actions to be conducted in the context of agreed upon worldwide strategic themes for the power grids. These include: enhanced security and system restoration practices; advanced power grid monitoring and control systems; integration of renewable energy sources into power grids; increased use of HVDC links in synchronous power systems; electricity storage including the integration of Plug-in Hybrid Electric Vehicles (PHEVs) into the power grid. Electricity and the Consumer Electricity is considered the most significant contribution to human progress in the last century because it allows any source of primary energy (wind, solar, biomass, hydro, fossil, nuclear, etc.) to be converted into a form that can be transmitted in an efficient way to end users. The role of electricity will continue to be one of crucial importance, but how it is generated and delivered will change rapidly over the next few decades. As energy efficiency and smart grid technologies are adopted, consumers will have more choices on how they use electricity, while the transport of electricity will be more secure. Supplying the Worlds Electricity Power grids, and the continuous development of their supporting infrastructure, play an essential role in promoting the social welfare of populations around the world. The reliable and safe supply of energy is the responsibility of the Power grid operators (PGOs). In this framework the main objective of grid operators is to ensure the needs of consumers are met ;and, the main mission of the PGOs is

6.1

6.2

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to maintain high standards for power supply quality and reliability at minimum costs. The PGOs work constantly to plan, monitor, supervise and control the energy they deliver as a continuous process 24 hours a day. In delivering the electricity that powers modern societies, the PGOs recognise their critical role, which includes: acting on behalf of Consumers, to ensure quality while minimizing costs and recognizing economic and societal dependence on electricity; a technical role in planning, designing, and managing the Power Systems; an interface role with generators, market participants and distributors, which are the most direct users of the transmission grid; a natural role of interlocutors with power exchanges, regulators and governments. 7.0 Facing the Challenges of Smarter Energy PGOs are continuously developing their operations to incorporate technical advances and societal concerns. Specifically, PGOs are increasing their ability to integrate smart grid technologies, facilitating alternative and renewable power generation technologies integration, in order to address the pressing environmental challenge of reducing greenhouse gas emissions, while delivering reliably energy to the consumers. The following working groups are setup under VLPGO to meet the objectives: 7.1 WG #1: Synchrophasor Applications Synchrophasor technology, also known as Phasor Measurement Units, has been identified as having great potential to improve reliability of power grids and improve their efficiency. WG #1 provides an excellent platform for sharing lessons learned among its members who are currently implementing it.

7.2

WG #2 ENHANCED SECURITY Due to the current concerns about power system vulnerability, WG #2 is focusing on the criteria, best practices and procedures to enhance the power system resilience. From this benchmark, the WG members will have an opportunity to check and improve their internal procedures and organization.

7.3

WG #2a: Costs for Power System Security Power Grid Operators are faced with a challenge of finding a solution on how to manage the power system security at the lowest possible

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cost without violating system security constraints. WG #2a carried out a survey assessing the impact of power system security in terms of costs for the consumers and how Power Grid Operators manage this problem . 7.4 WG #2b: Electrical Power System Restoration WG #2b provides a platform for VLPGO members to exchange experience on the restoration process in order to reduce the total average restoration time and to obtain solutions for specific issues taking into account experience of the worlds largest Power Grid Operators. 7.5 WG #2c: Equipment & Installation Overstresses Power Grid Operators exchange experience on the processes adopted within their companies to check occurrence of overstress in equipment and installation, collect related information and discuss measures to be taken to solve this problem. 7.6 WG #3: Integration of Renewables Renewable generation is now becoming a major contributor to power systems and its contribution is likely to get even bigger. The existing tools and techniques will cease to deliver efficient, economic and reliable power systems. Exploration of new solutions to integrate renewable based generation into the existing transmission system is required. 7.7 JP: Visualization The aim of the Joint Project is to facilitate development of visualization techniques, and provide means for power operators to share their research and application experiences. The group carries out worldwide research on Dispatching Visualization and develops Application Specifications for Dispatching Visualization. 7.8 WG #4: FLEXILWATTS WG #4 holds research on how demand response is currently treated in different operating procedures, explores future operating needs identifying which consumption sectors will have potential to adapt their demand to these needs and works on drawing principles for the new forecast tools required. 7.9 WG #5: HVDC WG #5 collects data from the VLPGO members related to their experience in operation and planning HVDC projects, including environmental and cost of investment data, and transforms it into the best practices for development and deployment of HVDC projects. 7.10 WG #6: Electric Vehicles

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The goal of WG #6 is to evaluate the impacts of PEVs on the planning, operation and markets of the electric power systems and jointly address the common set of challenges and opportunities that each of the represented countries will experience as a result of PEV acceptance and deployment. 7.11 WG #7: Storage Storage technology poses both opportunities and challenges from a number of different perspectives including technology, implementation and cost/benefit. There is significant momentum worldwide to determine the position and efficacy of storage as part of the overall dynamics of a future power system. 7.12 WS #1: Smart Grids The goal of WS #1 is to understand drivers and develop solutions for deployment of Smart Grid as well as build international consensus by identifying the highest priority subject and sharing the best practices within VLPGO. 7.13 WS #2: KPI WS #2 provides a platform for experience exchange that will allow to determine common approaches and the best practices of KPI identification, calculation and presentation, make results the companies activities clearer and understandable, reduce data required for KPI calculation and simplify business processes used for their identification and estimation. 8.0 COPS 17: The 2011 United Nations Climate Change Conference will be held in Durban, South Africa, from 28 November to 9 December 2011. [1] The conference is officially referred to as the 17th session of the Conference of the Parties (COP 17) to the United Nations Framework Convention on Climate Change (UNFCCC) and the 7th session of the Conference of the Parties serving as the meeting of the Parties (CMP 7) to the Kyoto Protocol. In addition, the two permanent subsidiary bodies of the UNFCCC the Subsidiary Body for Scientific and Technological Advice (SBSTA) and the Subsidiary Body for Implementation (SBI) are likely to hold their 35th sessions. The 2010 United Nations Climate Change Conference extended the mandates of the two temporary subsidiary bodies the Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol (AWG-KP) and the Ad Hoc Working Group on Long-term Cooperative Action under the Convention (AWG-LCA) so they are expected to meet as well.

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A primary focus of the conference will be to secure a global climate agreement as the Kyoto Protocols first commitment period (20082012) is about to end.[2] 9.0 How do we relate Internationally to the Other Grid Operators Worldwide ? 10.0 Associations Worldwide Very Large Power Grid Operators (VLPGO) TSO-Comparison Group CIGRE - C2 and C5 committees International Interconnections

SAARC

U.S. Utilities

11.0

ENTSO-E: A trans-European network

Fully operational since July 2009 Represents 42 TSOs from 34 countries 525 million citizens served 880 GW generation 270,000 km of EHV transmission lines (220 kV upwards) 3,300 TWh/year demand 400 TWh/year exchanges Replaced former TSO organisations: ATSOI, BALTSO, ETSO, NORDEL, UCTE, UKTSOA

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12.0

TSO Comparison Group

The Group of International Comparison of Transmission System Operation Practice Mission To exchange information on Power System Operators current and future operating practices for the purpose of benchmarking. An annual survey is undertaken to ascertain Equivalent staffing requirements Best practices Performance measures Areas Transmission system operations including generation scheduling and dispatching, Electricity market operation, Operations planning, Settlements, Information technology, training, etc. Managed by Kema 13.0 Most important reasons for being a member Members Members Name Country ESKOM South Africa Red Elctrica de Espaa* Spain Landsnet Iceland Fingrid* Finland Amprion* Germany Transpower NZ* New Zealand Saudi Electricity Company Saudi Arabia TenneT Netherlands Statnett SF Norway PJM Interconnection** PA, USA National Grid Electricity Transmission* United Kingdom CLP Power* Hong Kong ESB NG Ireland Transpower Germany Swissgrid Switzerland Rede Elctrica Nacional Portugal Hydro Qubec Canada Svenska Kraftnt Sweden PSE Poland EWA Bahrain China Southern Power Grid China

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 Power Grid Corporation of India Ltd. 14.0 Benchmarking Model

India

The TSO Comparison Group is using an advanced multidimensional Benchmark Model for comparing TSOs System Operation organization. The Models multidimensional approach provides insight into the efficiency and effectiveness of each TSO with respect to both its own environment (size, structure, regulation et al) and to other TSO environments. The Models output has demonstrated the capability of identifying generic differences (resulting in ad hoc peer-groups) as well as generic similarities. The Models output has been utilized for mergers (in defining staff sizing requirements), and tested for self-analysis (in validating actual staff sizes). 14.1 Features of the benchmarking model The model aids in highlighting the effects of non-traditional changes within peer groups. As non-traditional changes, such as new Market initiatives are developed, the Model will display the areas of change. Although the value of those changes will vary with corporate objectives, the magnitude and the areas impacted by the changes will be highlighted by the Model. The key feature of the Model is that it does not focus on defining the best and the worst TSOs, but rather focuses on identifying differences between TSOs. Whether differences are good or not will depend on many factors the Model allows the user to make those value decisions based on the goals of the respective user. 15.0 CIGRE (INTERNATIONAL COUNCIL ON LARGE ELECTRIC SYSTEMS) Aim CIGRE: Developing Technical Knowledge CIGRE develops technical knowledge through 3 types of activities:

Organizing Conferences and meetings, where papers are discussed,

Carrying out Permanent studies by 16 Study Committees, each dealing with a specific technical field, publishing reports and organizing tutorials. Making its publications available to members of CIGRE and others.

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16.0

Study Committee C2 - System Operation and Control The Study Committee C2 serves within Cigr by forming a working concept for the functionalities, structures and competence needed to operate integrated power systems in a way that is in compliance with the social requirements for security of electricity supply. The performance of power systems in real time depend on technical quality factors built into the systems through various activities and knowledge currently covered by the other Cigr Study Committees. SC C2 therefore needs to use and combine results provided within these committees. An area which is unique for C2 is however the dependency on a good performance of human resources in real-time system operation activities. In these respects SC C2 encircles a wide range of competence areas and interfaces to other disciplines. Study Committee C5 - Electricity Markets and Regulation The Mission of Study Committee C5 is "to facilitate and promote the progress of engineering and the international exchange of information and knowledge in the field of electricity markets and regulations. To add value to this information and knowledge by means of synthesizing state-of-the-art practices and by developing recommendations." SC C5 Strategic Goals Development and changes in Operations Market Entities Market Activities and Market Design Market Regulations

17.0

the

Business of

System

17.1

Working Groups of C5 Committee The six Working Groups and one Joint Working Group approved by Technical Committee are:

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WG C5-3 WG C5-7 WG C5-8 WG C5-9 WG C5-10

Investments & Financing of new Transmission and Generation Assets in a Deregulated Environment Market Design Structure and Development of Electricity Markets Renewables and energy efficiency in a deregulated market Retail Market Competition Customer Switching, Metering and Load profiles Establishment of Effective and Sustainable Regulatory Incentives for Capital Investments in Electricity Networks and Generation Market design for large scale integration of renewable energy sources and demand side management

WG C5-11

JWG C2/C55 Development and Changes in the Business of System Operators 18.0 Scope of System Operation Activities

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TABLE OF CONTENTS No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Introduction Part I: Preliminary Part II: National Electricity policy and Plan Part III: Generation of Electricity Part IV: Licensing Part V: Transmission of Electricity Part VI: Distribution of Electricity Part VII: Tariff Part VIII: Works Part IX: CEA Part X: Regulatory Commission Part XI: Appellate Tribunal for Electricity Part XII: Investigation and Enforcement Part XIII: Reorganisation of Board Part XIV: Offences And Penalties Part XV: Special Courts Part XVI: Dispute Resolution Part XVII: Other Provision Part XVIII: Miscellaneous Topic

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Electricity Act 2003-An overview 1.0 INTRODUCTION Electricity Act 2003 has 18 parts (chapters). They are: PART I Preliminary PART II National Electricity Policy and Plan PART III Generation Of Electricity PART IV Licensing PART V Transmission Of Electricity PART VI Distribution Of Electricity PART VII Tariff PART VIII Works PART IX Central Electricity Authority PART X Regulatory Commissions PART XI Appellate Tribunal For Electricity PART XII Investigation And Enforcement PART XIII Reorganization Of Board PART XIV Offences And Penalties PART XV Special Courts PART XVI Dispute Resolution PART XVII Other Provision PART- XVIII Miscellaneous Before this Act, Electricity Act 1910 was in force. Even though, after independence, we enacted most of our own acts and laws. This act had to wait for over six decades. In the year 2000, a draft Act was to be introduced in the parliament. As it met with many reservations, it was referred to a standing committee for modifications. Standing committee submitted its report on 19 th December 2002. Loksabha passed it on 9 th April 2003 followed by Rajyasabha on 5 th may 2003. Presidents accent was received on 26 th May 2003. Gazette publication came through on 2 -6- 2003. For purposes of implementation, periodic extensions were given till 9 th Jun 2006.Thus officially Electricity Act is in force since 10 th Jun 2006. In this discussion let us look at the salient points chapter vice. 2.0 PART 1 PRELIMINARY

Act is applicable in India except the state of J & K. Part I Gives definitions of various terminologies used. Ex: Central Transmission Utility

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"Central Transmission Utility" means any Government company which the Central Government may notify under sub-section (1) of section 38. State Transmission Utility "State Transmission Utility" means the Board or the Government Company specified as such by the State Government under sub-section (1) of section 39 Regional Power Committee Regional Power Committee means a committee established by resolution by the Central Government for a specified region for facilitating the integrated operation of the power systems in that region; .. There are 2 sections (3-4). 3.0 PART II: NATIONAL ELECTRICITY POLICY AND PLAN Here National Policy for Power is laid down. Electricity to all by 2012 Resources Technology Economics Quality Consumer interest so on are dealt with. There are 2 sections (5-6). Ex: The Central Government shall, from time to time, prepare the National Electricity Policy and Tariff Policy, in consultation with the State Governments and the Authority for development of the power system based on optimal utilization of resources such as coal, natural gas, nuclear substances or materials, hydro and renewable sources of energy. The Authority shall prepare a National Electricity Plan in accordance with the National Electricity Policy and notify such plan once in five years. 3.1 National Policy On Stand Alone Systems For Rural Areas And NonConventional Energy Systems The Central Government shall, after consultation with the State Governments, prepare and notify a national policy, permitting stand alone systems (Including those based on renewable sources of energy and nonconventional sources of energy) for rural areas. 3.2 National Policy On Electrification And Local Distribution In Rural Areas The Central Government shall also formulate a national policy, in consultation with the State Governments and the State Commissions, for rural electrification and for bulk purchase of power and management of local distribution in rural areas through Panchayat Institutions, users

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associations, co-operative societies, non-Governmental organizations or franchisees. 4.0 PART III GENERATION OF ELECTRICITY

Generating Company And Requirement For Setting Up Of Generating Station. Formerly Govt. approval was necessary for generating electricity. Act 2003 removes this restriction except for hydro generation has sections 7 1o 11 Ex: (7) Any generating company may establish, operate and maintain a generating station without obtaining a license under this Act if it complies with the technical standards relating to connectivity with the grid referred to in clause (b) of Section 73. (8) (1) Notwithstanding anything contained in section 7, any generating company intending to set-up a hydro-generating station shall prepare and submit to the Authority for its concurrence, a scheme estimated to involve a capital expenditure exceeding such sum, as may be fixed by the Central Government, from time to time, by notification. (9) (1) notwithstanding anything contained in this Act, a person may construct, maintain or operate a captive generating plant and dedicated transmission lines: Provided that the supply of electricity from the captive generating plant through the grid shall be regulated in the same manner as the generating station of a generating company. 5.0 PART IV LICENSING

Authorised Persons To Transmit, Supply, Etc., Electricity Even though previous chapter removes certain generation limitations, transmission, Supply etc. needs license and the granted licenses have 25 years validity. This part has sections 12 to 24. Ex: No person shall (a) transmit electricity; or (b) distribute electricity; or (c) undertake trading in electricity, unless he is authorized to do so by a license issued under section 14, or is exempt under section 13. 6.0 PART V TRANSMISSION OF ELECTRICITY

Part V Deals with transmission of electricity, Load dispatch centers, Power committees, Open access for own use etc and has sections 25 to 41.

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6.1 Grid Operator National level (National Load Despatch Centre) Regional level (Regional Load Despatch Centre) State level (State Load Despatch Centre) GRID STANDARDS Every transmission licensee shall comply with such technical standards, of operation and maintenance of transmission lines, in accordance with the Grid Standards, as may be specified by the Authority. 6.2 National Load Despatch Centre. Optimum scheduling and despatch of electricity among the Regional Load Despatch Centres. The constitution and functions of the National Load Despatch Centre shall be such as may be prescribed by the Central Government:

6.3 Functions of Regional Load Despatch Centre. Apex body to ensure integrated operation of the power system in the concerned region. optimum scheduling and despatch of electricity within the region monitor grid operations; keep accounts of the quantity of electricity transmitted through the regional grid; exercise supervision and control over the inter-State transmission system; and carry out real time operations for grid control and despatch of electricity within the region through secure and economic operation of the regional grid in accordance with the Grid Standards and the Grid Code. The Regional Load Despatch Centre may levy and collect such fee and charges from the generating companies or licensees engaged in inter-State transmission of electricity as may be specified by the Central Commission.

6.4 Compliance of Directions 29. (1) The Regional Load Despatch Centre may give such directions and exercise such supervision and control as may be required for ensuring stability of grid operations and for achieving the maximum economy and efficiency in the operation of the power system in the region under its control. (2) Every licensee, generating company, generating station, substation and any other person connected with the operation of the power system shall comply with the direction issued by the Regional Load Despatch Centres under sub-section (1).

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(3) All directions issued by the Regional Load Despatch Centres to any transmission licensee of State transmission lines or any other licensee of the State or generating company (other than those connected to inter State transmission system) or sub-station in the State shall be issued through the State Load Despatch Centre and the State Load Despatch Centres shall ensure that such directions are duly complied with the licensee or generating company or sub-station. (4) The Regional Power Committee in the region may, from time to time, agree on matters concerning the stability and smooth operation of the integrated grid and economy and efficiency in the operation of the power system in that region. (5) If any dispute arises with reference to the quality of electricity or safe, secure and integrated operation of the regional grid or in relation to any direction given under sub-section (1), it shall be referred to the Central Commission for decision: Provided that pending the decision of the Central Commission, the directions of the Regional Load Despatch Centre shall be complied with by the State Load Despatch Centre or the licensee or the generating company, as the case may be. (6) If any licensee, generating company or any other person fails to comply with the directions issued under sub-section (2) or sub-section (3), he shall be liable to penalty not exceeding rupees fifteen lacs 6.5 Duties of Transmission Licensees to build, maintain and operate an efficient, coordinated and economical inter-State transmission system or intra-State transmission to comply with the directions of the Regional Load Despatch Centre and the State Load Despatch Centre as the may be;. to provide non-discriminatory open access to its transmission system for use byi) any licensee or generating company on payment of the transmission charges; or ii) any consumer as and when such open access is provided by the State Commission under sub-section (2) of section 42, on payment of the transmission charges and a surcharge thereon, as may be specified by the State Commission: DISTRIBUTION OF ELECTRICITY

7.0 PART VI

This part deals with distribution of electricity. Lays down norms for giving connection to consumers. Safety requirements are indicated. Section 53 links to technical provisions of safety etc. This part has sections 42 to 60. Ex.: Duties of Distribution Licensee

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Distribution licensee, to give supply of electricity to such premises, within one month after receipt of the application Where such supply requires extension of distribution mains, or commissioning of new sub-stations, the distribution licensee shall supply the electricity immediately after such extension or commissioning or within such period as may be specified by the Appropriate Commission. In the case of a village or hamlet or area wherein no provision for supply of electricity exists, the Appropriate Commission may extend the said period as it may consider necessary Every distribution licensee to provide, if required, electric plant or electric line Consumer to pay to him such price as determined by the Appropriate Commission. Failure liable to a penalty which may extend to one thousand rupees for each day of default. 8.0 PART VII TARIFF

Endeavors to make electricity a competitive commodity. Salient provisions are No profit cap Commercial principles Competition Efficiency Bidding sections run from 61 to 68 9.0 PART VIII WORKS Lays down procedures for carrying out works in connection with transmission and supply of electricity. Deals also with road cutting. safety, duties and responsibilities etc. these provisions are covered in section 69 10.0 PART IX CENTRAL ELECTRICITY AUTHORITY- SECTIONS ARE FROM 70TO 75 There shall be a body to be called the Central Electricity Authority to exercise such functions and perform such duties as are assigned to it under this Act. The Central Electricity Authority, established under section 3 of the Electricity (Supply) Act, 1948 and functioning as such immediately before the appointed date, shall be the Central Electricity Authority for the purposes of this Act Duties of CEA

10.1

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 11.0

Formulate short-term and perspective plans for development of the electricity system Formulation of technical standards for the electricity system Advice to Central Government, State Government, licensees, the generating companies, Central and State Electricity Regulatory Commissions on technical and other matters Collect and record the data concerning the generation, transmission, trading, distribution and utilization of electricity Make public from time to time information secured under this Act, and provide for the publication of reports and investigations. PART X REGULATORY COMMISSIONS

11.1 Functions Of Central Commission regulate the tariff of generating companies owned or controlled by the Central Government; regulate the tariff of generating companies selling electricity in more than one State; regulate the inter-State transmission of electricity determine tariff for inter-State transmission of electricity; issue licenses to persons to function as transmission licensee and electricity trader with respect to their inter-State operations. adjudicate upon disputes involving generating companies or transmission licensee in regard to above and to refer any dispute for arbitration; levy fees for the purposes of this Act; specify Grid Code having regard to Grid Standards; specify and enforce the standards with respect to quality, continuity and reliability of service by licensees. fix the trading margin in the inter-State trading of electricity, if considered, necessary; Advise the Central Government on formulation of National electricity Policy and tariff policy, promotion of competition, efficiency and economy in activities of the electricity industry, promotion of investment in electricity industry, any other matter referred to the Central Commission by that Government.

Sections are from 76 to 109. 12.0 PART XI APPELLATE TRIBUNAL FOR ELECTRICITY

Sections run from 110 to 125. This part lays down formation of the Appellate Tribunal, its duties and Authority.

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Any person aggrieved by an order made by an adjudicating officer under this may prefer an appeal to the Appellate. Every appeal shall be filed within a period of forty-five days. There will be 1 chairman and 3 members in the tribunal. Award by the tribunal can be challenged only in the Supreme Court. 13.0 Part XII INVESTIGATION AND ENFORCEMENT

Sections 126-130 This part deals with unauthorized use of electricity and details for taking action. Any person aggrieved by a final order may, within thirty days of the said order, prefer an appeal to an appellate authority. The Appropriate Commission may investigate the affairs of any generating company or licensee. 14.0 Part XIII REORGANISATION OF BOARD

The act under provisions of this part abolisher electricity boards. The existing boards are converted as respective Transmission Companies. Existing staff are transferred to the company and no objection may be filed by the employees under the provisions of Industrial disputes Act.. this has sections 131 to 134. 15.0 PART XIV OFFENCES AND PENALTIES Regarding theft of electricity, provisions under the act give wide ranging powers to the utility. Powers relate to entry to the premises, seizure of offending materials and documents etc. Provision to group consumers to below and above 10 Kw, levying penalties and so on. Similarly provisions are available regarding theft of materials. Sections run from 135 to 152. 16.0 PART XV SPECIAL COURTS

Sections 153 to 157 State governments may constitute special courts with single judge for speedy trial of cases of electricity theft 17.0 PART XVI DISPUTE RESOLUTION

Arbitration This part has one section. i.e. 158 Ex: arbitration shall be subject to the provisions of the Arbitration and Conciliation Act, 1996.

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18.0

PART XVII

OTHER PROVISIONS

Deals with others property protection like railways, telephone lines etc. Provides for accident reporting, Appointment of Chief Electrical Inspector and Electrical Inspector and functioning of the same. Has subsections 159 to 165. 19.0 PART- XVIII MISCELLANEOUS

Sections 166 to 185 The Indian Electricity replaces Electricity Act, 1910, the Electricity (Supply) Act, 1948 and the Electricity Regulatory Commissions Act, 1998. Provisions are available for establishment of various forums and clarify many aspects needing the same under some sections.

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TABLE OF CONTENTS Topic A little bit of history Earlier Organisational Logic Modified Organisational Logic Steps towards restructuring Legislation Electricity Act 2003 National Electricity policy Independence of Load Despatch centres Overview of the Act National Tariff Policy Rural Electrification Policy Regulations framed by the regulators Conclusion

No. 1 2 3 4 5 6 7 8 9 10 11 12 13

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LEGAL FRAMEWORK, POLICIES AND REGULATIONS AND ORGANIZATIONAL SET UP IN INDIA The 1990s have seen major changes in the electricity sector. There has been a paradigm shift introduced by a process of electricity restructuring. Over the last twenty years, we find a shift from clinging to the economics of monopoly to one of competition by opening the door to private participation. Slowly but surely there is a shift from considering electricity as a basic service to be provided as a part of the States social policy to one that of a commodity like any other, to be supplied on a profit basis. Since several industrialized countries had already moved into this phase earlier it is but natural that India should be influenced by various theoretical models, empirical results and laws used by those countries. Several modifications in legislation have been made in the last decade in order to incorporate the change in policy. Here too, legislation should not be seen isolation but in conjunction with what it aims to achieve and what steps have been taken to achieve the aims set out for the purpose. 1. A Little Bit Of History: Article 246(2) of the Constitution of India has listed electricity in List 3 of the Seventh Schedule of the Indian Constitution. That means that it is a concurrent subject and that both the Central Government and the State Government can legislate on the subject of electricity. In the event of a conflict between overlapping state and federal authority, the Parliament in New Delhi can exercise preemptive power. In December 1950 about 63% of the installed capacity in the Utilities was in the private sector and about 37% was in the public sector. This position needed correction especially if the newly independent country was to increase its industrial growth and if its rural areas had to be adequately catered to. Two legislative acts, one before and another immediately following Independence, forged the development of the power industry in India. The Indian Electricity Act, 1910 (the IEA), introduced the licensing system in the electricity industry, and the Electricity Supply Act, 1948 (the ESA), provided for state involvement in the industry under the new federal constitutional system. The IEA was enacted at a time when the electricity industry was heavily fragmented, competitive and concentrated heavily in urban areas. In an attempt to impart structure on the infant industry, the IEA primarily addressed the supply and use of electricity under an ad hoc regime of private licensees. The subsequently enacted ESA moved India toward a state dominated system by laying out the statutory powers and functions of the Central Electricity Authority, powerful vertically integrated state electricity boards and state generating companies. One of the fundamental reasons for the enactment of the ESA was to use state control to achieve electrification of rural and semi-urban areas. The 1956

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Amendment to the ESA increased the supervisory control of state governments over the SEBs. Unfortunately, resulting politicization of the SEBs led to massive electricity subsidies in important sectors like agriculture, and substantial operating losses among the SEBs became the norm. Due to the poor financial health of the SEBs and the widening gap between electricity demand and supply throughout India, the ESA was again amended in the 1970s to allow participation of the central government in power generation through large-scale projects that serve more than one state. Because large-scale projects were financially out of reach for the SEBs, central leadership in this area led to the creation of successful federal generating companies like the National Thermal Power Corporation (NTPC) and the National Hydro Power Corporation (NHPC), which now act as significant players in the power industry and may operate as competitors to IPPs in an open access retail regime. However, due to various reasons prominent among them being the lack of viability of the electricity boards, changes had to be made in the power sector. This was also in line with the general reform processes and opening up of the Indian economy. The first phase of reforms were thus introduced in the early nineties with the introduction of a policy statement of October 1991, entitled Government of India Resolution- Policy on Private participation in the Power Sector. This however, did not address the question of financial health of the SEBs and in 1997 a Common Minimum National Action Plan for Power (CMNAP) was announced. This laid the seed for corporatization of the SEBs, creation of the regulators, improvement of efficiency, reduction in cross subsidization etc. Until the early nineties, each State ran one large, vertically integrated setup that generated, transmitted and distributed power (baring a few small privately owned utilities in the south and the west of India). The overall functioning of the power sector in the country was overlooked by the Ministry of Power. The underlying principle for such a structure reflected the internationally held common belief that electricity is a natural monopoly and a public good. Between early 1990s and 2000 several ideas flowed through the Ministry of Power that culminated in the Indian Electricity Act, 2003. 2. Earlier Organizational Logic The earlier understanding was that the electricity sector is a natural monopoly. For instance, it makes sense to lay one set of transmission and distribution lines. This monopoly is legally supported by the State. Vertical integration and central co-ordination were considered necessary. Also because of economies of scale and the need for coordinated operation to ensure reliability, efficient plant operation and dispatch including coordination of generation and transmission, a central unit was necessary. Public ownership was also considered necessary for a central control.

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Policies prior to reform: 1. Meeting the requirements of commercially viable candidatescommercial and industrial users, metropolitan households: 2. Serving underprivileged consumers- agricultural sector through subsidized connectivity programmes and prices 3. Generating surplus for supporting other social programmes: This goal was a complete failure. Cross-subsidies as well as state government subsidies were needed to provide electricity to underprivileged and remotely located consumers. This policy had some success as by 2000, 87 per cent of Indian villages had some access to electricity. 3. Modified Organizational Logic In the last two decades, this entire organizational logic has been turned on its head. Monopsony and monopoly have gained importance. Scale economics are no longer considered important due to emergence of small, cheap and modular gas turbine based electricity generation. It is perceived that coordination can be better done by the market. Eventually market should run with very little regulation through performance incentives. Since the investors are at risk the consumers are expected to do efficient consumption. In this changed scenario there can be public, private and public-private ownership. 4. Steps Towards Restructuring Of Existing Utilities The dismantling and restructuring of the state electricity boards has been the most visible form of reform. The earlier vertically integrated utilities consisting of generation; transmission and distribution under one umbrella were vertically unbundled to create separate generation, transmission and distribution entities. This was followed by horizontal unbundling to create multiple and competing entities in each market segment. Parallel set of management changes such as commercialization and corporatization had to be introduced followed by possible ownership changes that included privatization. Since the number of entities created by such vertical and horizontal splitting may not be sufficient to ensure competition, liberalization of the sector was also thought of. This allowed free entry to other players. Finally, major changes in the technical systems had to be envisaged. Development of critical market and technical system coordinating institutions, such as spot markets and system operators are required to manage co-ordination tasks. There is a renewed emphasis on rural electrification and hence decentralized generation. Change in the manner of functioning of the electricity sector, have evolved around the following: 1. De-integration into generation, transmission and distribution. 2. Further de-integration of each of the above units. 3. Changing the ownership from publically owned assets. This may or may not involve privatization. For instance,

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small distribution companies may be given to a municipality or a co-operative. Sweden for example has de-integrated the sector but ownership largely remains with the municipalities. In India just as elsewhere in the developing world politicised pricing and subsidization, managerial inefficiency and politicized unions are hallmarks of retail electricity supply. It is widely believed that private sector is more efficient than the public sector. 4. Introduction of Regulation parallel to re-organizing the sector. In the absence of competition immediatelyregulation is a surrogate for competition. Regulation is however costly and the obvious starting point is to introduce competition. This has to be accompanied by adequate generation and transmission capacity and efficient trading markets. The much hoped for light hand of regulation has proved elusive worldwide. Indias electric sector reform was expected to include all the above. It has somehow stuttered along very much as before. In The States: In each of the States, the monolithic state electricity boards have been broken down into separate utilities for ensuring generation, transmission and distribution. This has been done with varying degrees of autonomy been given to each of the utilities. For instance, in Tamil Nadu the state electricity board still continues as a single body. In Karnataka, the generation, transmission and distribution companies are absolutely independent of each other. In Rajasthan and Uttar Pradesh, the Transmission Company continues to function as a holding company for distribution companies. In several states generation projects of substantial sizes have come up in the private sector, quite independent of the state governments. However, transmission and distribution remains to a very large extent in the public sector. In The Centre: The Central Government is the overall policy maker for the entire country and operates through the Ministry of Power. The Electricity Act, 1948 has created a Central Electricity Authority that provides policy directions and specifies technical standards for the country. The Central has set up large financial institutions such as the Power Finance Corporation and Rural Electrification Corporation for financing of projects in the states and through the Central Government. All Nuclear power plants are owned by the Nuclear Power Corporation.. 5. Legislation The first major changes in legislation commenced in 1990. The 1991 amendments were specifically aimed to attract foreign investment through Independent Power Producers (IPPs). Concurrent reform legislation also lowered custom duties on imported capital goods, and in some cases

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import tariffs were eliminated (for example, on large scale power generation equipment such as turbines). The 1991 Amendments adopted a cost-plus approach to Indias newly created IPP program, providing for a guaranteed return on equity of at least 16 percent, a five-year tax exemption, and other attractive investment incentives. Under the 1991 Amendments, IPPs were granted attractive terms to set up power stations and sell electricity to the vertically integrated SEBs through long-term power purchase agreements (PPAs). Because project promoters had to work with State Electricity Boards (SEBs), they tended to converge on the better performing SEBs. Particular interest was shown in India by American and British Companies and Government of India provided support to Enron, Cogentrix, AES. Another big change in 1998 was the introduction of the Regulatory Commissions Act. According to this Act independent Regulatory Commissions were created at the Central and the State levels. 6. Electricity Act, 2003 The changes sought for during 1990-2000 culminated in The Electricity Act, 2003. This Act has ushered in major changes in the sector. The Act has made good use of emerging technologies and markets and has sought to encourage competition and efficiencies. This Act has replaced the Indian Electricity Act, 1910, the Electricity Supply Act, 1948 and the Electricity Regulatory Commission Act, 1998. The Electricity Act, 2003 has laid emphasis on competition in the electricity sector. In this one aspect alone it is very different from its preceding Acts. The Act has attempted to increase the number of participants in generating and distributing of electricity. The Act has envisaged major changes to take care of changed policies. These generally include: (a) Generation has been delicensed and captive generation is being actively permitted. (b) Transmission utility at the Central and State level. Transmission will be government owned. The load dispatch function could be kept with the Transmission utility or separated. In case of separation, Load dispatch will be kept with the state government. (c) Provision made for private transmission licensees. (d) There would be open access in transmission from the outset with provision for surcharge for taking care of current level of cross subsidy with the surcharge being gradually phased out. (e) Distribution companies can take up generation and vice-versa. (f) For rural and remote areas stand alone systems for generation and transmission and distribution will be permitted. (g) Decentralized management of distribution through panchayats, user associations, co-operatives or franchisees would be permitted. (h) Trading is recognized as a distinct activity.

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(i)

The State Electricity Regulatory Commission is a mandatory requirement.

Some of the more prominent provisions of the Act are discussed below: Sec 11: The Appropriate Government may specify that a generating company shall, in extraordinary circumstances operate and maintain any generating station in accordance with the direction of that government. In the explanation provided extraordinary circumstances means circumstances arising out of threat to the security of the State, public order or a natural calamity or such other circumstances arising in the public interest. The explanation provided for Sec 11 has been interpreted by at least one state to prevent open access to generators within the state. Sec 65 of the Act on subsidy is an extremely important sec for all electricity boards because they are all dependent on subsidy from the State governments. According to this section, the appropriate Commission should first determine the tariff without subsidy and then the tariff could be reduced depending on the subsidy promised by the government. The subsidy so calculated must be paid to the electricity company. The Act has recognized theft of electricity as a major problem that needs to be addressed and has further amended Sec 135 and 150 on Theft of electricity and abetment to steal electricity. Subsequent to the passing of the Electricity Act, three major policies have been announced: (a) National Electricity Policy 12.2.2005 (b) National Tariff Policy 6.1.2006 (c) Rural Electrification Policy on 23.8.2006 The Central Electricity Authority under sec 177, the Central Electricity Regulatory Commission (sec 178) and the State Electricity Regulatory Commissions (sec 181) have been permitted to issue guidelines and Regulations The Energy Conservation Act, 2001 is another important Act through which is useful for enabling efficiency in use of energy by the electricity utilities. The Act provides the much-needed legal framework and institutional arrangement for embarking on an energy efficiency drive. Under the provisions of the Act, Bureau of Energy Efficiency has been established with effect from 1st March, 2002. The Bureau is responsible for implementation of policy, programmes and coordination of energy conservation activities in the country.

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7.

National Electricity Policy: The Central Government announced the National Electricity Policy in compliance with Sec 3 of the Electricity Act, 2003. This policy has the following wish list: (a) Access to electricity- available for all household in the next five years (b) Availability of power-demand to be fully met by 2012. All shortages to be overcome and a spinning reserve to be made available (c) Supply of reliable and quality power (d) Per capita availability to be enhanced by 2012 (e) Minimum life line consumption to be enhanced (f) Financial turnaround and commercial viability of the sector (g) Protection of consumer interest To a large extent the Policy is a reiteration of the various sections of the Electricity Act, 2003. Unlike in earlier years there is a focus on assessment of demand. Instead of groping in the dark, clear directives are provided in para 3.1 and 3.2 to the Central Electricity Authority to set up a National Electricity Plan once in 5 years while giving a long term perspective for 15 years. Further reference is invited to Sec 73(a) of the Act that requires formulation of short term and perspective plans for development of the electricity system and co-ordinating activities of various planning agencies for optimal utilization of resources. The Policy pays tremendous importance to rural electrification. As a matter of fact, the Ministry of Power web-site has a separate head for Rural electrification. While in general the policy has reiterated the importance of electricity in rural areas and hence the need for household electrification on demand and the presence of distributed generation, one of the major policy shifts is seen in para 5.1.6 of the Policy according to which the responsibility of operation and maintenance and cost recovery of the rural infrastructure could be discharged by utilities through appropriate arrangements with the Panchayats, local authorities, NGOs and other franchisees. The Central Government has provided large quantities of funding in accordance with this Policy through programmes such as the RGGVY, under which electricity distribution infrastructure is envisaged to establish Rural Electricity Distribution Backbone (REDB) with at least a 33/11KV sub-station, Village Electrification Infrastructure (VEI) with at least a Distribution Transformer in a village or hamlet, and standalone grids with generation where grid supply is not feasible For the first time energy conservation and environmental issues have been highlighted. (Para 5.9 and 5.10). Para 5.9 talks about Demand side management, improved agricultural pumpsets and a voluntary approach to energy conservation. The Policy has emphasized the importance of flattening of the load curve by reducing the demand during peak periods by adoption of suitable load management techniques.

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The Policy concludes by entrusted the responsibility of attaining the objectives of the Electricity Policy to the Regulators. The Regulators have also been entrusted with a development role whose fulfillment would need a less formal and a consultative process. The Regulatory Commissions are not expected to follow a formal judicial approach. On the other hand implementation of the Electricity Policy is expected to be through a consultative process. Thus, while the intentions of the government in improvement in the electricity sector are laudable, the Policy does not quite say how this objective is to be achieved. 8. Independence Of Load Dispatch Centers: With the Act emphasizing Open access, the role of the load dispatch centers has become very important. Since the entire monitoring of the power system is done through the load dispatch centers, it is essential that the LDCs are able to do a real time monitoring of all systemsgeneration, transmission and distribution. It is a back-breaking 24/7 exercise and has to be done with no hiccups. Hence, new technologies such as the SCADA systems have been introduced. Nevertheless, the LDCs have to function independently. With private sector being permitted to enter transmission as well (in the form of public-private partnerships) there is a move to make the LDCs as separate ring fenced organizations. The Electricity Policy had desired that the Central Government would examine the independence of the Load Dispatch Centers was to be examined by the Central Government by Dec 2005. A committee was set up under the Chairmanship of Shri Grireesh B Pradhan to look into the Ring fencing of the Load dispatch centers. (Report Aug 2008). The spirit of the Act is to ensure independence for System Operation. Under the reform process pursued by the Government of India, the Electricity Supply Industry (ESI) in India is developing at a fast pace. The committee perceives load despatching in the 21st century as a mission critical activity for uninterrupted and reliable power supply; a facilitator for an efficient electricity market; an optimizer of precious power generating resources; an instrument for equitable and fair use of the available transmission infrastructure and an indispensable link between the managers, administrators, planners and regulators on one end and the physical system on the other end. LDCs would also play a major role in facilitation and deployment of renewable energy sources and consider minimizing emission despatch as an objective function. Thus strengthening of Load Despatch Centres in India would yield substantial gains to all stakeholders. In the rapidly changing scenario, the credibility of the ESI in India is in large measure in the hands of the System Operators at the Load Despatch Centres. They have to be neutral, fair, transparent, and accountable in discharging their duties. The factors that influence the performance at the LDC are the external business environment, internal work environment, clarity of goals, operating aids to perform, motivation to perform and skills and knowledge of the individuals. Strategic

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interventions in all the above would enhance the performance of the Load Despatch Centres. The committee constituted by the Government of India went into the details of the functioning of Load Despatch Centres and has arrived at its recommendations in this report. All efforts need to be made to create an environment where the Load Despatch Centres have functional autonomy, independent and sustainable revenue streams and are adequately staffed with people having the right skills, equipment and incentives to deliver. The recommendations of the Report on Ring Fencing of the LDCs has been accepted and directions have been issued on 13 th Oct 2008 to implement the Report. Several recommendations have been given. However, the states have not moved much on the subject of ring-fencing the Load dispatch centres. The National Load Despatch Centre (NLDC) has been constituted in accordance with sec 26 of the Electricity Act, as per Minis try of Power (MOP) Notification, New Delhi dated 2nd March 2005 and is the apex body to ensure integrated operation of the national power system. Sec 176(2)(d) has permitted the Central Government to make rules for the functioning of the NLDC. The National Load Despatch Center (NLDC) was inaugurated on 25th February, 2009. The main functions assigned to NLDC are: Supervision over the Regional Load Despatch Centres. (a) Scheduling and dispatch of electricity over the inter-regional links in accordance with grid standards specified by the authority and grid code specified by Central Commission in coordination with Regional Load Despatch Centres. (b) Coordination with Regional Load Despatch Centres for achieving maximum economy and efficiency in the operation of National Grid. Monitoring of operations and grid security of the National Grid. (c) Supervision and control over the inter-regional links as may be required for ensuring stability of the power system under its control. (d) Coordination with Regional Power Committees for regional outage schedule in the national perspective to ensure optimal utilization of power resources. Coordination with Regional Load Despatch Centres for the energy accounting of inter-regional exchange of power. (e) Coordination for restoration of synchronous operation of national grid with Regional Load Despatch Centres. (f) Coordination for trans-national exchange of power. (g) Providing Operational feedback for national grid planning to the Authority and Central Transmission Utility. (h) Levy and collection of such fee and charges from the generating companies or licensees involved in the power system, as may be specified by the Central Commission. (i) 10.Dissemination Of information relating to operations of transmission system in accordance with directions or regulations issued by Central Government from time to time.

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The Power Systems Operation Corporation (POSOCO) has been set up as a wholly owned subsidiary of Power grid. POSOCO is a fully owned subsidiary of POWERGRID. Now these Regional Load Despatch Centres (RLDCs) and National Load Despatch Center (NLDC) are under a separate organisation named POSOCO (Power system Operation Corporation). 9. Overview Of The Act: The question that has to be addressed is whether the new Electricity Act of 2003 been effective and has the electricity sector improved in the last ten years. If not, is it because of bad legislation or just unwillingness to implement the Policy and the Act. Some important references made to the Electricity Act in the Electricity Policy include sec 3(1) and 3(4)- to formulate and revise a Electricity Policy, 6 on obligation to supply electricity to rural areas and sec 42(2) on open access. 10. National Tariff Policy: This Policy was introduced on 6.1.2006 in continuation of the National Electricity Policy, 2005. The aim of this policy is to attract adequate investment for fulfilling the aim of the Electricity Policy to add a generation of 1 million MW during the 10 th and 11th Plan period and to have per capita availability of 1000units per year and to have a spinning reserve of 5% in the system. For this proper user charges need to be determined and paid. Proper regulation for this purpose also needs to be developed. Sec 3 (1) of the Act empowers the central the central government to formulate the Tariff Policy. Sec 61 of the Act also requires that the CERC and the SERCs should be guided by the Tariff Policy while discharging their functions. A forum of Regulators has been constituted by the Central Government so that there is consistency in approach especially in the area of distribution. In keeping in line with the Act, emphasis is on competition. All future requirement of power should be through a process of competitive bidding and not through the earlier Memorandum of Understanding route. This would be applicable to public sector units as well. The Policy expresses the need to have a balance between the rate of return on a project and the interests of the consumer. It has permitted a debt : equity ratio of 70:30 but there could be a higher contribution of equity. Rates of depreciation are to be notified, debt management is highlighted and foreign exchange risk is not allowed to be a pass through (hedging and swapping are permitted). The concerned SERCs are expected to lay down operating norms. Renovation and modernization are to be encouraged.

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An important aspect of the Policy is the introduction of Multi-Year Tariff from 1.4.2006. The framework should feature a five year control period. Benchmarking studies should be conducted. Regulation of outputs is to be monitored and a comprehensive review of performance may be taken up by the concerned Regulatory Commission. Tariff fixation for all electricity generation projects should take into account benefits obtained from Clean Development Mechanisms (CDM). Para 6 of the Policy requires that a Two-Part Tariff structure be fixed so that Merit Order dispatch can be followed. According to the Electricity Policy an Availability Based Tariff should be introduced by April 2006. ABT has become one of the success stories of the new Tariff Policy though intra-state ABT is still a distant possibility is several States. Adequate security mechanism must be in place for power generators. Encouragement has to be provided to harnessing Captive Generation and captive generators should be encouraged to connect to the grid. Firm supplies may be bought from the captive plants using guidelines issued under sec 63 of the Act. A minimum amount of non-conventional energy has to be bought, The appropriate Commission shall fix the quantum in accordance with sec 86(1)(e)of the Act. Issues relating to transmission are dealt with under sec 7. Here too the emphasis is on attracting investment in the sector. The Tariff Policy directs that in accordance with the National Tariff Policy, there should be a national tariff framework and that this framework should be sensitive to distance and direction and should be related to the quantum of power flow. Investment by agencies other than the state transmission utilities have been made possible. However, these investments shall be through a system of competitive bidding. There are several far reaching policies made in the Tariff Policy on distribution. Most importantly, all power purchase costs are to be considered as legitimate ( sec 8.2.1) unless it has been established that merit order dispatch has not been followed or that the price of power was exorbitant. Aggregate Technical and Commercial Losses need to be brought down. Sec 65 of the Act on payment of subsidy to the Electricity distribution companies has been reiterated. The Policy also allows creation of a Regulatory asset (sec 8.2.2) only as an exemption and that to under certain specific circumstances. In no event should the creation of a regulatory asset be a repetitive exercise. In accordance with sec 61(g) of the Act, attention needs to be paid to recoupment of cost of service through the Tariff. Certain principles have been laid down for the purpose of allowing cross-subsidization in tariff. For instance persons below poverty line may be given cheaper electricity .But

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the Tariff to this category cannot be less than 50 % of the average cost of supply. Sec 62(3) of the Act allows for differential tariff in agriculture based on geographic location and ground water table. Free electricity is not to be encouraged and metering should be ensured. The Act encourages Open access. Therefore the Tariff Policy has been designed to allow reasonable surcharge on open access so that generating units who chose to provide power through the grid are able to compete. Some of the provisions of the Electricity Act on which the Tariff Policy is based include: Sec 3(1) on the right of the Central Government to formulate a Tariff Policy and review it. Sec 61, 63 and 86 (1)(e) on generation policies. Sec 57, 61,62 and 65 on distribution related policies. 11. Rural Electrification Policy: This policy has been enunciated under section 4 and 5 of the Act. Under the Common Minimum Programme, electricity to all households has been envisaged in 5 years. In order to achieve this the Rajiv Gandhi Viduytikaran Yogna has been launched. Schemes for Rural Electricity Infrastructure and Household Development. The purpose of these schemes is to provide a rural electricity distribution backbone (REDB), creation of village electrification infrastructure (VEI) and decentralized distributed generation and supply(DDB). All these schemes are expected to aid in overall rural development in agriculture, small and medium industries, khadi and village industries, development of cold chains, health care and IT. Para 6 of the Policy requires local involvement in rural electrification pursuant to sec 166(5) of the Electricity Act. Para 9 of the Policy and sec 5 of the Act highlight the need to implement Article 243(g) in the eleventh Schedule of the Constitution of India according to which local level institutions have been empowered to undertake the business of electricity distribution. Section 13 of the Act is the enabling provision in this connection. Relevant provisions in the Act that are required for the Rural Electrification Policy are sec 2(63), sec 4, sec 5, sec 6, sec 13 and sec 14. 12. Regulations Framed By The Central Electricity Regulators And The State Electricity Regulators: Sec 178 of the Electricity Act had allowed the Central electricity regulators to issue regulations with respect to the functioning of the electricity sector. These regulations have sometimes been difficult to implement. For example, recently the CERC has issued the CERC ( Sharing of inter-state transmission charges and losses) Regulations on 16.6.2010.While the

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Government has demonstrated its intention of segregating distribution from transmission of electricity, this Regulation now seeks to make the Central Transmission utility collect transmission charges from the distribution companies on behalf of other transmission utilities. Similarly the State transmission utility is expected to collect transmission charges payable to the Central Transmission Utility or any other transmission utility from the distribution companies and pass it on to the CTU. Part XI, section 110 of the Act has set up an Appellate Tribunal for Electricity to hear appeals against the orders of Commission or an adjudicating officer under the Act. 13. Conclusions: It is quite evident that several legislative changes have taken place over the last two decade in particular. Some of these modifications have been too fast for the sector to cope up with and some of them are difficult to adhere to.

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TABLE OF CONTENTS No. 1 2 3 4 5 6 7 8 9 Electricity Bodies in India State Electricity Regulatory Commissions Joint Commission Powers of CERC/ SERC/ JC Functions and Duties of CEA Certain Powers and Directions Forum of Regulators Background Regulatory Framework in India Constitution, Structure, Duties, Functions and Powers of Topic

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REGULATORY FRAME WORK IN INDIAN POWER SECTOR 1. Back Ground In India, Electricity is a scarce commodity. It has turned out to be a basic need of life. Any commodity when it falls short of meeting the demand, the same needs to be controlled in order to ensure equitable distribution. In a society where there is an economic imbalance, the gap between the poor and the rich is wide, regulating the supply of scarce commodity to ensure reaching it to all members of the society becomes the fundamental governing principle. This principles leads to a mechanism called Regulation. The dictionary meaning of Regulation is to control or to direct by way of law or rule or guideline/instruction. The Regulatory frame work essentially provides the ways and means to control the activities relating to the power sector, through statutory measures. In our Country, Electricity is a subject matter of entry 38 in the concurrent list of Constitution of India. Because it finds a place in the concurrent list, law can be made at the central level and as well at the state level to govern the activities of power sector. Hence there is scope for establishment and functioning of statutory authorities both at the central level and at the State level to control, monitor and govern the operations of the Power Sector. 2. Regulatory Framework in India Although one may say that the erstwhile electricity laws viz the Indian Electricity Act 1910, the Electricity Supply Act 1948 and the rules framed under them provided a regulatory mechanism to monitor and control the electricity sector, it was the Electricity Regulatory Commissions Act 1998 that paved the way for an explicit Regulatory Frame Work for the Indian Electricity Sector. It mandated the nation to have one regulator at the Center to handle the interstate electricity transaction and a State Regulator in each State to deal with the State level electricity matters. Hence two level Regulatory mechanism came into existence viz the Central Electricity Regulatory Commission (CERC) and the State Regulatory Commission (SERC). The ERC Act also provided for the states to have their own State Acts for establishing the State Commission and also to carry forward the Reforms and Restructuring Activities. For example, Orissa, Haryana, Andhra, Karnataka were among first states in the Country, to come out with their own State Acts and to establish SERCs. Even before the enactment of Electricity Act 2003, almost all the States had established the SERC in their respective states. The CERC was constituted under the provisions of section 1(3) of the ERC Act 1998 and started its operation from July 1998. Later on, each state established their own SERCs which were operationalised in different time periods.

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The table below provides details of some SERCs that were established under the ERC Act 1998 and the date of commencement of their operations. Name of Commission CERC Assam Andhra Bihar Chattisgarh Delhi Jharkhand Madhyapradesh Kerala Maharastra Orissa Karnataka Tamilnadu Established under ERC Act 1998 24th July 1998 2nd July 1998 31st March 1999 15th April 2002 20th May 2005 23rd August 2008 3rd March 1999 24th April 2003 20th August 1998 November 2002 5th August 1999 1st August 1996 15th November 1999 1st July 1999

Later when the Electricity Act 2003 came into existence from 10 th June 2003, the already existing CERC and SERCs were made operate under the provisions of the new law. However, it may be seen that the structure of the Regulatory authorities have almost been retained as the same in ERC Act 1998. Statutory Bodies Regulating the Power Sector 1) The Central Electricity Regulatory Commission (CERC) 2) The State Electricity Regulatory Commission ( SERC) 3) Joint Commission ( JC) 4) The Appellate Tribunal for Electricity ( ATE) 5) The Central Electricity Authority ( CEA) 6) The Forum of Regulators ( FOR) In addition to the above, at the State Level, specific to distribution sector we have the following authorities a) The Appellate Authority ( Section 127 of the Act) b) The Consumer Grievance Redrssal Forum ( CGRF) -Section 42(5) c) The Ombudsman - Section 42 (6)) 3. CONSTITUTION, STRUCTURE , DUTIES , FUNCTIONS AND POWERS OF ELECTRICTY REGULATORY BODIES IN INDIA The Central Electricity Regulatory Commission (CERC) Constitution CERC was established under the provisions of Section 1 (3) ERC Act 1998. It was operationalised from 24 th July 1998. Now it continues to operate under section 76 of Electricity Act 2003, as the ERC Act 1998 is a repealed law in terms of section 185 of Electricity Act 2003. 67

Structure The Central Commission shall consist of the following Members, namely: (a) A Chairperson and three other Members; (b) The Chairman of the Central Electricity Authority shall be an ex-officio member The Chairperson and the other Members of the Central Commission shall be appointed by the Central Government on the recommendation of the Selection Committee referred to in Sec. 5 of the ERC Act 1998. However, Judges of Supreme Court of Chief Justice of High Court can be appointed directly to the post. Functions of CERC in terms of Section 79 of EA 2003 a. to regulate the tariff of generating companies b. to regulate the inter-State transmission of electricity ; c. to determine tariff for inter-State transmission of electricity; d. to issue licenses to persons to function as transmission licensee and electricity trader with respect to their inter-State operations; e. to adjudicate upon disputes involving generating companies or transmission licensee in regard to matters connected with Generation, interstate transmission and trading f. to specify Grid Code having regard to Grid Standards; g. to specify and enforce the standards with respect to quality, continuity and reliability of service by licensees; h. to fix the trading margin in the inter-State trading of electricity, if considered, necessary; i. to advise the Central Government on all or any of the following matters, namely :(i) formulation of National electricity Policy and tariff policy; (ii) promotion of competition, efficiency and economy in activities of the electricity industry; (iii) promotion of investment in electricity industry; (iv) any other matter referred to the Central Commission by that Government. 4. State Electricity Regulatory Commission ( SERCs) Constitution: Most of the State Electricity Regulatory Commissions were formed directly under the provisions of the ERC Act 1998 or under the provisions of the State enactments which in turn were formulated under the provisions of ERC Act 1998. Now they are continued under the provisions of section 82 of Electricity Act 2003. Structure (as per the provisions of section 82 (4) & (5) of Electricity Act 2003)

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The State Commission shall consist of not more than three Members, including the Chairperson. The Chairperson and Members of the State Commission shall be appointed by the State Government on the recommendation of a Selection Committee referred to in section 85 of EA 2003 Functions of the State Commission (Section 86 of EA 2003) To determine the tariff for generation, supply, transmission and wheeling of electricity, wholesale, bulk or retail, as the case may be, within the State: Provided that where open access has been permitted to a category of consumers under section 42, the State Commission shall determine only the wheeling charges and surcharge thereon , if any, for the said category of consumers; To regulate electricity purchase and procurement process of distribution licensees including the price at which electricity shall be procured from the generating companies or licensees or from other sources through agreements for purchase of power for distribution and supply within the State; facilitate intra-State transmission and wheeling of electricity; issue licenses to persons seeking to act as transmission licensees, distribution licensees and electricity traders with respect to their operations within the State; promote co-generation and generation of electricity from renewable sources of energy by providing suitable measures for connectivity with the grid and sale of electricity to any person, and also specify, for purchase of electricity from such sources, a percentage of the total consumption of electricity in the area of a distribution licensee; adjudicate upon the disputes between the licensees, and generating companies and to refer any dispute for arbitration; specify State Grid Code consistent with the Grid Code specified under clause (h) of sub-section (1) of section 79 of EA 2003 specify or enforce standards with respect to quality, continuity and reliability of service by licensees; fix the trading margin in the intra-State trading of electricity, if considered, necessary;

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 The State Commission shall advise the State Government on all or any of the following matters, namely :-. (i) promotion of competition, efficiency and economy in activities of the electricity industry; (ii) promotion of investment in electricity industry; (iii) reorganization and restructuring of electricity industry in the State; (iv) matters concerning generation, transmission , distribution and trading of electricity or any other matter referred to the State Commission by that Government. 5. JOINT COMMISSION Constituted under Section 83. Joint Commission may be constituted by an agreement to be entered into (a) by two or more Governments of States; or (b) by the Central Government, in respect of one or more Union territories, and one or more Governments of States, and shall be in force for such period and shall be subject to renewal for each further period, if any, as may be stipulated in the agreement: Provided that the Joint Commission, constituted under section 21 A of Electricity Regulatory Commissions Act, 1998 shall continue to hold office, on the same terms and conditions on which they were appointed Structure The Joint Commission shall consist of 1 Member from each of the participating States and Union Territories and the Chairperson shall be appointed from amongst the Members by consensus, failing which by rotation. An agreement under sub-section (1) shall contain provisions as to the name of the Joint Commission, the manner in which the participating States may be associated in the selection of the Chairperson and Members of the Joint Commission, manner of appointment of Members and appointment of Chairperson by rotation or consensus, places at which the Commission shall sit, apportionment among the participating States of the expenditure in connection with the Joint Commission, manner in which the differences of opinion between the Joint Commission and the State Government concerned would be resolved and may also contain such other supplemental, incidental and consequential provisions not inconsistent with this Act as may be deemed necessary or expedient for giving effect to the agreement. Functions

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The Joint Commission shall determine tariff in respect of the participating States or Union Territories, separately and independently. May exercise the powers in respect of all or any of the matters specified under sub-section (3) of the Section 83 of the Act , when so specifically authorized by the participating States. 6. Powers of CERC/SERC/JC Under Section 94 of EA 2003 Same power as that of a Civil Court 1. Discovery and production of any document or other material object producible as evidence; 2. Receiving evidence on affidavits; 3. Requisitioning of any public record; 4. Issuing commission for the examination of witnesses; 5. Reviewing its decisions, directions and orders; Appellate Tribunal for Electricity Constituted, in terms of Section 110 of Electricity Act 2003 in April 2004 and commenced its operations on 21st July 2005 Consists of Four members, of which two are judicial members and two are non judicial members. Each bench shall have one Judicial members. Purpose is to hear appeals against the orders passed by adjudicating officer or order passed by appropriate Commission. Appeal to be filed within 45 days of receipt of the Order. ATE, to pass final Orders within 180 days from the date of receipt of appeal. Central Electricity Authority Was constituted under section 3 of Electricity (supply) Act 1948 but continued under section 70 of EA 2003. Shall consist of not more than 14 members. 7. Functions and Duties of CEA ( Section 79 of EA 2003) The Authority shall perform such functions and duties as the Central Government may prescribe or direct, and in particular to (a) advise the Central Government on the matters relating to the national electricity policy, formulate short-term and perspective plans for development of the electricity system and co-ordinate the activities of the planning agencies for the optimal utilisation of resources to subserve the interests of the national economy and to provide reliable and affordable electricity for all consumers;

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(b) specify the technical standards for construction of electrical plants, electric lines and connectivity to the grid; (c) specify the safety requirements for construction, operation and maintenance of electrical plants and electric lines; (d) specify the Grid Standards for operation and maintenance of transmission lines; (e) specify the conditions for installation of meters for transmission and supply of electricity; (f) promote and assist in the timely completion of schemes and projects for improving and augmenting the electricity system; (g) promote measures for advancing the skill of persons engaged in the electricity industry; (h) advise the Central Government on any matter on which its advice is sought or make recommendation to that Government on any matter if, in the opinion of the Authority, the recommendation would help in improving the generation, transmission, trading, distribution and utilisation of electricity; (i) collect and record the data concerning the generation, transmission, trading, distribution and utilisation of electricity and carry out studies relating to cost, efficiency, competitiveness and such like matters; make public from time to time the information secured under this Act, and provide for the publication of reports and investigations;

(j)

(k) promote research in matters affecting the generation, transmission, distribution and trading of electricity; (l) carry out, or cause to be carried out , any investigation for the purposes of generating or transmitting or distributing electricity; (m) advise any State Government, licensees or the generating companies on such matters which shall enable them to operate and maintain the electricity system under their ownership or control in an improved manner and where necessary, in co-ordination with any other Government, licensee or the generating company owning or having the control of another electricity system; (n) advise the Appropriate Government and the Appropriate Commission on all technical matters relating to generation, transmission and distribution of electricity; and (o) discharge such other functions as may be provided under this Act.

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8.

Certain powers and directions Section 74. (Power to require statistics and returns): It shall be the duty of every licensee, generating company or person generating electricity for its or his own use to furnish to the Authority such statistics, returns or other information relating to generation, transmission, distribution, trading and use of electricity as it may require and at such times and in such form and manner as may be specified by the Authority. Section 75 (Directions by Central Government to Authority): --- (1) In the discharge of its functions, the Authority shall be guided by such directions in matters of policy involving public interest as the Central Government may give to it in writing. (2) If any question arises as to whether any such direction relates to a matter of policy involving public interest, the decision of the Central Government thereon shall be final.

9.

FORUM OF REGULATORS ( FOR) Constitution of the Forum The Forum of Regulators (FOR) was constituted vide Notification dated 16th February, 2005 in pursuance of the provision under section 166(2) of the Electricity Act, 2003. The Forum consists of Chairperson of Central Electricity Regulatory Commission (CERC) and Chairpersons of State Electricity Regulatory Commissions (SERCs). The Chairperson of CERC is the Chairperson of the Forum. Structure The Forum shall consist of the Chairperson of the Central Commission and Chairpersons of the State Commissions. The Chairperson of the Central Commission shall be the Chairperson of the Forum of Regulators. The Secretary to the Central Commission shall be the ex-officio Secretary to the Forum. Secretarial assistance to the Forum shall be provided by the Central Commission. The headquarters of the Forum will be located at New Delhi. Functions of the Forum The Forum shall discharge the following functions, namely:

Analysis of the tariff orders and other orders of Central Commission and State Commissions and compilation of data arising out of the said orders, highlighting, especially the efficiency improvements of the utilities; Harmonization of regulation in power sector;

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Laying of standards of performance of licensees as required under the Act. Undertaking research work in-house or through outsourcing on issues relevant to power sector regulation; Evolving measures for protection of interest of consumers and promotion of efficiency, economy and competition in power sector;

REGULATIONS RELATING TO SYSTEM OPERATION The IEGC Regulations Grant of Connectivity and Open Access Regulations UI Charges Regulations Sharing of Interstate Transmission Charge and Losses, Regulations SUMMARY Electricity operations were put into a regulatory frame work from 1998. The objective of introducing regulators was - to improve the efficiency of the sector by continuous monitoring through performance standards, - reduction of Transmission and Distribution losses by setting road maps and imposing penalties for non achievement - Tariff rationalization - Introduction and implementation of Transparent tariff setting process - Facilitate System Operation through implementation of open access and connectivity regulations. - To ensure safety to people and property in electricity supply. Based on the provisions of the Act, various regulatory bodies like , CERC, SERC, ATE , CEA, FOR, CGRF and Ombudsman have been put into place at different levels in the power sector. Therefore, today all the operations in the electricity sector are watched and controlled to ensure efficiency for the benefit of the end consumer.

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TABLE OF CONTENTS Topic Current Energy Scenario Solution : Smart Grid Economic Consideration and Barriers in Financing Regulator and Social Pressures Super Conducting Cables & Smart Grids Conclusion

No. 1 2 3 4 5 6

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1. CURRENT ENERGY SCENARIO The electric industry emerged as a grid-connected, central station network during the 1920s and 1930s. The shape of the industry had been set decades earlier when George Westinghouse won the battle with Thomas Edison over AC vs. DC power and large central station grid-connected vs. small-scale distributed generation networks. In the following fifty years, technological advances enabled ever-larger power plants to be built at ever lower unit costs. As the industry expanded, the enormous fixed costs of the grid-connected central station network could be spread over many more units of production, further reducing unit costs. The new electricity technology turned night into day by providing a better source of illumination and made it possible to locate power sources and work that needed it at great distances from rivers that for most of human existence had served as the most important source of motive power. This miraculous new technology changed the nature of work radically. Electricity is bridging the gap between being a commodity to a premium value-added service. This is leading to a drastic change in how electricity is produced, transported and used. That, in turn, influences the way societies grow and the way people live their day-to-day lives. After its financing needs were resolved either through the advent of regulated monopolies or direct government ownership, the electric supply industry enjoyed decades of almost uninterrupted growth. But that has changed. One of the reasons behind this is enormous increase in the energy demand. The greatest challenge facing electric distribution is responding to rapidly changing customer need s for electricity. Increased use of IT, computers and consumer electronics has lowered the tolerance of outages, fluctuations in voltages and frequency levels and other power quality disturbances. Running today digital society through yesterdays grid is like running the internet through an old telephone switch board. With respect to India how this energy demand scenario changed is given below. 1.1 Growing Energy Demand:

Energy has been universally recognized as one of the most important inputs for economic growth and human development. There is a strong two-way relationship between economic development and energy consumption. It is not only economic development that leads to availability of electricity but also electricity availability that enhances economic development. On one hand, growth of an economy, with its global competitiveness, hinges on the availability of cost-effective and environmentally benign energy sources, and on the other hand, the level of economic development has been observed to be reliant on the energy demand. 1.1.1 Indian Scenario: In the recent years, Indias energy consumption has been increasing at one of the fastest rates in the world due to population growth and economic

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development. Primary commercial energy demand grew at the rate of six per cent between 1981 and 2001 (Planning Commission 2002). India ranks fifth in the world in terms of Primary Energy Consumption. Despite the overall increase in energy demand, per capita consumption in India is still very low compared to other developing countries. India is well-endowed with both exhaustible and renewable energy resources. Coal, oil, and natural gas are the three primary commercial energy sources. Indias energy policy, till the end of the 1980s, was mainly based on availability of indigenous resources. Coal was by far the largest source of energy. However, Indias primary energy mix has been changing over a period of time. Despite increasing dependency on commercial fuels, a sizeable quantum of energy requirements (40% of total energy requirement), especially in the rural household sector, is met by non-commercial energy sources, which include fuel wood, crop residue, and animal waste, including human and draught animal power. However, other forms of commercial energy of a much higher quality and efficiency are steadily replacing the traditional resources being consumed in the rural sector. Resource augmentation and growth in energy supply has not kept pace with increasing demand and, therefore, India continues to face serious energy shortages. This has led to increased reliance on imports to meet the energy demand. Access to affordable and reliable electricity is critical to a countrys growth and prosperity. The country has made significant progress towards the augmentation of its power infrastructure. In absolute terms, the installed capacity has increased from only 1.36 GW at the time of independence 186 GW as on December 2011. Per capita electricity consumption rose from merely 15.6 kWh (kilowatt-hours) in 1950 to more than 850 kWh in 2010-11. However, it is a matter of concern that per capita consumption of electricity is among the lowest in the world. Moreover, poor quality of power supply and frequent power cuts and shortages impose a heavy burden on Indias fast-growing trade and industry. State and federal governments have initiated reforms, legislation designed to supply electricity to all consumer groups, conservative elements, and social programs. Systemic weaknesses and contradictions within frequently combine to stifle progress. Additionally factors like increasing economic activity, wealth and population, an improved standard of living and infrastructure developments such as shopping malls, SEZs are all expected to underline a continuous increase in demand for power in the next decade. Mean while the major drivers of consumption growth are expected to be the industrial, residential and agricultural sectors. 1.2 Rising Consumer Expectation:

Since the invention of electricity the world has come a long way. Consumer appliances too have radically transformed from analog radio, T.V, Walkman, Computers, I-POD to modern day hi-end phones. These gadgets now include wide range of equipments needing more and more reliable and variable supply. All in all people depend a lot on electricity today. Energy demand is growing enormously and also consumers are so much aware about their

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needs that utilities have to supply good quality, reliable power consistently. As conventional energy sources are limited and integration of renewable energy in grid is difficult, it is necessary to develop such a grid system which will help to use existing power efficiently and also integrate electricity produced by renewable resources. New priority: demand must follow production Production Demand

2.

SOLUTION: SMART GRID

Recently, the concept known as the smart grid has been gaining momentum. The idea has captured the imagination of a widening circle of believers and it is finding its way into the public consciousness. The Smart Grid cannot be reduced to a simple formula or template. It is as much a vision as a blueprint. In its broadest interpretation, the smart grid vision sees the electric industry transformed by the introduction of two-way communications and ubiquitous metering and measurement. It will enable much finer control of energy flows and the integration and efficient use of renewable forms of energy, energy efficiency methodologies and technologies, as well as many other advanced technologies, techniques and processes that wouldnt have been practicable until now. It will also enable the creation of more reliable, more robust and more secure electrical infrastructure, and it will help optimize the enormous investments required to build and operate the physical infrastructure required. There are some who say these ideas are not yet practicable or that the cost of implementing them will exceed the benefits. There are some thorny practical problems, too. Most notable are customer response and cost-benefit analysis (CBA). How customers will respond to time-of-use (TOU) rates much of the potential benefit attributed to the smart grid hinges on the effectiveness of TOU rates is a pivotal issue but difficult to estimate before the fact. If there is not wide adoption rate of TOU rates, the expected benefits could be anemic.

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There is a convergence occurring between the business realities of the utility industry, the energy demands of modern society, and the sustainability requirements of the environment in which we live. The combination of these factors is driving the development and implementation of a new power delivery system. This network will utilize the same basic infrastructure we know today, but will also draw on advanced monitoring, control and communications technology that is presently only beginning to be applied. The result will be a grid that is largely automated, applying greater intelligence to operate, monitor and even heal itself. This smart grid will be more flexible, more reliable and better able to serve the needs of a digital economy.

2.1 Smartness of the Grid There is a great deal of variation both within the power industry and outside it as to what exactly should be included under the idea of a smart grid. Ask a room full of utility professionals to define the term and youre likely to get a wide range of answers. Similarly, most consumers would likely associate smart meters or home automation with the concept of a smart grid, but there is much more to the picture. Simply put, a smart grid is the integration of information and communications technology (ICT) into electric transmission and distribution network. The smart grid would deliver electricity to the consumer using two way digital technology to enable the more efficient management end use of electricity as well as the more efficient use of the grid to identify and correct supply demand embalances instantaneously and detect fault in self healing process so as to improve service quality , enhance reliability and reduce cost. Following may be called the seven defining traits of what a smart grid will do:

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1) Optimize asset utilization and operating efficiency. 2) Accommodate all generation and storage options. 3) Provide power quality for the range of needs in a digital economy. 4) Anticipate and respond to system disturbances in a self-healing manner. 5) Operate resiliently against physical and cyber attacks and natural disasters. 6) Enable active participation by consumers. 7) Enable new products, services, and markets. However a fully developed smart grid concept goes far beyond smart meters. It includes technologies at both the transmission and distribution level and extends to both IT hardware and software, such as monitoring and control systems, as well as primary equipment like transformers and relays. It must also be Adaptive, with less reliance on operators, particularly in responding rapidly to changing conditions. Predictive, in terms of applying operational data to equipment maintenance practices and even identifying potential outages before they occur. Integrated, in terms of real-time communications and control functions. Interactive between customers and markets. Optimized to maximize reliability, availability, efficiency and economic performance. Secure from attack and naturally occurring disruptions. 2.2 Drivers for the Smart Grid:

Six factors will drive the adoption of the smart grid in India: Supply shortfalls: Demand, especially peak demand, continues to outpace Indias power supply. The increasing affordability of household appliances is adding to the burden on the grid. Managing growth and ensuring supply is a major driver for all programs of the Indian power sector. Loss reduction: Indias aggregate technical and commercial losses are thought to be about 25-30%, but could be higher given the substantial fraction of the population that is not metered and the lack of transparency. While a smart grid is not the only means of reducing losses, it could make a substantial contribution. Managing the human element in system operations: Automated meter reading would lower recording and other errors including what are known elsewhere as curbstone readings or shade tree readings or even deliberate errors, which are thought to be significant reasons for losses. Peak load management: Indias supply shortfalls are expected to persist for many years. A Smart Grid would allow more intelligent load control, either through direct control or economic pricing incentives that are communicated to customers in a dynamic manner. Such measures would help mitigate the supply-demand gap.

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Renewable energy: India has supported the implementation of renewable energy. Historically, much of its support was for wind power, but the newly announced National Solar Mission and its goal to add 20,000 MW of solar energy by 2020 should be an accelerant. Spurred by environmental concerns and the desire to tap into all available sources of power, this move can also be a smart grid driver. Technological leapfrogging: Perhaps the most intriguing driver for India is the potential to leapfrog into a new future for electricity, as it did with telecommunications. Also, the Smart in a Smart Grid is ICT an area of unique capability in India. 2.3 Current Grid and smart Grid The Smart Grid differs from the conventional grid that we see today in many aspects some of which are mentioned below:

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2.4 Smart Grid Realization: As said before, smart grid is much a vision as a blue print. Success of smart grid will entirely depend upon technology that is going to be used for its realization. Hence, realization of smart grid will mainly depend upon technologies of communication, metering, integration of renewable energy etc.

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2.4.1 Synchrophasor Monitoring: Most monitoring of the grid is based on non-simultaneous average values of measurements taken over a period of several seconds. This is valuable in assessing the steady-state condition of the grid. The monitoring of line voltage phase angles (phasors) can fill that gap, providing the instantaneous measurement of electrical magnitudes and angles that can reveal emerging instability. The deployment of phasor measurement units (PMUs) is growing, along with the development of predictive algorithms that can assess system risk. For example, the Center for Energy Advancement through Technology Innovation has initiated a project to directly input phasor data into an ultra-fast load flow to identify thermal overloads, voltage constraints, and voltage instabilities. Reliable broadband communication channels are needed to accommodate the system-wide deployment of this tool. Source: National Energy Technology Laboratory, The Transmission Smart Grid Imperative, developed for the US Department of Energy Office of Electricity Delivery and Energy Reliability, September 2009. Structure of Real Time Wide Area Phasor Measurement System:

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2.4.2 Intelligent Electronic Devices: Utilities have used electromechanical devices such as land lines and power line carriers for many years. But today, many of these devices are taking on enhanced, and even new, features and functions in the form of intelligent electronic devices (IEDs). For example, the old single-function electromechanical meters have given way to multi-function electronic meters that can communicate with a central computer. Also, the addition of electronics to the control units of reclosers has enabled them to communicate with a utilitys central computers, which automatically store the outage data (e.g., number, duration) needed for reliability and availability indices (SAIDI, CAIFI, SAIFI, etc.). Remote terminal units (RTUs) for supervisory control and data acquisition systems (SCADA) are smaller and less expensive than before. For this reason, the use of SCADA RTUs is expanding out from the transmission system to the distribution system. Modern digital relays perform the detection and tripping algorithms that were impossible to implement with electromechanical relays. These relays have hundreds of set points and a broad range of storage history. While this can be addressed with internet protocols, relays still require ongoing operational technology to manage security, firm-ware changes, configuration changes, maintenance, health checks, version control, compatibility testing, and more. Thus, the enterprise information management system must evolve for relays. Some of the advances India is making in the area of intelligent electronic devices include: The Restructured-Accelerated Power Development and Reforms Program (R-APDRP) is stimulating progress toward 100% metering on distribution transformers and feeders. The conversion from electromechanical to static (electronic) metering is progressing at the low-tension level (400/220 Volts) to residential and small commercial customers. The Bureau of Indian Standards is scheduled to issue a standardized meter protocol in March 2010 to address meter interoperability. The Meter Inter-Operability Solution being promoted by the Indian Electrical and Electronics Manufacturers Association and Device Language Message Specification are also gaining ground. Although meter data acquisition and management are still within the purview of meter vendors, which is hindering the interoperability of the products of different meter suppliers, R-APDRP is working on a holistic approach to meter data management.

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2.4.3 Smart Meter Since the inception of electricity deregulation and market-driven pricing throughout the world, looking for a means to match consumption with generation is very much essential. Traditional electrical meters only measure total consumption and as such, provide no information of when the energy was consumed. Smart meters provide an economical way of measuring this information, allowing price setting agencies to introduce different prices for consumption based on the time of day and the season. Electricity pricing usually peaks at certain predictable times of the day and the season. In particular, if generation is constrained, prices can rise from other jurisdictions or more costly generation is brought online. It is believed that billing customers by how much is consumed and at what time of day will force consumers to adjust their consumption habits to be more responsive to market prices. Regulatory and market design agencies hope these "price signals" will delay the construction of additional generation or at least the purchase of energy from higher priced sources, thereby controlling the steady and rapid increase of electricity prices. The implementation of advanced meters which are capable of collecting interval data and remotely communicate with meter data agencies is a major part of implementing a smart grid. The Advanced Metering Infrastructure will allow electricity to be charged according to demand based tariffs. The smart meter thus has a capability of two way communication. Following fig shows a comparison between a present meter and a smart meter. Similar meters, usually referred to as interval or time-of-use meters, have existed for years, but Smart Meters usually involve a different technology mix, such as 1) Real-time or near real-time sensors and real time pricing 2) Power outage notification 3) Power quality monitoring 4) Peak demand rates, etc. Smart meters are also believed to be a less costly alternative to traditional interval or time-of-use meters and are intended to be used on a wide scale with all customer classes, including residential customers. Interval and time-ofuse meters are more of a legacy technology that historically have been installed to measure commercial and industrial customers, but typically provide no AMR (Automated Meter Reading) functionality. Smart meters may be part of a smart grid, but alone do not constitute a smart grid. A smart grid replaces analog mechanical meters with digital meters that record usage in real time. Smart meters are similar to Advanced Metering Infrastructure meters and provide a communication path extending from

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generation plants to electrical outlets (smart socket) and other smart gridenabled devices. By customer option, such devices can shut down during times of peak demand. 2.4.4 Home Automation and HAN (Home Area Network) a) Home Automation Home automation technologies are viewed as integral additions to the Smart grid. It is automation of the home, housework or household activity. Home automation may include centralized control of lighting, HVAC (heating, ventilation and air conditioning), appliances, and other systems, to provide improved convenience, comfort, and energy efficiency. Also Smart Grid applications (load shedding, demand response, real-time power usage and price reporting) will become vital in Home Automation. Green Automation is the term coined to describe energy management strategies in home automation when data from smart grids is combined with home automation systems to use resources either at there cheapest prices or most available. For example, taking advantage of high solar panel out put in the middle of the day to run washing machines automatically. Home automation can also provide a remote interface to home appliances or the automation system itself, via telephone line, wireless transmission or the internet, to provide control and monitoring via a smart phone or web browser. In Smart Grid application, every home, buildings, cars etc are supposed to consume electricity whenever needed and that to when system is lightly loaded and supply to the grid back when the grid is heavily loaded to match the load generation balance. Household solar or wind energy generator is supposed to grid the excess energy or store the same using high capacity batteries whichever preferable depending upon the system conditions. b) HAN (Home Area Network) For all these applications, the home appliances, smart meters and grid should be able to communicate with each other. Depending upon grid conditions the appliances would work and for critical or important applications, the generating units will increase the input to the grid using signals through smart meters. The required communication and power flow is shown below. Many companies are also developing Home Area Network (HAN) technology which will enable consumer to remotely connect to and control many automated digital devices throughout his house. For example, using a cell phone or computer to switch appliances on or off, arm a home security system, control temperature and lighting, or program a home entertainment system. In the future, smart meter will integrate with HAN and communicate peak energy use times to digital devices. For example, on a hot day, a smart meter would send a signal and the smart devices would, based on the preferences, reduce energy use during a call for conservation. HAN could automatically turn

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devices on or off, up or down, and shift the smart appliances to an economy mode based on how the consumer want to conserve energy. The smart meter infrastructure of today will help optimize the smart devices of tomorrow. In a typical US home, consumer electronics devices now consume over half the power. Accordingly, the ability to shut down or hibernate devices when they are not receiving data could be a major factor in cutting energy use, but this would mean the electric company has information on whether a consumer is using their computer or not. Other key devices that could aide in the utilities efforts to shed load during times of peak demand include air conditioning units, electric water heaters, pool pumps and other high wattage devices. 2.4.5 Integration of Renewable Energy & Storage Renewable energy is fundamentally changing the electricity industrys strategic landscape. Renewables are the fastest growing energy resource, and some projections indicate that by 2030, renewables could account for more than 20% of the electricity generated and delivered globally. Renewable portfolio standards, financial incentives, concerns over energy security, and efforts to reduce greenhouse gas emissions will continue to drive renewable energy deployment. The growth of renewable poses three main challenges for the electricity industry: Enabling renewable generation technology options that are costcompetitive long term with other low-carbon forms of generation Maintaining electric grid reliability with high penetrations of variable wind and solar energy Understanding and minimizing environmental impacts of renewable energy resources on a large scale Smart grid concept includes the solution for grid reliability with increasing number of renewable energy use through concept integration of renewable energy. The rapid deployment of renewable energy technologies and their larger deployment in the near future, raise challenges and opportunities regarding their integration into energy supply systems. Energy systems are needed to meet the demands for a broad range of services (household, commerce, industry, and transportation needs). Energy systems include an energy supply sector and the end-use technology to provide the aforementioned energy services. The electricity supply system is mainly composed of large power units, mostly fossil fuelled and centrally controlled, with average capacities of hundreds of MW. Renewable energy sources are geographically widely distributed and if embedded in distribution networks are often closer to the customers. Locating renewable and other generators downstream in the distribution network is known as Distributed Generation . Distributed generation involves the use of small, modular electricity generation units close to the point of consumption. In the power sector, utilities have limited experience of inter connecting numerous small scale generation units to their distribution

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networks, and the possible level of renewables penetration depends strongly on the existing electrical infrastructure. Distributed electricity generation, close to the end customer, differs fundamentally from the traditional model of an energy system consisting of large power stations generating centrally controlled power. The approach is completely new, replacing the concept of economy of scale using large units by economy of numbers using many small units. Far from being a threat, distributed generation based on renewable energy offers opportunities. Bringing on land the power produced from a large offshore wind farm is(economically) only possible where sufficient electricity grid capacity is available. In some specific locations, a new electricity infrastructure has been set up with the specific purpose of providing very high penetration levels, up to 100% electricity from renewables. Additional transmission infrastructure will be required to move power from areas in which renewable resources are concentrated to the load centers. Also, transmission systems must reduce the overall variability by aggregating and averaging local variable generation over large geographic areas. System planning must expand beyond traditional service territories to work both regionally and inter- regionally. Capacity planning will need to cover not only maximum load scenarios, but also lowand shoulder-load scenarios that might present higher reliability risks than in the past. It will also be necessary to increase the flexibility of the power system to respond to more variability and uncertainty. The potential exists for this flexibility to come from both conventional generation and new sources such as controlled smart charging of electric vehicles, energy storage, and additional system coordination. Wind and solar generation resources themselves will have to provide flexibility, including the capability to limit ramp rates, curtail output when needed, and emulate other reliability functions such as inertia and frequency response that have traditionally been provided by synchronous generation. Distributed renewable resources will need to ensure effective management of feeder voltage maintenance and reverse power management. Reduce the transmission and distribution losses as well as transmission and distribution costs. Provide customers with continuity and reliability of supply Stimulate competition in supply, adjusting prices via market forces Be implemented in a short time due to the modular nature of Renewable Energy Integration and Storage Integration of renewable energy not only includes distributed generation and advanced transmission grid but also it needs battery system which can be used as back up during emergency. This need is satisfied by PEV i.e. plug-in electric vehicle

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Electric vehicles: The Smart Grids single biggest potential for delivering carbon savings is in providing cost-effective and increasingly clean energy for plug-in electric vehicles (PEVs) and their hybrids. PEVs can be plugged into a standard household electrical outlet to recharge their batteries. Capable of travelling up to 40 miles in electric-only mode, the majority of PEVs operating on battery power would meet the daily needs of most drivers. Compared with a current hybrid, a PEV with an electric-only range of 20 miles could reduce fuel use by about one-third according to a report by the American Council for an Energy-Efficient Economy. The Electric Power Research Institute estimates that the same PEVs could reduce fuel consumption by about 60% compared with non-hybrid vehicles. The technology is still expensive, mainly due to the cost of batteries, but the US Government is supporting the development of storage technology. An increase in production volumes would also help lower unit costs. An intriguing addition to the potential of PEVs is that, while most of the discussion up to now has centred on plugging the (electric) car into the house, there is a nascent but growing discussion about plugging the house into the car. In other words, the collective storage capacity of PEVs could serve as reserve storage capacity for a micro-grid to help balance an unanticipated outage or shortfall in supply. From above section it can be concluded that, integration of renewable energy in electric system can be achieved through smart grid by using distributed generation system, advanced transmission grid and strong battery back up (PEV). 2.4.6 Development of Micro Grids: A micro grid is a localized grouping of electricity generation, energy storage, and loads that normally operate connected to a traditional centralized grid (macro grid). This single point of common coupling with the macro grid can be disconnected. The micro grid can then function autonomously. Generation and loads in a micro grid are usually interconnected at low voltage. From the point of view of the grid operator, a connected micro grid can be controlled as if it was one entity. Micro grid generation resources can include fuel cells, wind, solar, or other energy sources. The multiple dispersed generation sources and ability to isolate the micro grid from a larger network would provide highly reliable electric power. By-product heat from generation sources such as micro turbines could be used for local process heating or space heating, allowing flexible trade off between the needs for heat and electric power. Distributed energy resource (DER) systems are small-scale power generation technologies (typically in the range of 3 kW to 10,000 kW) used to provide an alternative to or an enhancement of the traditional electric power system. The usual problems with distributed generators are their high costs. Distributed energy systems may include the following devices/technologies: Combined heat power (CHP)

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 Fuel cells Micro combined heat and power (Microchip) Micro turbines Photovoltaic Systems Reciprocating engines Small Wind power systems Sterling engines A Micro Grid is an integrated energy system consisting of interconnected loads and distributed energy resources which as an integrated system can operate in parallel with the grid or in an intentional island mode. At the same time a Micro Grid is NOT: One Micro turbine in a commercial building A group of individual generation sources which are not coordinated A load or group of loads which cannot be separated from the grid or controlled. A Micro Grid normally has a CHP generation. To effectively implement the concept of Micro Grid challenges are aplenty. Technical, Market and Regulatory Challenges: Micro Grids could be built with current technology but the cost involved is a constraint. How would a Micro Grid be integrated into Main Grid? What parameters would define the mode of operation of a Micro Grid? Evolving of a standard and individual technology platform is crucial. The regulatory body would require spelling out guidelines regarding the ownership structures of these micro grid energy providers. A separate set of rules would be applicable to grid depending on its operational mode. There would also be a need for coordinated but decentralized energy trading and management. A market mechanism would have to be developed which would ensure efficient, secure and reliable energy supply and demand balancing. There should also be a development of separate islanded and grid connected price based energy and ancillary services mechanisms. The role of stakeholders involved for this project is very important. Different stakeholders are 91

 Network Operators Municipality of the area to which the grid would cater, End users Generation equipments manufacturers and Suppliers Metering and Energy box technology suppliers Facility management firms Weather services Environment Consultants, Universities and Research Institutes I.T. infrastructure providers and Funding Organizations. 3. ECONOMIC CONSIDERATION AND BARRIERS IN FINANCING

In previous section main concentration was on realization of smart grids through technical aspects. This section elaborates economics of smart grid along with regulatory aspects. The poor balance sheets of many electric utilities, coupled with the lack of an efficient procurement and project management culture at most State Electricity Boards, has resulted in inadequate investments in state transmission and distribution systems. In addition, many of the utilities that are undertaking projects under the Restructured Accelerated Power Development and Reform Programme, RAPDRP; lack experience which spans the full project cycle, from formulation to appraisal, procurement, construction supervision and commissioning. As a result of the lack of automation (computerization and telecommunications) in their businesses, the distribution companies also have a serious skills deficit in information and communications technology (ICT). The barriers to implementing smart grid concepts in India are much the same as the barriers that have slowed power sector reform since market liberalization was first announced almost 20 years ago. The initiatives taken by the Ministry of Power, GoI, in 1991 to allow private players into generation, were received with lots of hope of improving the electricity scenario in the country. But the inability of the state utilities to pay for the power proved to a dampener. With the government already running severe losses on its current power subsidies, the additional cost of moving to a smart grid will be problematic. If there are only limited fiscal benefits from smart grid investments in the short term, it will be a challenge to get a commitment for significant additional funds from the government. Hence, innovative financing alternatives will have to be explored. Some possible avenues for funding include a combination of grants, selffunding, and public-private partnerships. Ultimately, however, the widespread

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implementation of a broad interpretation of the smart grid vision may be held back by the sectors lack of commercial viability. In India, smart grid projects will be subject to the same issues that face conventional utility capital projects. Cost-benefit methodologies have been established for energy efficiency and renewable energy projects, and these can serve as a starting point for determining the viability of smart grid projects. 3.1 Cost-Benefit Analysis Although many countries have been discussing the concept of a smart grid for several years, projects are only now beginning to move forward. The suggested cost-benefit analysis methodology described here has three main objectives: Develop a common cost-benefit methodology that can be applied across all smart grid demonstrations (approved by financing sources and regulators) Publish an agreed upon methodology, including underlying rules and assumptions Ensure that the methodology can easily accommodate changes and expansion. In order to work out the engineering economics of smart grid projects, one needs to consider various scenarios with selected elements being implemented in a phased manner. While still new enough to lack a universally agreed upon definition, some typical project components of a smart grid include: Smart power meters featuring two-way communications between consumers and power providers to automate billing data collection, detect outages, and dispatch repair crews to the correct location faster. Smart measurement and metering also often embrace smart substation and smart distribution (together known as distribution automation). Collectively, these elements represent the de facto core of most programs that are being proposed or implemented. Smart Substations include the monitoring and control of critical and noncritical operational data such as power factor performance, security, and breaker, transformer and battery status. Smart Distribution is self-healing, self-balancing and self-optimizing, including superconducting cables for long-distance transmission, and automated monitoring and analysis tools capable of detecting or even predicting cable and other failures based on real-time data on weather, outage history, etc. Universal access to affordable, low-carbon electrical power generation (e.g., wind turbines, concentrating solar power systems, photovoltaic panels) and storage (e.g., in batteries, flywheels or supercapacitors or in plug-in hybrid electric vehicles).

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 Intelligent appliances capable of deciding when to use power based on pre-set customer preferences. This can go a long way toward reducing peak loads, which has a major impact on electricity generation costs by alleviating the need for new power plants and cutting down on damaging greenhouse gas emissions. Early tests with smart grids show that consumers can save up to 25% on their energy usage by simply providing them with information on that usage and the tools to manage it. 3.1.1 Cost analysis The typical costs associated with the smart grid are categorized according to the elements and functions they provide. The major cost items are: Cost of project design and feasibility studies Cost of program management Cost of setting up infrastructure to enable two-way communications between the consumer and the utility; this will include the costs of the communications medium (e.g., fiber optic, PLC), installing sensors, monitoring equipment, and software, and an online tracking mechanism Cost of purchasing and installing the smart meters Costs for in-home devices and customer information systems Training and development of key staff. However, from the estimated cost the total capital invested tends to vary from Rs 1250 to Rs 3000 per meter installed . It is notable that the range provided by utilities is wide and hence estimating a reasonable cost based on this range is not prudent. Some key variables that can have a major impact on costs are also worth noting: Size of the project, which is determined by the number of transmission and distribution lines in the grid, and number of buildings to be covered Strength and compatibility of the existing infrastructure, if the project is not a green field project 3.1.2 Benefits analysis: The move to a smarter grid promises to change the power industrys entire business model and its relationship with all stakeholders, involving and affecting utilities, regulators, energy service providers, technology and automation vendors, and all consumers of electric power. Who benefits from the Smart Grid? WHO HOW Customers Cost reduction Increased empowerment Utilities Better efficiency between energy generation and consumption Increased operation efficiency Improved delivery of energy Delivery of differentiated services 94

Telecoms

New revenue opportunities Network Optimisation Society Reduction in GHG Shifts in societal behaviour of energy consumption Government Energy security and energy independence The smart grid envisages providing choices to every customer and enabling them to control the timing and amount of power they consume based upon the price of the power at a particular moment of time. Some basic economic benefits of a smart grid are: 3.2 Economic benefits:

Five types of economic benefits can be derived from the smart grid. Cost savings from peak load reduction: Smart grids bring about a reduction in per-unit production costs due to demand response / load management programs. Reductions in capacity costs: These can be attributed to residential customer reductions in demand during the 50 to 100 hours of highest system demand each year (critical peak periods) in response to some form of dynamic pricing, either peak time rebates or critical peak pricing. Deferred capital spending for generation, transmission, and distribution investments: By reducing peak demand, a smart grid can reduce the need for additional transmission lines and power plants that would otherwise be needed to meet that demand. Reduced operations and maintenance costs: Smart grid technologies allow for remote and automated disconnections and reconnections, which eliminate unneeded field trips, reduce consumer outage and high-bill calls, and ultimately reduce O&M costs. Reduced costs can also result from near real-time remote asset monitoring, enabling utilities to move from time-based maintenance practices to equipment condition-based maintenance. Reduced industrial consumer costs: Industrial and commercial consumers could benefit significantly from a smart grid. Electric motors account for about 65% of industrial electricity usage because they power virtually every moving process necessary for process industries, including power generation, oil and mining extraction, and pharmaceuticals, as well as for the compression and pumping needed for heating and cooling buildings. Motors are also essential to Indias growing manufacturing sector for automobiles and other products. Small improvements in motor efficiency can generate significant savings in energy costs, but more sophisticated motors require higherquality power.

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3.3

Calculating project costs and benefits

The methodological approach for calculating smart grid project costs and benefits has several steps: Identify the assets/elements that are deployed for the smart grids systems Assess the principal characteristics of the smart grid; each will have one or more metrics that are reflected in the project Identify, from a standardized set, the smart grid functions that each project element/asset could provide and what will be demonstrated Estimate benefits Map each function onto a standardized set of benefit categories Define the project baseline and how it is to be estimated Identify and obtain the baseline and project data needed to calculate each type of benefit Quantify the benefits Monetize the benefits Estimate the relevant, annualized costs Compare costs to benefits 3.4 Estimating Technology Costs for a First Time Implementation

Five major types of technology costs will be incurred for a first-time implementation of a typical smart grid project: Integrated communications include data acquisition, protection, and control, and enable users to interact with intelligent electronic devices in an integrated system. Sensing and measurement technologies support acquiring data to evaluate the health and integrity of the grid. They support automatic meter reading, eliminate billing estimates, and prevent energy theft. Advanced components are used to determine the electrical behavior of the grid and can be applied in either standalone applications or connected together to create complex systems such as Micro Grids. The success, availability, and affordability of these components will be based on fundamental research and development gains in power electronics, superconductivity, materials, chemistry, and microelectronics.

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3.5

Benefits of Smart Grid:

Benefits of smart grid can be divided into three 1. Economical 2. Service 3. Environmental 3.5.1 Economic benefits: Five types of economic benefits can be derived from the smart grid. Cost savings from peak load reduction: Smart grids bring about a reduction in per-unit production costs due to demand response / load management programs. Reductions in capacity costs: These can be attributed to residential customer reductions in demand during the 50 to 100 hours of highest system demand each year (critical peak periods) in response to some form of dynamic pricing, either peak time rebates or critical peak pricing. Deferred capital spending for generation, transmission, and distribution investments: By reducing peak demand, a smart grid can reduce the need for additional transmission lines and power plants that would otherwise be needed to meet that demand. Reduced operations and maintenance costs: Smart grid technologies allow for remote and automated disconnections and reconnections, which eliminate unneeded field trips, reduce consumer outage and high-bill calls, and ultimately reduce O&M costs. Reduced costs can also result from near real-time remote asset monitoring, enabling utilities to move from timebased maintenance practices to equipment condition-based maintenance. Reduced industrial consumer costs: Industrial and commercial consumers could benefit significantly from a smart grid. Electric motors account for about 65% of industrial electricity usage because they power virtually every moving process necessary for process industries, including power generation, oil and mining extraction, and pharmaceuticals, as well as for the compression and pumping needed for heating and cooling buildings. Motors are also essential to Indias growing manufacturing sector for automobiles and other products. Small improvements in motor efficiency can generate significant savings in energy costs, but more sophisticated motors require higher-quality power. 3.5.2 Service benefits: The smart grid will bring benefits to residential, commercial, and industrial consumers alike:

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 Improved reliability: A smart grid enables significant improvements in power quality and reliability. Smart meters will allow utilities to confirm more easily that meters are working properly. Two-way communications all across the grid will let utilities remotely identify, locate, isolate, and restore power outages more quickly without having to send field crews on trouble calls. A smart grid 50 The Smart Grid Vision for Indias Power Sector could eliminate up to 50% of trouble calls in a mature power sector. Increased efficiency of power delivery: Up to a 30% reduction in distribution losses is possible from optimal power factor performance and system balancing. Today, this problem is managed to some extent by controlled or automated capacitor banks on distribution circuits and in substations. But the control of these devices can be greatly improved with better real-time information through a smart grid. Consumption management: Smart grid technologies offer consumers the knowledge and ability to manage their own consumption habits through inhome or building automation. Advanced meters tell consumers how energy is used within their home or business, what that usage costs them, and what kind of impact that usage has on the environment. They can manage their usage interactively or set preferences that tell the utility to automatically make adjustments based on those choices. Improved system security: Utilities are increasingly employing digital devices in substations to improve protection, enable substation automation, and increase reliability and control. Enhanced business and residential consumer service: The smart grid will allow automatic monitoring and proactive maintenance of end-use equipment, which can be an avenue for energy savings and reduced carbon emissions. Equipment is sometimes not properly commissioned when it is first installed or replaced. With the two-way communications of a smart grid infrastructure in place, a utility could monitor the performance of major consumer equipment through advanced interval metering and onpremise energy management control systems. The utility would thus be able to advise the consumer on the condition of specific facilities. 3.5.3 Environmental benefits: According to recent studies, the smart grid can reduce emissions at a lower cost than many of the newest clean energy technologies. There is a broad consensus that smart grid deployments will provide environmental benefits, including significant reductions in greenhouse gas emissions. It has projected that by 2030, the implementation of a smart grid across the United States would reduce annual greenhouse gas emissions by 60-211 metric tons of carbon dioxide equivalent compared to business as usual. This is equal to 2.5 to 9% of the greenhouse gas emissions of the US in 2006. The smart grid will reduce emissions in four ways:

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 Enabling the integration of clean, renewable generation sources Reducing the electrical losses Increasing the penetration of distributed energy resources Increasing energy conservation through feedback to consumers More specifically, emission reductions will come from: Expanded renewable resource integration, enabled by a smart grid through its plug and play capability. Reduced transmission and distribution electrical losses, as generation is placed closer to the load, load curves are flattened, flow patterns are optimized, more efficient components are deployed, and as power quality (e.g., harmonics and The Smart Grid Vision for Indias Power Sector phase balance) are improved. Reduced losses translate to a corresponding reduction in gross generation, and hence, less emissions. Improved central generation efficiency, as units face flatter load curves. Increased penetration of distributed energy resources, including combined heat and power, and plug-in hybrid electric vehicles. These resources could provide fine-tuned support for the grid and ancillary services to increase efficiency and reduce energy-consuming spinning reserves. Increased conservation, as software provides feedback information about emissions to the marketplace and customers. This will also encourage consumers to invest in energy efficiency and demand response options to save money. Reductions in other major pollutants (e.g., nitrous and sulfur oxides, particulate matter, ozone) due to conservation and the use of cleaner energy sources. Increasing transparency in electricity prices to help consumers understand the true cost of electricity by time of day. Giving continuous feedback on electricity use could reduce annual CO2 emissions by 31114 million metric tons of CO2 equivalent in 2030 as consumers adjust their usage in response to pricing and consumption information. Electrical Vehicles: Another concept that is incorporated in smart which will also help in reduction of carbon footprint is PEV i.e. plug- in electric vehicles. Even though this technology is in initial stage but when it will be applied at that time along with smart grid it will considerably reduce carbon footprint. Electrical vehicle concept is in detail explained in Integration of renewable energy section.

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4. Regulatory and Social Pressures Much of the potential benefit attributed to the smart grid hinges on the effectiveness of TOU (Time of Use) rates. Also CBA (Cost Benefit Analysis) depends upon TOU rates. The issue may arise because customers maybe against this TOU tariff. Thus, social pressure may arise because of such interdependent overlapping issues. Smart grid will revolutionize the electricity business and forever change the business model that has been in place for the past 75 years and more. Although the extent of the coming transformation is difficult to predict, there is little question that much will have to change. Existing energy laws and regulations that address technical (e.g., reliability, service standards), economic (reasonable and economically efficient tariffs) and customer service issues were developed for a closed system that is now changing. Thus, regulations may have to be expanded and augmented to encourage innovation and provide incentives to adapt to a new paradigm and new market rules. The economic model for the electric industry is still (mostly) based on maximizing revenue by maximizing the volume of electricity sales. As with demand-side management (DSM) initiatives several decades ago, this may put the increased emphasis on energy efficiency to be accomplished through a smarter grid, in conflict with a utilitys bottom line. Of course, that assumes distribution companies are successful in reducing the extraordinary loss levels that are a more immediate and more potent threat to the financial viability of Indias discoms. One serious practical problem is that it is difficult for customers to judge the value of something they cant envision. That has always been the case. This is equally true for policy makers, regulators and utility managers. Thus, education and capacity building will be essential enabling preconditions. Utility managers and regulators may have to deal with the unique challenge of cost recovery of significant asset values where the actual experience differs greatly from the assumed technological and economically useful life. Deployment of smart grid technology will be piecemeal and utilities that do not install smart meters will still need to install conventional meters. This clearly establishes the risk of creating stranded assets, as the smart roll-out could make them redundant before the end of their asset life. Financial resources: The business case for a self-healing grid is good, particularly if it includes societal benefits. But regulators will require extensive proof before authorizing major investments based heavily on societal benefits. Government support: The industry may not have the financial capacity to fund new technologies without the aid of government programs to provide incentives for investment. The utility industry is capital-intensive, but has been sustaining exorbitant losses due to thefts and subsidization.

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Compatible equipment: Some older equipment must be replaced as it cannot be retrofitted to be compatible with smart grid technologies. This may present a problem for utilities and regulators since keeping equipment beyond its depreciated life minimizes the capital cost to consumers. The early retirement of equipment may become an issue. Speed of technology development: The solar shingle, the basement fuel cell, and the chimney wind generator were predicted 50 years ago as an integral part of the home of the future. This modest historical progress will need to accelerate. Lack of policy and regulation: No defined standards and guidelines exist for the regulation of smart grid initiatives in India. Capacity to absorb advanced technology: Most discoms have limited experience with even basic information and communications technology and, as a result, they have weak internal skills to manage this critical component of smart grids. R-APDRP aims to provide some redress, but it is relatively recent and has not yet had a major impact on the industry. The industrys reluctance to implement ICT appears to have been a by-product of a desire to avoid transparency, especially in meter-billing-collection processes. Now, the lack of automation and the heavy dependence on outsiders for ICT know-how is an unavoidable penalty for any effort to implement a smart grid vision. This suggests that 1) policy makers actively discourage the organizational culture that fostered a lack of transparency, 2) recruiting and capacity building in these areas should be accelerated, and 3) partnerships with leading Indian ICT organizations should be considered as a means to accelerate implementation of smart grid concepts. Consumer education: Customer response is the phrase used to describe the reaction of customers to the new features and functionality enabled by the smart grid. If, for example, a company installs advanced metering and two-way communication along with time-of-use rates, the question is Will customers use it? If there arent enough customers who use the features, the benefits of a smart grid will not be achieved. Thus, two critical and often overlooked components of a smart grid implementations are: 1) sufficient marketing analysis and product design to optimize the likelihood that customers will use the new technology, and 2) an education, communication and public relations program aimed at creating an understanding of smart grids, the associated benefits and the potential implementation issues. The program should be aimed at customers but also policy makers, opinion leaders, regulators and financial institutions. Cooperation: The challenge for diverse State utilities will be the cooperation needed to install critical circuit ties and freely exchange information to implement smart grid concepts.

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Cost assessment: Costs could ultimately be higher than projected because the standards and protocols needed to design and operate an advanced metering infrastructure are still in a state of flux. Thus, investments made now, before the standards are settled, have a higher risk of obsolescence. Failure to include estimates of the costs for the control equipment customers will install to automate their response to time-differentiated pricing could put smart grid investments at risk. Other risks include 1) no demonstration that the proposed project is more cost-effective than alternative approaches that will achieve the same major energy cost reduction objectives at less cost and 2) exclusion of incremental costs of stranded existing meters (i.e., accelerated depreciation). Rate design: Many utilities are proposing to recover these costs via a customer surcharge. This is not reasonable, based on the view of cost causation, and will have disproportionate adverse impacts on low-usage customers. Consumer protection: Privacy concerns about customer usage data and other personal data are real, but it is not clear how such data will be protected. Also, the installation of smart meters will open the door to remote involuntary disconnection and the use of service limiters, all of which limit customer access to and control over electricity service. Even unfounded concerns about a spy in the house may affect consumer attitudes. Thus, issues related to consumer privacy will likely be submitted to regulators and consumer protection agencies as soon as new technologies are planned. Lack of empirical evidence: Utilities have done a number of pilot projects to test AMI and dynamic pricing on a limited basis, but it is only recently that several US utilities received regulatory approval to deploy AMI and dynamic pricing tariffs on a wide scale. In fact, most of those utilities are still in the process of completing deployment. The absence of robust empirical evidence regarding the performance and economics of AMI and dynamic pricing on a system-wide basis over time is a source of uncertainty over both long-term technical performance and the magnitude of peak load reductions that will actually be sustained in the long term in response to dynamic pricing. According to Anil Razdan, Secretary of Union Power Ministry, Indias power demand is increasing at 8-10% per year. In October 2008, the Smart Grids India Conference was held to discuss the infrastructure needed to modernize the grid and to turn a dumb grid into a smart grid. Indian utilities have been challenged to achieve the ambitious target set by the MOP to provide power to all by 2012. According to California-based Echelon, this will take roughly an investment of $100 billion in technologies for generation, distribution, transmission, and monitoring. New policies will also be needed to encourage innovation, to provide incentives for utilities to pursue energy efficiency, load management and conservation initiatives, to provide incentives to attract private players with 102

appropriate rewards and the assurance of a level playing field and to empower consumers to manage energy usage more effectively. If the promotion of private investment in smart grid investments is deemed to be in the national interest, then a study of innovative financing techniques (e.g., tax incentives, accelerated depreciation,) would be warranted. 5. Super-Conducting Cables & Smart Grids Smart grid leads toward the high energy efficient grid. Superconducting cables are highly energy efficient as practically no losses. Smart grid promotes the green energy. The same purpose is solved by SC cables as require comparatively very less corridor. Smart grid is self healing and highly controllable. High controllability is also achievable using SC cables Least susceptible to the environmental tragedies like storms heavy rains or pollution being underground Also least effect of ambient temperature as it operates on 700 to 730 K always. Hence, greater life as well as reliable operation Even if in case of accidents the nitrogen gas leaks into the atmosphere, no ill effect on any human being as air already contains 74% nitrogen. On the other hand being abundantly available, the gas required for cooling N2 is available at very low cost This shows the significance of superconducting cables in a Smart Grid. Implementation of superconducting cables makes the grid more efficient, highly controllable and green in comparatively lower cost. Thus, using this technology, we will surely make our grid a Smart Grid. In cases where laying of additional lines/cable is no longer feasible superconducting cables will prove to be the best solution. The same earlier cable trench can be used for replaced superconducting cables as they can carry much higher current and no more right-of- way will be needed. Superconductor Electricity Pipelines are uniquely and ideally suited to address all of the requirements to move renewable energy to distant load centers: Highest power capacity Highest efficiency (lowest power losses) of any transmission technology Ideal for very long distances Able to accept power from multiple distributed sources, and precisely deliver power to multiple distributed destinations All underground construction with very small right of way requirement. The following figure shows the comparison between traditional high voltage line corridor requirement and the superconductor cable corridor requirement for the same amount of power transfer

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Cost-effective, high-capacity power delivery: Utilities today face two daunting and interrelated grid management and operation challenge viz: Congestion. Demand for power has begun to outpace the transmission and distribution capabilities and capacity of the existing infrastructure. Environmental and aesthetic concerns: Urban and suburban communities are increasingly opposing infrastructure development initiatives based on concerns over siting and quality-of-life issues. High-capacity, very low impedance superconductor cables are now being deployed in live grid cable projects paving the way for a brighter, smarter, more secure electricity future. With markedly greater power-handling capacity, superconductor cables provide clear locational and environmental advantages. A smart infrastructure solution Superconductor power cables offer numerous advantages over conventional transmission and distribution systems, including Increase reliability and security of power grid: Smart, controllable Superconductor cables can make the power networks in which they are installed self-protecting able to adjust rapidly and automatically to disruptions in power network equipment caused by weather, willful destruction or other factors. Increase power transmission capabilities in existing rights-of-way: Superconductor cables have a very small installed physical footprint, making them easier to site even in dense, older urban areas. Superconductor cables can carry more power than conventional cables. The high ampacity of Superconductor cables allows 3 to 5-times the power for transmission systems and up to 10 times the power for distribution systems to be delivered at equivalent voltage, or equivalent power to be delivered at reduced voltage. For instance, a Superconductor cable operating at 115 kV can have the same MVA rating than a 345 kV cable. This combination of high power capacity and compact size makes Superconductor cables a superior solution in situations where conventional cables and/or overhead lines would be difficult or impossible to site. Reduce or eliminate environmental impacts in new and existing rightsof-way: Underground solutions with Superconductor cables are faster to gain approval than time-consuming overhead installations requiring extensive permitting and environmental impact studies and reviews. In addition, an installation with Superconductor cable can provide the same transfer power capacity as an overhead installation, unlike conventional underground copper cables, which requires multiple circuits and significantly more land use. Superconductor cables can be installed in a narrow trench using low impact methods, eliminating the traffic congestion and run-off concerns associated with conventional cable installations. Superconductor cables contain no oil, eliminating containment issues associated with conventional oil-filled cables. The shielded construction of cold dielectric cables also eliminates external electromagnetic fields common to overhead and underground transmission technologies. 104

Minimize permitting by reusing rights-of-way: Superconductor cables eliminate the need to increase system voltages to increase system capacity, allowing capacity increases in existing permitted rights-of-way. Additionally, cold dielectric cables do not generate external electromagnetic fields (EMF), thus eliminating a major source of concern of impacted abutters. Superconductor cables significantly reduce the disruptions caused by the cable construction and installation activities. Greater control of AC power flow within the grid: Superconductor power cables have significantly lower impedance than conventional cables. This characteristic means that they can be strategically placed in the grid to draw flow away from overtaxed conventional cables or overhead lines, thereby relieving network congestion. Low impedance cables can also provide solutions to grid congestion problems and enable new grid configurations. Superconductor cable offers the ability to control power flows with conventional, proven technology (e.g., series reactors, phase angle regulators). This combination yields market and reliability benefits typically associated with other controllable forms of transmission, e.g., FACTS or DC transmission. Shorten project implementation time - Complete underground solutions faster: Because the permitting cycle can be completed faster, Superconductor cable systems can ease grid congestion more quickly. Lower installation costs than traditional copper-wire cables: Installation of Superconductor cable is significantly easier, thus less expensive, than the installation of conventional cable. Superconductor cable can be installed in a single, narrow trench using commonly available installation equipment, with no conductor spacing requirements because they are thermally independent of the environment. Conventional cables installations require wide conductor spacing (i.e. wide trench) and expensive thermal backfills to control heating of the cable and the ground. In addition, because Superconductor cables can operate at lower voltages, more expensive high voltage equipment and transformation losses can be avoided. With Superconductor cable, utilities may solve power flow problems with shorter circuit lengths, e.g., connecting to the more pervasive 220/110/66 kV system rather than tying back to the more distant EHV backbone transmission system. The SC cables are but still successfully implemented up to around 138 KV voltage level and 154 KV is being in development stages. Power carrying capacities are much higher than those of conventional cables. The important points to be consider here are these cables require additional cooling towers and special type of joints. So construction, operation and maintenance of cooling and jointing chambers is additional important thing needs to be taken into consideration. The locations of the both are discussed later with some practical examples where SC cable projects are successfully implemented. The 138 KV cable can carry a huge power till 800 MVA. Its indeed huge power. 105

Cable structure This warm and cold are classifications because of difference between there operating temperatures. Warm or HTS cables have some significant impedance as well as EMF effect compared to cold cables. Only advantage is comparatively higher operating voltage than cold SC cables and hi current rating than conventional cables. It can be treated as an intermediate cable between cold SC cables and conventional cables. The practically implemented cables are HTS cables only and EMF effect is made very low by providing outer SC sheath grounding. The operating temperature difference is shown in the graph below. For cold SC cables, liquid He (Helium) is used while LN2 (Liquid Nitrogen) is used as a coolant for HTS SC Cables Some specifications: Cable unit length: 100m earlier but now up to 500 m long cable units (66 KV) are available Cooling Stations: Presently, one cooling station per kilometer is an average but target is to have this distance up to 3 km to 5 km. Research is still going on. One Practical Example: The worlds first high temperature superconductor power transmission cable system in a commercial power grid was energized on April 22, 2008 at the Holbrook substation on Long Island, New York, USA. The 138,000 volt (138 kV), 2,000-foot (~609 meter) cable system, the longest superconducting cable in the world, includes three phases connected to the Long Island Power Authoritys (LIPA) grid through six outdoor terminations. It transmits the power up to 574 MW. The Nexans, American Superconductor Corporation (AMSC), Air Liquid, Long Island Power Authority (LIPA) and the Department of Energy (DOE) successfully completed this project.

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Many other HTS cable projects are there either commissioned or yet to be commissioned worldwide. Early practical application of superconducting cables is a global objective, and the cables have reached the verification stage. The applications of the HTS cables are very important in the country like India. Its very important for the power transmission at chicken neck areas. So starting study projects and study the importance and practical feasibility is very much important as the new technology have really a big potential. 6. Conclusion

The smart grid is more than any one technology, and the benefits of making it a reality extend far beyond the power system itself. The transition from the grid we know today to the grid of tomorrow will be as profound as all of the advances in power systems over the last hundred years, but it will take place in a fraction of that time. That said this transition will not be easy. The integration of smart technologies of many different kinds will be essential to a functioning smart grid, and the path to integration is lined with interoperability standards. Realizing smart grids potential will require a new level of cooperation between industry players, advocacy groups, the public and especially the regulatory bodies that have such immediate influence over the direction the process will take. In the end, though, a fully realized smart grid will benefit all stakeholders. -o0o-

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TABLE OF CONTENTS No. 1 2 3 4 5 6 Introduction Funding of Load Despatch Centres Suggested changes in funding methodology for Load Despatch Centres Business model for Load Despatch Centres Capital Expenditure Plans by Load Despatch Centres Systems and Procedures at Load Despatch Centres Topic

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RING-FENCING AND FUNCTIONAL AUTONOMY OF LOAD DESPATCH CENTRES 1. Introduction The statutory provisions in the law as related to System Operators envisage LDCs as powerful, effective and efficient entities in the electricity industry. However laws have to be interpreted and implemented in letter and spirit to achieve the intent. The experience in implementation of open access in transmission and distribution especially in the state sector has revealed serious concerns regarding the functional autonomy and authority of LDCs. A variety of organizational models have been suggested for LDCs ranging from a monolith for all LDCs in the country akin to the All India Services, Independent System Operators (ISOs) and the Transmission System Operators (TSO). Functional autonomy would mean taking decisions without being adversely influenced by extraneous issues originating from the Company Management or any of the market players. The Governments and the ERCs need to encourage and support the LDCs in discharging their functions in an impartial manner as apex bodies. Functional autonomy and authority for LDCs could be ensured through a) Independent governance structure b) Separate accounting c) Adequate number of skilled manpower having high ethical standards and driven by altruistic values d) Adequate logistics/infrastructure 2. Funding of Load Despatch Centres The funding requirements of the LDCs at the regional level were traditionally met by budgetary allocations from the government. At the state level the respective SEB/ STU funded the LDC. Subsequent to the transfer of RLDCs to POWERGRID (CTU) the expenditure of RLDCs was met by contribution from the state utilities based on an adhoc amount decided by CEA. After amendments to the Electricity (Supply) Act 1948 in 1998, the CERC specified the fees and charges payable to RLDCs by the state constituents. Subsequently after the progressive commissioning of the Unified Load Despatch and Communication (ULDC) schemes starting from mid-2002, CERC has directed that the ULDC tariff would also cover the RLDC fees and charges and no separate payment under the latter head was necessary. Regional Load Despatch Centres (RLDCs) were operated by Central Electricity Authority (CEA) through the Regional Electricity Boards (REBs) since 1964. The RLDC expenses were met out of budgetary allocations made by the Central Government. To facilitate new investments in a modern control centre in 1989 the National Power Transmission Corporation (NPTC) was set up with establishment of modern Load Despatch Centres as one of its functions. NPTC was subsequently

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renamed as POWERGRID. The work of engineering modern load dispatch centre sat the state and regional level and the first set of orders for the Northern and Southern Region was placed in January 1998. Simultaneously from 1994-96, the RLDCs were transferred from CEA to POWERGRID. The Electricity Supply Act 1948 did not have any specific provision for payment against RLDC services. In 1996-97, Rs. 14.94 crores was spent on RLDC operations. CEA in July 1998 finalized a base figure of Rs. 12 crores for the year 1996-97 with 10% escalation every year as the expenses that could be reimbursed to RLDCs every year by the state utilities. In mid 1998, the Electricity Supply Act 1948 was amended and RLDCs designated as apex bodies as far as real time operation of the power system was concerned. The Act had specific provisions for RLDC fees and charges. Petition no. 109/2000 filed before the CERC seeking actual expenses incurred as per audited figures for the year 1998-99 and 19992000 with 10% escalation on these audited figures for the subsequent period, was heard in Jan 2001 and the CERC requested CEA to conduct a fresh detailed study for assessing the RLDC expenses for the year 200001 and onward. CEA submitted its report in Sep 2001 and subsequently based on the CEA report and comments from the stakeholders, CERC issued an order dated 22nd March 2002. CERCs order dated 03rd January 2001 (petition no. 109/2000) directed that the approved expenses1 of the RLDC were to be reimbursed by the respective regional constituent SEB or STU in the ratio of their entitlements in central sector generating stations for the sake of simplicity. Later on a single member bench under Sh G. S. Rajamani, Member CERC was constituted to submit recommendations on the matter. The single member Bench submitted its report on 7 th February 2003. CERC order dated 08th May 2003 finally approved the charges to be recovered by POWERGRID from state utilities. No retrospective revision was allowed for the year 1998-99 and 1999-2000 and the CERC approved Rs. 21.52 crores, Rs. 24.52 crores, Rs. 26.16 crores and Rs. 27.9 crores respectively for the years starting from 2000-2001. There was lot of discussions from 1996 to 2003 to convince the stakeholders on the charges incurred in providing the services. The situation was difficult at the state level there was either no unbundling or even after unbundling there was still a single buyer model viz. STU and clear segregation of SLDC charges was not available making the stakeholders difficult to appreciate this service. In the meantime, the modern load dispatch schemes in the Southern and Northern Regions came under commercial operation w.e.f August 2002 and POWERGRID filed tariff petitions before the CERC (petition nos. 83/2002 and 82/2002). In the hearing on 9th August 2002, the Commission in its order dated 13th August 2002 vide para 7, observed

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that ULDC Scheme do not fall within the scope of Section 13 (c) of ERC Act 1998. Subsequently while approving the tariff for NRULDC scheme CERC in its order dated 02nd September 2005 directed that RLDC fees and charges recovered from the regional constituents based on order dated 08th May 2003 should be proportionately adjusted within the ULDC tariff. CERC in its order dated November 2003 in petition no. 48/2003 made provisions for payment of scheduling operating charges to all LDCs involved in facilitating Short-term Open Access in interstate transmission. At the SLDC level the situation of funding is rather opaque as the SLDCs are either part of the STU or the vertically integrated SEB with no separate accounting or balance sheet. Only seven out of twenty three SERC websites surveyed in end June 2008 had a separate SERC order specifying SLDC fees and charges. To ensure functional autonomy, it is very important to have financial independence. Status of declaration of Separate fees and charges for SLDCs

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The Committee recommends that starting 2009-10 all SERCs must ensure separate accounts for the SLDC functions as an immediate first step to ensure ring fencing. For example in Andhra Pradesh, the Andhra Pradesh ERC has issued an elaborate order dated 07th March 2007 on SLDC charges for the period 2007-08 and 2008-09. 3. Suggested changes in funding methodology for Load Despatch Centres Sections 28 (4) and 32 (3) of the Electricity Act 2003 state that LDC may levy and collect such fee and charges from the generating companies or licensees engaged in interstate (for RLDC) and intrastate (for SLDC) transmission of electricity as may be specified by the appropriate commission. However, the Ministry of Power in its Electricity (Removal of Difficulty, sixth order dated 08th June 2005) has dropped generating companies from the above section of the Electricity Act. The revised wordings are as under:

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Levy and collection of fees and charges, for using transmission system. The Regional Load Despatch Centre may levy and collect such fee and charges from the licensees using the inter-state transmission system as may be specified by the Central Commission. The State Load Despatch Centre may levy and collect such fee and charges from the licensees using the intra-state transmission system as may be specified by the State Commission. This Committee recommends that this issue should be reconsidered by the Government in the light of the developments such as Ultra Mega Power Projects (UMPPs), Merchant generators and Independent Power Producers (IPPs), transmission licensees, distribution licensees at state and interstate level, traders involved in long-term sale/purchase. In the reform process it is suggested that all the generating companies, licensees (transmission, distribution and trading) fund the services received from LDCs in an explicit fashion. This could be in the form of a fixed fee for every generating station or entity scheduled; a fee for every revision in schedule sought and a fee for handling the metering and settlement system. Incidentally the fees deposited by the above entities while filing tariff petitions before the Regulatory Commissions is a pass through. These are still deposited upfront by the generating companies, licensees (transmission, distribution and trading) with the regulatory commission rather than the Commission charging this directly from the state utilities. Likewise all the market players and transmission licensees fund the RPC secretariat. A similar arrangement is suggested for SLDCs, RLDCs and NLDC. The APERC order on SLDC fees and Charges referred in Section 1.2 above already mandates recovery of these charges from all generating companies, distribution licensees and trading licensees using the intra-State Transmission Network. 4. Business model for Load Despatch Centres As mentioned in Section 1.2, the ULDC tariff is expected to cover all the expenses incurred by the RLDCs. It might be appreciated that the ULDC tariff serves a limited purpose of servicing the tangible assets created under the ULDC project viz. Supervisory Control and Data Acquisition System (SCADA), Energy Management System (EMS), the associated communication system as well as the auxiliary services like UPS, DG sets and the air conditioning system. These assets are tools for real time monitoring of the grid. A tool cannot be equated with the indispensable services offered by LDC personnel by interpreting the available information with the help of tacit knowledge and experience acquired over the years. The following services provided by LDCs, distinct from ULDC, are statutory in nature or mandated by ERCs.

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a) Operational Planning and studies related to transfer capability, line shutdowns etc. to ensure reliability, which is a public service. b) Real-time operation and responding to emergencies in the grid c) Post despatch analysis of operation and tripping; providing inputs to the different sub-committees at the RPC/State Power Committee (SPC) level (it would not be possible for the sub-committees to deliver in the absence of inputs/analysis from LDCs) d) Metering and Settlement System e) Information dissemination system through periodic reports, exception reports and other grid related data to the stakeholders involving a huge IT infrastructure (different from ULDC infrastructure) f) Feedback to planners, policy makers and regulators To make LDCs financially independent, it is necessary to identify revenue streams, which can strengthen the financial status of LDCs. The business model for LDCs would have to recognize the following three distinct revenue streams, which would all be regulated by the Appropriate Electricity Regulatory Commission. a) Fees and charges for system operation b) Tariff for decision support system and IT infrastructure (currently only ULDC tariff) c) Operating charges for scheduling, metering and settlement for market players. (CERC has already introduced operating charges payable by Open Access customers to LDCs since May 2004) The above charges may be recovered from all generating companies and licensees using the services of LDCs. In addition LDCs could provide value added services (requested studies, manpower development, detailed reports, access to data archives for a fee etc) on chargeable basis. 5. Capital Expenditure (CAPEX) plans by Load Despatch Centres A significant portion of LDC cost arises because the operations are to be carried out round-the-clock requiring adequate redundancy in resources to tide over contingencies. There is a heavy reliance on information technology with components having high obsolescence rate. A few of the applications (such as SCADA/EMS) are offered by a limited number of vendors and costs are high. The modernization of LDCs is a continuous process and the ERCs might direct LDCs to submit their CAPEX plans for a rolling five-year period and approve the same after examining its prudence through public hearings. ERCs may examine CAPEX proposal considering a shorter life cycle of 710 years for such equipment. As a first step the plan for 2009-12 for all LDCs might be submitted and approved by the respective ERCs by 31 st March 2009. SLDCs may take assistance from CTU and RLDCs in preparing such plans.

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a. Separate outlay for Load Despatch Centres Assuming an annual charges of Rs. 1000 crores for all the LDCs in the country by 2012 and an anticipated annual generation of 1000 Billion units by 2012 the cost of system operation services works out to just 1 paisa per unit. This is very low in comparison to the charges for other services in ESI (Table 2 below) and will further go down with increase in volume as system grows. Table 1: Comparison of charges for various services in ESI S No. 1 2 3 4 5 6 7 Services in the ESI Energy charges (for coal fired) Energy charges (for RLNG) Energy charges (for naptha) Inter State Transmission (Long term) Inter State Transmission (Short term) Trading Margin Power Exchange Paise per kWh 100 200 500 600 1000 1500 10 20 39 4 1

Another way of looking at the leverage that could be realized through System Operation is by way of reducing the operation cost in terms of fuel by merit order. Taking only the Inter State Generating Stations (ISGS) and Inter State Transmission Systems (ISTS) business for 2006-07, it could be seen [ Fig. 1] that fixed cost for generation is around 31 %, fuel cost is around 58 % and transmission cost is 8%, transmission losses are 3% whereas the RLDC fees and charges are less than 1%. The percentages would be similar for state level generation and transmission system. The strengthening of LDCs would help in optimizing the expenses of fuel charges and transmission losses, which are 61 %. Thus the total value of the services and the consequential savings to the national economy would far exceed the funds that LDCs would have to spend to provide these services. The Committee recommends that LDCs should be made self-reliant in terms of resources and should have separate outlays for efficient functioning.

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Figure 1: Composition of the annual business volume at the regional level

b. Governance structure The LDCs have to ensure that their actions are non-discriminatory, transparent and not influenced by any market player or any other business activity. Sections 28(2), 28(3) (a) and sections 32(2) (a) of the Electricity Act 2003 provide adequate safeguards in respect of scheduling. The decentralized mode of scheduling adopted in our country ensures minimum subjectivity on the part of LDCs the dispatch decisions. The Indian Electricity Grid Code (IEGC) and State Grid Codes issued by CERC and SERCs respectively provide the basic framework for operation and ensure minimum subjectivity in real time operations. Under Section 37 of the Electricity Act 2003, the Appropriate Government may issue directions to the RLDCs or SLDCs as the case may be. Government could use this provision in a transparent manner for directing the LDCs for taking all such measures as may be necessary for maintaining smooth and stable transmission of supply of electricity. The Appropriate Government must take suitable steps to facilitate the independent functioning of the Load Despatch Centres, in line with the Electricity Act 2003 and the National Electricity Policy.

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Figure 2: Opinion of LDC personnel on importance of ethics in LDC

At the RLDCs/NLDC level, Government of India has already taken a decision for setting up a wholly owned subsidiary of POWERGRID responsible for the independent System Operation of RLDCs and NLDC to ensure ring-fencing and functional autonomy. A similar arrangement could be replicated at SLDC level. Nevertheless, accounting function separation is an essential first step that must be implemented by 31 st March 2009. State Governments may consider a separate representative Board structure to be created, which can be entrusted with the responsibility of System Operation. A Forum of Load Despatch Centres, with secretariat functions being provided by National Load Despatch Centre must be established. This Forum could take up issues of common interest and also formulate a Code of Ethics for the LDC personnel. 6. Systems and procedures at Load Despatch Centres With regard to offline systems there is an urgent need to first integrate the online systems and offline systems operating in islanded mode within the same LDC. Subsequently, the systems in different LDCs have to be integrated with each other. This is essential to streamline operations and enhance the productivity of the workforce. Several mundane and routine activities need to be automated to release manpower for deployment in other areas. The NLDC in consultation with CEA must lay down Standard Operating Procedures (SOPs) for the LDCs. Further, the committee recommends that the systems and procedures adopted at each LDC must conform to ISO 9001, ISO 14001, OHSAS 18001 and an Integrated Management Systems (IMS) must be in place. The LDC of tomorrow would need to be certified for its Quality Management, Environmental Management and Occupational Health and Safety Systems. These systems would also help in harmonizing the systems and procedures adopted by all the LDCs in India.

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TABLE OF CONTENTS Topic Introduction Background General Role of Various Organisations and their linkages Planning code for inter-state transmission Connection Code Operating Code Scheduling & Despatch Code Commissions power to relax

No. 1 2 3 4 5 6 7 8 9

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OVERVIEW OF INDIAN ELECTRICITY GRID CODE 2010 1.0 Introduction The Indian Electricity Grid Code (IEGC) is a Regulation made by the Central Electricity Regulatory Commission (CERC) in exercise of powers of Section 79 and 178 of the Electricity Act 2003. The IEGC lays down the mandatory rules, standards, guidelines to be followed various persons and participants in power system to plan, develop, maintain and operate the power system . Adhering, compliance and implementation of IEGC is NOT an optional but mandatory. IEGC is a supplementary to various provisions of the Electricity Act 2003, Regulations and Standards but NOT a complimentary document. The role of IEGC is to ensure most secure, reliable, economic and efficient power system in India while facilitating healthy competition in generation and supply of electricity. IEGC is a document needs to be well understood and implemented with right interpretation. The attempt made in this study material is to provide a ready reckon ire to the participants in a simplified manner. For implementation of IEGC, all the words, statements and clauses given in the IEGC shall be considered without any addition / omission. The interpretation of meaning of the IEGC clauses shall be made in line with the intended meaning given by CERC through statement of reasons made available by CERC. IEGC 2010 Clause reference Sl.No 1 2 3 4 5 6 7 8 9 ATC / TTC AUFR & df/dt Automatic Demand Management Schemes AVR & PSS Tuning Black Start Restoration / Recovery Procedure Congestion Handling Contingency Procedure for Demand Disconnection Control area demarcation for scheduling responsibilities Compliance of RLDC / SLDC directions and furnishing compliance report Description IEGC Clause Ref 5.3 (h) 5.2 (n) 5.4.2 (d), 5.2 (k) 5.2 (p), 5.8, 5.4 (h), 5.4 (c), 6.4 5.1 (d), 5.3 (c), 5.4.2 (e), (f), (g), 6.4.12,

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10 11 12 13 14 15 16 17 18

Curtailment of Schedule Cyber Security Data & Communication facilities Demand Forecast Demand Management Event Reporting Frequency range for grid operation Grid disturbance Hydro Scheduling

6.5.27, 6.5.28, 6.5.30, 6.5.31 4.6.5 4.6.2, 5.2 (q), 5.3, 6.4.8 5.4, 6.4.7 5.9 5.2 (m) 6.5.17 6.4.24, 6.5.9, 6.5.10, 6.5.11, 6.5.12, 6.5.13, 6.5.14 6.4.26, 6.4.27, 6.5.5 6.4.16, 6.4.17, 6.4.18, 6.4.19, 6.4.20, 6.5.3 6.4.12, 6.4.15 3.5 6.4.5 (iv) 6.4.21, 6.4.22 5.2 (b), (c), (d), (r), 5.1 (e), (f) & (g) 5.7.4, 6.4.13 6.4.7 5.5 5.2 (e), 5.6.2 (b) 5.2 (l)

19 20 21 22 23 24 25 26 27 28 29 30 31

Inter-regional link, Trans-national & Collective Transactions scheduling ISGS Declaration Issuance of directions by RLDC for maintaining Grid Security ISTS Planning Criteria LTOA / MTOA / STOA Metering & SEM data processing Opening / Removal / Tripping of Tr Element / Event or Disturbance Reporting Operating Procedure of National / Regional / State Grid Outage planning Process Overdrawal Limit Periodic Reports Prolonged Outages Protection & Relay Setting co-ordination

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32 33 34 35 36 37 38 39 40 41 42

Ramp up / down Reactive Power Compensation Recording Instruments Restricted Governor Mode Operation (RGMO) Revision of Schedule by RLDC Solar / Wind generation System Protection Scheme (SPS) Tap Changing of ICTs Unfair gaming or collusion Unscheduled Interchange (UI) Wind / Solar Generation scheduling

6.4.16, 6.5.14, 6.5.15 4.6.1 4.6.3 5.2 (f) 6.5.16, 6.5.18, 6.5.19, 6.5.20, 6.5.21 5.2 (u) 3.5 (f), 5.2 (o) 6.6.4, 6.6.5 6.4.25 6.4.6, 6.4.7, 6.4.10, 6.4.11, 6.5.23,

2.0 Background IEGC 2000 The draft of first ever IEGC was prepared by the Central Transmission Utility (CTU), POWERGRID in March 1999 and was approved by CERC after a public hearing in January 2000. The first IEGC came in to force with effect from February 2000. The Chapter 8 of the IEGC 2000 provides for constitution of the Review Panel under the chairmanship of Director (Operation), Power Grid (CTU) to facilitate review of the provisions of IEGC in the light of experience gained on its functioning. IEGC 2002 Based on the recommendation of the Commission, the Review panel reviewed the IEGC 2000 and recommended for revision of clause 1.5 Reporting of Non-compliance, other sections like 1.9, 2.2.2(2), 2.3.2(6), 4.8 (a) to (d), 4.9(c), 6.5(e), 6.7.4(e), 6.8(a), 6.9.1, 6.9.3, 6.9.4(b), replacement of Pool account by UI settlement system, incorporation of VAR charges, format for furnishing planning data by CTU and etc., Accordingly, CERC had approved for the amendment of IEGC with effect from March 2002 vide order dated 22nd February 2002 on review petition 90 / 2001. IEGC 2006 The IEGC 2006 that came in to effect from 01st April 2006 was a maiden IEGC due to the following reasons.

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Some of the provisions in the IEGC dated 14.03.2002 required a revision to get aligned with the provisions in the Electricity Act, 2003, which had come into force from 10.06.2003. An important provision under section 79(1) (h) in the new Act is that CERC has to specify Grid Code having regard to Grid Standards. This implies that the new IEGC has to be a CERC document , rather than a document owned by CTU (and only approved by CERC). As per directive 4 of CERC on 31.03.1999, the CTU had to, in consultation with all utilities, prepare, implement, periodically review and revise and comply with the IEGC. This position was substantially changed. The IEGC 2003 had a chapter titled Management of Indian Electricity Grid Code, which was relevant in the previous scenario. It provided for an IEGC Review Panel, with Director (Operation), POWERGRID as its chairman and convenor. Any change in IEGC, required agreement in the IEGC Review Panel and approval by CERC. Now that the responsibility for specifying the Grid code directly vested to CERC, and the Grid Code and its revisions were to be issued adopting the procedure followed for CERCs regulations, the IEGC Review Panel was no longer necessary. The exercise of preparing the new draft IEGC was also not being routed through the present IEGC Review Panel, for the same reasons. The above chapter had been rewritten, removing all references to the IEGC Review Panel . As per Section 73(d) of the Act, the Grid Standards for operation and maintenance of transmission lines are to be specified by Central Electricity Authority (CEA). As and when Grid Standards are specified by CEA, if required, the IEGC shall be amended. As per section 28 (3) (c), of the Electricity Act, 2003, the Regional Load Despatch Centres (RLDC) shall keep accounts of quantity of electricity transmitted through the regional grid. Accordingly, the responsibility of preparation of Regional Energy Accounts hitherto with the REB Secretariats, transferred to the respective RLDCs with effect from 01.04.2006. The Regional Electricity Boards (REB) was replaced in the new Act by Regional Power Committees (RPC). The Central Government vide its principal resolution dated 25.05.2005 notified establishment of RPCs. Reorganization of the State Electricity Boards (SEBs) envisaged in Part XIII of the Electricity Act, 2003 would lead to formation of a large number of independent entities (generating companies, transmission licensees and distribution licensees) in each State, and consequently a very large number of such intra-State entities in each region. All these entities would come under the regulatory jurisdiction of the concerned State Electricity Regulatory Commission (SERC), and the operational jurisdiction of the concerned State Load Despatch Centre (SLDC). While they would also be connecting into and be synchronized with the same A.C. interconnection, i.e., the regional grid, their operation shall be governed by the State Electricity Grid Code specified by the concerned SERC. Even the directions issued to them by the Regional Load Despatch Centre (the apex body to ensure integrated operation of the regional power system) have to be routed through the concerned SLDC, as per section 29 (3) of the Act. 122

As a logical extension of the above approach and to ensure clear chain of accountability, the following were proposed in IEGC 2006: 1. The RLDC shall interact and coordinate only with the SLDCs (and the STUs if necessary) on all matters concerning a State, and with no other intra-State entity. 2. The SLDCs shall be responsible for all related coordination with the intra-State entities, and interacting on their behalf with the RLDC. 3. Each State as a whole shall be treated as an entity in the regional grid, and as one entity for the purpose of allocations / shares in Inter-State Generating Station (ISGS), for daily scheduling and despatch, for accounting of unscheduled interchange (UI) and reactive energy. 4. The bifurcation of the States total entitlement in ISGS availability for the day, advising the intra-State entities about their respective entitlements, and collecting their requisitions, compiling them into States total requisition from ISGS, etc shall be carried out by the SLDC. 5. The STU / SLDC shall be responsible for installation of special energy meters on the interconnecting points of all intra-State entities who need to have such meters, for organizing the periodic collection of meter readings, preparation of intra-State energy accounts and issuing the UI statements for all concerned entities (once a week). The earlier IEGC was silent regarding the payment for reactive energy exchanges directly between the States on State-owned transmission lines. This aspect was covered in the revised IEGC under a new section (6.6.7). The intra-State scheme for pricing of reactive energy exchanges between the intra-State entities need careful deliberation upon by the concerned SERC / STU, and duly covered in the State Electricity Grid Code. The requirements of local reactive support may differ from State to State and the approach may differ from that in this IEGC. For example, the inter-State generating stations (ISGS) have to generate / absorb reactive power as per instructions of RLDC, without sacrificing on the active generation required at that time, and no payment shall be made to the generating companies for such VAr generation / absorption. This is because (1) the ISGS are mostly located away from load-centres, (2) they generally have a lower variable cost, and (3) they are paid a capacity charge covering the cost of entire installation, including their reactive power capability. The situation of intra-State stations may differ in these respects, and a different approach to their reactive energy output may be necessary. When the first version of IEGC was drafted in 1999, inter-regional exchanges were minimal. Many new inter-regional links have since been commissioned and substantial amounts of energy exchanged between the regional grids. A new chapter was added in the IEGC accordingly, to cover various aspects of scheduling, control and commercial issues of inter-regional exchanges.

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IEGC (Amendment) 2009 Revision in Indian Electricity Grid Code (IEGC) was proposed on account of following reasons and thereby the IEGC (Amendment) Regulation 2009 was issued with effect from 01st April 2009: 1. National Load Despatch Centre (NLDC) has been constituted by Ministry of Power notification dated 14.03.2006, under section 26 of the Electricity Act, 2003. Its role has to be incorporated in IEGC. 2. The existing provisions of scheduling of ISGS in Terms and Conditions of Tariff, 2004-09 have been done away with in new Tariff Regulations for the period 2009-14. These provisions are to be included in IEGC. 3. The power exchanges have been set-up and the scheduling procedures for collective transactions through power exchanges are to be included in IEGC. 4. Central Electricity Authority (Technical Standards for Connectivity to the Grid) Regulations, 2007 and Central Electricity Authority (Installation and Operation of Meters) Regulations, 2006 have been notified. Accordingly Changes are to be made in IEGC. 5. The Regulation on Revised UI mechanism is to be issued by Commission. In accordance with these regulation changes are necessary in IEGC. 6. In the present power sector scenario the role and responsibilities of different agencies have been changed. Accordingly, changes in IEGC are needed. IEGC 2010 The CERC has made a comprehensive review of IEGC provisions in view of various changes and developments in the recent past. The Central Electricity Regulatory Commission (Indian Electricity Grid Code) Regulations, 2010 came in to force with effect from 03rd May 2010. The major changes proposed in the IEGC 2010 were as under: 1. The concept of control area: The concept of control area has been defined in the new version of IEGC. Hitherto, generation was mostly owned by the Central or State governments and there were very few IPPs (Independent Power Producers). In the future there are a lot of upcoming generators belonging to the private sector, having various types of contracts, that is short term, medium term and long term. They could also switch from one type of contract to the other. Some IPPs have a contract for part of the generating capacity with the state in which they are located and contract for a part with states outside the host state. Further, an IPP may tie up contract for different generating units, as they get commissioned in stages, with different purchasers. Therefore, control area jurisdiction is becoming important. The control area jurisdiction has been defined. 2. Integration of Renewable Sources into the Grid: In view of the national policy of encouraging renewable sources of energy, it was felt necessary that provisions regarding this be integrated into the IEGC, 124

taking into account the variable nature of sources such as wind and solar energy. Therefore, an appropriate mechanism for dealing with unscheduled inter-change (UI) due to these sources has been included in the IEGC, keeping in view also other technical requirements related to such integration. The UI impact on renewable is proposed to be dealt with in a manner that solar and wind generators are not financially burdened for the variations in generation, which cannot be reasonably forecast. The Commission is committed to ensure that the renewable energy generators should get the returns as specified in the renewable energy regulations. The proposals in IEGC have been formulated with this spirit, while at the same time addressing the load management needs of the states where large quantities of wind/solar based generation is expected to come up in future. 3. Accountability of the States and distribution utilities: Since the states and their distribution utilities form an integral part of the grid, they have been mandated to become more accountable in carrying out demand management so as to ensure grid security, by mandating automatic demand management schemes. 4. Restricted free governor mode of operation: In view of CERCs order on petitions regarding free governor operation dated 20.8.2009 wherein restricted free governor operation was mandated instead of free governor operation, in view of the shortage condition prevailing in the country, the IEGC has also been modified accordingly. 5. Enabling provision for RLDCs to report violation: RLDCs have been entrusted with higher responsibilities to bring to the notice of the Commission various violations of the IEGC, affecting grid security, through petitions. 6. Tightening of frequency band: In view of the anticipated additional generating capacity coming up in the future and utilization of hourly surplus power through the power exchanges, the shortages are expected to reduce. Hence, the frequency band has been tightened from 49.2-50.3 Hz to 49.5-50.2 Hz. for higher grid security. This should lead to more efficient operation of the power system. 7. Inclusion of medium term transactions in IEGC: CERC had notified the regulations on Grant of Connectivity, Long Term Access and Medium-Term Open Access in Interstate Transmission. In view of the same, changes have been made in the IEGC to also accommodate medium term transactions. 8. Transfer of detailed provisions of UI from IEGC to the CERC (unscheduled Interchange Charges and related matters) Regulations, 2009: Since the detailed Regulations on UI had been notified by the Commission, the detailed clauses from IEGC on UI have been removed. 9. Revision of schedule in case of forced outage: Provision for revision of schedule in case of forced outage for those stations who have a two part tariff based on capacity charge and energy charge for long term contracts, has been incorporated.

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10. Increase in reactive energy charge: The reactive energy charge has been increased from 6 paise per kVArh to 10 paise per kVArh, in order to induce all states to provide capacitors in their system to prevent low voltage profile in certain parts of the grid, which lead to grid security problems. 11. Provisions regarding scheduling and operations: These provisions have been reviewed keeping in view the problem of large overdrawals by many constituents and the present approach of Commission for discouraging use of UI mechanism as trading route. The Commission amended the clause (5) and (7) of the Annexure I of the IEGC 2010 on implementation of scheduling of Wind / Solar energy with effect from 1st January 2011 to 1st January 2012 vide notification dated 14 th January 2011. Through such notifications, the Commission may amend the IEGC time to time in line with the developments in the Indian Power Sector. 3.0 General This chapter explains about the Objective, Scope & Structure of IEGC and the compliance oversight. Objectives (Cl.1.2 of IEGC) The IEGC brings together a single set of technical and commercial rules, encompassing all the Utilities connected to/or using the inter-State transmission system (ISTS) and provides the following: Documentation of principles and procedure that defines relationship of various users Optimal Planning, Operation and Maintenance of National / Regional Grid Facilitation for functioning of Power market and Ancillary services Facilitation of development of renewable energy sources All Users, SLDCs, RLDCs, NLDC, CEA, CTU, STUs, licensees, RPCs and Power Exchanges shall abide the IEGC Damodar Valley Corporation (DVC) will be treated similar to SEB The generating stations of the Bhakra Beas Management Board (BBMB) and Sardar Sarovar Project (SSP) shall be treated as intraState generating stations Any neighbouring country inter-connected with Indian (National) Grid shall be treated as a separate control area.

Scope (Cl.1.3 of IEGC)

Structure of IEGC (Cl.1.4 of IEGC) Part No. 1 Name of the Part General Focus / Coverage Objectives, Scope & Structure of IEGC

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and Non-compliance reporting procedure are briefed. 2 Role of Organisations linkages various Role & functions of NLDC, RLDC, RPC, and their CTU, CEA, SLDC, & STU and their relationship are detailed.

Planning code for Inter- Planning & Co-ordination responsibilities state Transmission (ISTS) for ISTS, intra-state transmission system, Non-discriminatory Open Access by CTU & STU and planning code specifying the philosophy & procedures to be applied in planning of National Grid, Regional Grids and Inter Regional links Connection Code Scope, Procedure for connection, Connection agreement, Important Technical requirements for connectivity like reactive power compensation, data & communication facilities, and system recording instruments, responsibilities for safety, cyber security & International connections to ISTS are briefed. The Connection code applies to CTU,STU and all Users connected to or seeking connection to the ISTS, The Connection code does not apply Operating Philosophy, System Security aspects like Prolonged outages, RGMO, operating range of frequency & voltage, system protection including SPS & communication aspects Demand Estimation & Management for operational purpose including Grouping of loads, Automatic disconnection of loads, etc., Periodic Reports & Operation Liaison Outage planning Recovery Procedure

Operating Code

Scheduling Code

&

Despatch a) Demarcation of responsibilities between various regional entities, SLDC, RLDC and NLDC in scheduling and dispatch as per control area b) the procedure for scheduling and dispatch of LTA / MTOA / STOA & PX transactions and ISGS Hydro generation 127

including revision & curtailment procedure c) the reactive power and voltage control mechanism d) Scheduling of Renewable Energy 7 Miscellaneous Provisions for revision of IEGC and issue any order by CERC as deemed fit including power to relax the provisions of IEGC.

Compliance of oversight (Cl.1.5 of IEGC) RLDC shall report to the Commission on persistent non-compliance of RLDCs directions on secured grid operation. Member Secretary, RPC may also report to Commission any issues that could not be sorted out in RPC forum RPC shall file monthly report on UI payment and installation of capacitors details to Commission Commission may initiate action based on RLDC / RPC report or suomotu Non-compliance of any provisions of IEGC by NLDC, RLDC, SLDC and RPC can be reported to Commission by any other person

4.0 Role of various organizations and their linkages Role of National Load Despatch Centre (NLDC) (Cl.2.2 of IEGC) Monitoring & operation of National Grid Co-ordination for restoration of synchronous National grid Co-ordination for trans-national exchange of power Supervision over RLDCs Supervision & control over inter-regional links Scheduling & Despatch of electricity over inter-regional links Co-ordination with RLDCs for inter-regional energy accounting and exchange of power NLDC shall be the nodal agency for collective transactions NLDC shall be the National level disaster management co-ordinator in power system. Maintaining PDC fund and any other things as directed by CERC

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Role of Regional Load Despatch Centre (RLDC) (Cl.2.3 of IEGC) Apex body of the respective region Optimum scheduling & dispatch within the region in accordance with the contracts entered by the licensee or the generating companies operating in the region Keeps account of energy transmitted through regional grid Supervision & control over Inter-state Transmission System (ISTS) Monitoring Grid operation and issue such direction for stable grid operation enduring economic & efficient grid operation. All the Regional Entities shall comply with such directions of RLDC. RLDC shall issue Directions to STU, any licensee of the state & the generating companies that are not connected to ISTS shall be issued through SLDC and SLDC shall ensure that such directions are duly complied with by the respective agency. Any dispute on the directions of RLDC, the matter shall be referred to CERC. Pending decision of CERC, the directions of RLDC shall be complied with. RLDC of the region where point of drawal of electricity is situated shall be the nodal agency for the STOA transactions. RLDC shall be the nodal agency for restoration following a system disturbance. Operation of regional UI pool account, regional reactive energy account and Congestion Charge Account, provided that such functions will be undertaken by any entity(ies) other than RLDCs if the Commission so directs. Operation of ancillary services Undertake Operational Analysis in the region Co-ordinate with STU & CTU to facilitate planning of Intra & Inter-state transmission system Outage planning & co-ordination in the region System Protection studies for the region Certification of system availability factor for the purpose of payment of transmission charges

Role of Regional Power Committee (RPC) (Cl.2.4 of IEGC)

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Preparation of Regional Energy Account, UI account, Reactive energy account and congestion charge account based on the data given by RLDC. Transmission of electricity through ISTS network Planning & co-ordination related to ISTS with all the agencies Provide non-discriminatory open access of ISTS to any licensee or generating company or bulk customer as per the provisions of Electricity Act 2003. CTU shall be the nodal agency for ISTS connectivity of LTA & MTOA CTU shall not engage in the business of trading / generating electricity To specify grid standards for O&M of transmission lines To specify conditions for installation of meters for supply & transmission of electricity To specify the technical standards for construction of electrical plants, electric lines and connectivity to the grid To specify the safety requirements for construction, operation and maintenance of electrical plants and electric lines Notify National Electricity plan once in five years Prepare & publish National Electricity policy Apex body for grid operation in the state Optimum scheduling & dispatch within the region in accordance with the contracts entered by the licensee or the generating companies operating in the state Keeps account of energy transmitted through state grid Supervision & control over Intra-state Transmission System Responsible for real time grid operation in the state Complying the directions of RLDC and get execute such directions through STU, licensees, generating companies of the state Issue concurrence or no-objection for STOA & collective transactions of state utility or intra-state entity Undertake transmission of electricity through intra-State transmission system;

Role of Central Transmission Utility (CTU) (Cl.2.5 of IEGC)

Role of Central Electricity Authority (CEA) (Cl.2.6 of IEGC)

Role of State Load Despatch Centre (SLDC) (Cl.2.7 of IEGC)

Role of State Transmission Utility (STU) (Cl.2.8 of IEGC)

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Co-ordination for planning & development of intra-state transmission network. To provide non-discriminatory Open Access to its transmission network by licensees, generating companies and bulk customers of the state on payment of transmission charges Operate the SLDC till the State Government notify any company or authority or corporation for this purpose

5.0 Planning Code for Inter-state Transmission The Central Transmission Utility (CTU) shall discharge all functions of planning and co-ordination relating to inter-State transmission system in coordination with State Transmission Utility, Central Government, State Governments, Generating Companies, Regional Power Committees, Central Electricity Authority (CEA), licensees and any other person notified by the Central Government in this behalf. CTU shall also provide non-discriminatory open access of Inter-state transmission system as per open access regulation. The above functions for the intra-state transmission system requirements shall be discharged by the respective State Transmission Utility (STU). CEA is responsible for preparation of National Electricity plan and National Electricity policy and also advice central government regarding formulation of short term and prospective plans for the development of electricity system facilitating reliable and affordable electricity for all consumers. The Planning Code specifies the philosophy and procedures to be applied in planning of National Grid, Regional Grids and Inter Regional links. Input considered for power system planning by CTU While planning schemes, the following shall be considered in addition to the data of authenticated nature collected from and in consultation with users by CTU: (i) Perspective plan formulated by CEA. (ii) Electric Power Survey of India published by the CEA (iii) Transmission Planning Criteria and guidelines issued by the CEA (iv) Operational feedback from RPCs (v) Operational feedback from NLDC/RLDC/SLDC (vi) Central Electricity Regulatory Commission ( Grant of Connectivity, Longterm Access and Medium-term Open Access in inter-state Transmission and related matters) Regulations ,2009 (vii) Renewable capacity addition plan issued by Ministry of New and Renewable Energy Sources ( MNRES), Govt of India 131

Finalisation Procedure The interstate transmission proposals including system strengthening scheme and planning of capacitors, SVC & Flexible Alternating Current Transmission System (FACTS) etc., identified on the basis of the planning studies would be discussed, reviewed and finalized in the meetings of Regional Standing Committees for Transmission Planning constituted by CEA, in consultation with the Regional Entities, RPC, CEA, NLDC and the RLDC and action may be taken by CTU on the basis of Power Purchase Agreements (PPAs) signed with the beneficiaries. Where all PPAs are not signed, CTU will approach CERC for necessary approval. Based on Plans prepared by the CTU, State Transmission Utilities (STU) shall have to plan their systems (intra-state) to further evacuate power from the ISTS, system strengthening of state network and etc., to optimize the use of integrated transmission network. Planning Criteria 1. As a general rule, the ISTS shall be capable of withstanding and be secured against the following contingency outages. The below contingencies shall be considered assuming a pre-contingency system depletion (Planned outage) of another 220 kV D/C line or 400 kV S/C line in another corridor and not emanating from the same substation. Without necessitating load shedding or rescheduling of generation during Steady State Operation - Outage of a 132 kV D/C line or, - Outage of a 220 kV D/C line or, - Outage of a 400 kV S/C line or, Without necessitating load shedding but could be with rescheduling of generation during steady state operation - Outage of a 400 kV S/C line with TCSC, or - Outage of a 400kV D/C line, or

- Outage of single Interconnecting - Outage of both pole of HVDC Bipole line or Transformer, or - Outage of one pole of HVDC Bipole - Outage of both poles of HVDC back to back Station or line, or - Outrage of one pole of HVDC back - Outage of a 765kV S/C line with series compensation. to back Station or - Outage of 765 kV S/C line 2. The ISTS shall be capable of withstanding the loss of most severe single system infeed without loss of stability. 3. Any one of these events defined above shall not cause: a. Loss of supply b. Prolonged operation of the system frequency below and above specified limits. c. Unacceptable high or low voltage 132

d. System instability e. Unacceptable overloading of ISTS elements. 4. In all substations (132 kV and above), at least two transformers shall be provided. 5. CTU shall carry out planning studies for Reactive Power compensation of ISTS including reactive power compensation requirement at the generators / bulk consumers switchyard and for connectivity of new generator / bulk consumer to the ISTS 6. Suitable System Protection Schemes ( SPS) may be planned by NLDC / RLDC in consultation with CEA, CTU, RPC and the Regional Entities, either for enhancing transfer capability or to take care of contingencies beyond that indicated above

6.0 Connection Code CTU, STU and Users connected to, or seeking connection to ISTS shall comply with Central Electricity Authority ( Technical Standards for connectivity to the Grid ) Regulations, 2007 which specifies the minimum technical and design criteria and Central Electricity Regulatory Commission (Grant of Connectivity, Long-term Access and Medium term Open Access in inter-state Transmission and related matters) Regulations,2009. Scope & Nodal Agency for Grant of Connectivity The Connection code applies to CTU,STU and all Users connected to or seeking connection to the ISTS, The Connection code does not apply to Generating Units, transmission / distribution systems embedded in the intra-State systems, and not connected to the ISTS. All entities shall abide by the CEA (Technical Standards for connectivity to the Grid) Regulations,2007 CTU is the nodal agency for grant of connectivity The User / STU shall provide adequate reactive compensation in the LV system close to the load points power

Reactive Power Compensation

The person already connected to the grid shall also provide additional reactive compensation as per the quantum and time frame decided by respective RPC in consultation with RLDC. The Users and STUs shall provide information to RPC and RLDC regarding the installation and healthiness of the reactive compensation equipment on regular basis. RPC shall regularly monitor the status in this regard.

Data & Communication and System Recording Instruments, Cyber Security etc.,

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All Users, STU and CTU shall be responsible to provide reliable and efficient speech and data communication system made available to RLDC. Both analog data like flow, voltage, etc., and status data like transformer tap position, status of switches etc., as required by the RLDC shall be made available All Users, STUs and CTU shall provide all the requisite recording instruments and shall always keep them in working condition All utilities shall have in place, a cyber security framework to identify the critical cyber assets and protect them so as to support reliable operation of the grid.

7.0 Operating Code Operating Philosophy (IEGC Cl.5.1) The primary objective of integrated operation of the National / Regional grids is to enhance the overall operational reliability and economy of the entire electric power network spread over the geographical area of the interconnected system. Participant utilities shall cooperate with each other and adopt Good Utility Practice at all times for satisfactory and beneficial operation of the National/Regional grid. NLDC shall o Supervise National / inter-regional grid. o Develop & maintain detailed operating procedure for National Grid in consultation with RLDCs. RLDC shall o Supervise Regional / inter-state grid. o Develop & maintain detailed operating procedure for the Regional grid in consultation with the regional entities. SLDC shall o Supervise State / intra-state grid o Develop & maintain detailed operating procedure for the State grid in consultation with the concerned persons. All persons shall comply with the operating code of IEGC All licensees, generating company, generating station and any other person connected with the operation power system shall comply with the directions issued by the respective RLDC / SLDC The control rooms of the NLDC, RLDC, all SLDCs, power plants, substation of 132 kV and above, and any other control centers of all regional entities shall be manned round the clock by qualified and adequately trained personnel

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System Security Aspects (IEGC Cl.5.2) No part of the grid shall be deliberately isolated from the rest of the National/Regional grid, except o Under an emergency, and conditions in which such isolation would prevent a total grid collapse and/or would enable early restoration of power supply, o For safety of human life o When serious damage to a costly equipment is imminent and such isolation would prevent it, o When such isolation is specifically instructed by RLDC. No important element of the National / Regional grid shall be deliberately opened or removed from service at any time, except when specifically instructed by RLDC or with specific and prior clearance of RLDC. In case of opening/removal of any important element of the grid under an emergency situation, the same shall be communicated to RLDC at the earliest possible time after the event. Any tripping, whether manual or automatic, of any of the important elements of Regional grid shall be precisely intimated by the concerned SLDC/CTU/User to RLDC along with the reason to the extent determined, within ten minutes of the event. RLDC shall monitor and report to RPC the details of prolonged outage of elements that may likely to cause danger / sub-optimal operation of regional grid. RPC shall give instructions to restore as per finalized action plan. All thermal generating units of 200 MW and above and all hydro units of 10 MW and above (except those with up to three hours pondage) shall have their governors in operation at all times in accordance with the RGMO provisions w.e.f.01.08.2010 Features of RGMO o While grid frequency below 50.2Hz, for rise in frequency, there shall No reduction in generation by the units. o While grid frequency below 50.2Hz, for fall in frequency, the units should increase its generation by 5% limited to 105% of MCR o Ripple filter of + / - 0.03Hz shall be provided to prevent Governor hunting during load correction o Governor droop setting shall be between 3% - 6% Gas, Wind, Solar & Hydro units up to 3hour pondage are exempted from RGMO provision Any unit required to be operated without its Governor in operation shall immediately communicate the reason for the same to RLDC

Restricted Governor Mode Operation (RGMO)

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No dead bands and / or time delays shall be deliberately introduced except as specified in para 5.2(f) of IEGC. The recommended rate for changing the governor setting, i.e., supplementary control for increasing or decreasing the output (generation level) for all generating units, irrespective of their type and size, would be one (1.0) per cent per minute or as per manufacturers limits. However, if frequency falls below 49.7Hz, all partly loaded generating units shall pick up additional load at a faster rate, according to their capability.

Variation limit Generation / Load No User shall suddenly reduce his generating unit output by more than one hundred (100) MW (20MW in case of NER) without prior intimation to and consent of the RLDC, particularly when frequency is falling or is below 49.5 Hz. No User / SEB shall cause a sudden variation in its load by more than one hundred (100 MW) without prior intimation to and consent of the RLDC. The Automatic Voltage Regulator (AVR) of the generator shall be in service. The Power System Stabilizers (PSS) shall be tuned by the respective generating owner as per the plan proposed by CTU / RPC. The CTU / RPC shall be allowed to carry out checking where ever it considered. The grid frequency always remains within the 49.5 50.2 Hz band. All SEBs, distribution licensees, CTU STUs and SLDCs shall ensure that the above under-frequency and df/dt load shedding / islanding schemes are always functional.. SLDC shall furnish monthly report of UFR and df/dt relay operation in their respective system to the respective RPC. RLDC shall inform RPC Secretariat about instances when the desired load relief is not obtained through these relays in real time operation. A monthly report on expected load relief vis-a-vis actual load relief shall be sent to the RPC and the CERC. System Protection Schemes (SPS) to operate the transmission system closer to its limit and protect against voltage collapse, cascade tripping etc., shall be finalized in the RPC forum and shall be kept in service always. If any SPS is to be taken out of service, 136

AVR / PSS

Operating Frequency Range AUFR & df / dt and System Protection Schemes

permission of RLDC shall be obtained indicating reason and duration of anticipated outage from service All the Users, STU/SLDC and CTU shall send information / data including disturbance recorder / sequential event recorder output to RLDC within one week for purpose of analysis of any grid disturbance/event.

Permissible Voltage Range (kV rms) Nominal 765 400 220 132 110 66 33 Maximum 800 420 245 145 121 72 36 Minimum 728 380 198 122 99 60 30

Special requirements for Solar / Wind generation Generally Solar / Wind power will be treated as must-run station and SLDC / RLDC can instruct to back down MW or curtail VAR drawl / injection in case of grid security / endanger to personal / costly equipments During the wind generator start-up, the wind generator shall ensure that the reactive power drawl (inrush currents incase of induction generators) shall not affect the grid performance. SLDC is responsible for Demand estimation using historical data & weather / wind energy forecast data w.e.f 01 st January 2011 using appropriate mechanism / facility. Both Active & Reactive Power demand needs to be estimated It shall be done on daily / weekly / monthly / yearly basis SLDC shall carryout Operational planning studies based on their Demand estimation Demand management measures like power cut, load shedding etc., shall be based on SLDC demand estimation Distribution licensees shall abide & execute demand management measures as per SLDCs direction 137

Demand Estimation (Cl.5.3 of IEGC)

Distribution licensees shall provide necessary data to SLDC SLDC shall furnish month wise demand estimation details to RLDC & RPC for better operation planning and estimation of ATC / TTC on three month ahead basis. SLDC shall maintain Historical data base on demand estimation SLDC / SEB / Distribution Licensee / Bulk Consumer shall o Initiate action to restrict drawal within its schedule when system frequency falls below 49.7Hz o Ensure NO overdrawal when system frequency is 49.5Hz or below

Demand Management (cl.5.4 of IEGC)

Each User / STU / SLDC shall develop and implement a contingency procedure for demand disconnection and update / review the same regularly. RLDC / SLDC shall monitor the same. The SLDC through respective State Electricity Boards / Distribution Licensees shall also formulate and implement state-of-the-art demand management schemes for automatic demand management like rotational load shedding, demand response (which may include lower tariff for interruptible loads) etc. before 01.01.2011 In order to maintain the frequency within the stipulated band and maintaining the network security, the interruptible loads shall be arranged in four groups of loads as given below without overlapping. o For scheduled power cuts/load shedding, o Loads for unscheduled load shedding, o Loads to be shed through under frequency relays / df/dt relays and o Loads to be shed under any System Protection Scheme identified at the RPC level.

RLDC shall issue directions to reduce overdrawal in standard message formats developed by the RLDC for this purpose. SLDCs shall comply with the directions and also reply immediately through compliance report. The measures taken by the Users, SLDC SEB/distribution licensee or bulk consumer shall not be withdrawn as long as the frequency remains at a level lower than the limits specified in para 5.2 of IEGC or congestion continues, unless specifically permitted by the RLDC/SLDC Weekly Report on performance of National Grid / Regional Grid prepared by NLDC / RLDC respectively shall be available in its website for 12 weeks 138

Periodic Reports

The weekly reports shall contain the following:o Frequency profile o Voltage profile of important substations and sub-stations o Major Generation and Transmission Outages o Transmission Constraints o Instances of persistent / significant non-compliance of IEGC. o Instances of congestion in transmission system o Instances of inordinate delays in restoration of transmission elements and generating units o Non-compliance of instructions of SLDC by SEB/distribution licenses / bulk consumers, to curtail drawal resulting in noncompliance of IEGC.

NLDC shall send the monthly report to CERC, CEA, RPCs & RLDCs Daily power system report / Quarterly report prepared by the RLDC shall also be available in its website The Operational liaison function is a mandatory built-in hierarchical function of the NLDC, RLDC, SLDC and Users, to facilitate quick transfer of information to operational staff. It will correlate the required inputs for optimization of decision making and actions. Any operation carried / executed by NLDC / RLDC / SLDC / Users / CTU / STU that may have impact on other control area shall be communicated to the respective agency, prior & after execution. Annual outage plan for the financial year prepared by RPC in consultation with RLDC & NLDC by 31st January of each year. It is reviewed quarterly & monthly. If any deviation required by CTU / STU / Users, the same shall be with the prior permission of RPC & RLDC All SEBs / STUs, transmission licensees, CTU, ISGS, IPPs, MPPs and other generating stations shall provide RPC Secretariat their proposed outage programmes in writing for the next financial year by 30th November of each year. RPC shall issue the draft outage plan by 31st December of each year. The outage plan shall be finalized by 31st January of each year RLDC may conduct studies before clearance of the planned outage. NLDC/RLDC are authorized to defer the planned outage in case of o Grid disturbances o System isolation o Partial Black out in a state

Operational Liaison

Outage Planning (Cl.5.7 of IEGC)

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o Any other event in the system that may have an adverse impact on the system security by the proposed outage Each User, CTU and STU shall obtain the final approval from RLDC prior to availing an outage. Detailed plans and procedures for restoration of the regional grid under partial/total blackout shall be developed by RLDC in consultation with NLDC, all Users, STU, SLDC, CTU and RPC Secretariat Black Start Restoration Procedure developed by RLDC shall be reviewed / updated annually. User / STU / CTU in consultation with RLDC shall develop the Black Start Restoration Procedure for the respective system within the region Black Start Restoration Procedure developed by the User / STU / CTU shall be reviewed / updated once in every subsequent year. Mock trail for different sub-systems shall be carried out at least once in six months Black start DG set shall be tested on every week and report shall be sent on quarterly basis to RLDC List of generating stations with black start facility, interState/interregional ties, synchronizing points and essential loads to be restored on priority, shall be prepared and be available with NLDC, RLDC and SLDC. RLDC / SLDC shall be responsible for reporting events to all Users / SLDC / STU / CTU / NLDC / RLDC / RPC secretariat All Users / SLDC / STU / CTU shall be responsible for collection & reporting of necessary data to RLDC / NLDC / RPC Reportable events are o Violation of security standards. o Grid indiscipline. o Non-compliance of RLDCs instructions. o System islanding/system split o Regional black out/partial system black out o Protection failure on any element of ISTS, and on any item on the agreed list of the intra-State systems. o Power system instability o Tripping of any element of the Regional grid. 140

Recovery Procedure (Cl.5.8 of IEGC)

Event Information (Cl.5.9 of IEGC)

o Sudden load rejection by any User The report shall be in the format devised by LDC containing o Time and date of event o Location o Plant and/or Equipment directly involved o Description and cause of event o Antecedent conditions of load and generation, including frequency, voltage and the flows in the affected area at the time of tripping including Weather Condition prior to the event o Duration of interruption and Demand and/or Generation (in MW and MWh) interrupted o All Relevant system data including copies of records of all recording instruments including Disturbance Recorder, Event Logger, DAS etc o Sequence of trippings with time. o Details of Relay Flags. o Remedial measures. 8.0 Scheduling and Despatch Code Demarcation of responsibilities (cl.6.4 of IEGC) The national interconnected grid is divided into control areas The Load Despatch Centre of a control area is responsible for coordinating the scheduling of a generating station, within the control area, real-time monitoring of the stations operation, checking that there is no gaming (gaming is an intentional misdeclaration of a parameter related to commercial mechanism in vogue, in order to make an undue commercial gain) in its availability declaration, or in any other way revision of availability declaration and injection schedule, switching instructions, metering and energy accounting, issuance of UI accounts within the control area, collections/disbursement of UI payments, outage planning, etc. RLDC shall coordinate the scheduling of the following generating stations: o Central Generating Stations or generating stations connected to ISTS only (excluding stations where full Share is allocated to host state), o Ultra-Mega power projects o Generating station which is connected both to ISTS and the State network and the State has a Share of 50% or less 141

Control Area

SLDC shall coordinate the scheduling of the following generating stations: o Generating station which is connected only to the State transmission network (excluding Central Generating stations where more than one state have allocation) o Generating station which is connected both to ISTS and the State network and the State has a Share of more than 50%.

In case commissioning of a plant is done in stages the decision regarding scheduling and other functions performed by the system operator of a control area would be taken on the basis of above criteria depending on generating capacity put into commercial operation at that point of time. Therefore it could happen that the plant may be in one control area (i.e. SLDC) at one point of time and another control area (i.e. RLDC) at another point of time. The switch over of control area would be done expeditiously after the change, w.e.f. the next billing period. NLDC shall be responsible for scheduling and despatch of electricity over inter-regional links in accordance with the grid code specified by Central Commission in coordination with Regional Load Despatch Centers. SLDCs shall have the total responsibility for o Scheduling / despatching their own generation (including generation of their embedded licensees), o Regulating the demand of its control area, o Scheduling their drawal from the ISGS (within their share in the respective plants expected capability), o Permitting long term access, medium term and short term open access transactions for embedded generators/consumers, in accordance with the contracts o Regulating the net drawal of their control area from the regional grid in accordance with the respective regulations of the CERC. o The drawal schedule of each regional entity will be the algebraic summation of scheduled drawal from ISGS and from contracts through a longterm access, mediumterm and shortterm open access arrangements and Collective transactions.

Permissible Drawal / Injection deviation The regional entities shall regulate their generation and / or consumers load so as to maintain their actual drawal from the regional grid close to the above schedule. Deviation from the drawal schedule, within the limit specified by the CERC in UI Regulations as long as such deviations do not cause system parameters to deteriorate beyond permissible limits and / or do not lead to unacceptable line loading, However,such deviations from net drawal

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schedule shall be priced through the Unscheduled Interchange (UI) mechanism. No limit for overdrawal subject to network condition when system frequency is above 49.7Hz Overdrawal permitted subject to network condition and as per UI regulations when the system frequency is above 49.5Hz but below 49.7Hz No overdrawal permitted when system frequency is 49.5Hz or below and is to be ensured through automatic demand management. The ISGS would normally generate power according to the daily schedules advised to them. The ISGS may also deviate from the given schedules within the limits specified in the CERC UI Regulations of CERC, depending on the plant and system conditions. No over injection of ISGS permitted When system frequency 50.2Hz. ISGS may back down when system frequency 50.2Hz and maximize the generation when frequency falls 49.7Hz without waiting for the instruction of RLDC subject network / plant condition. above above below to the

In addition, deviations, from schedules causing congestion, shall also be priced in accordance with the Congestion Charge Regulations of CERC RLDC may direct the SLDCs / ISGS / increase / decrease their drawal / contingencies e.g. overloading of lines voltages, threat to system security. immediately be acted upon. other regional entities to generation in case of / transformers, abnormal Such directions shall

Real-time System Security Measures

In case of any contingencies or threat to system security, curtailment / termination of STOA shall be done prior to LTOA / MTOA During fuel shortage condition , in case of thermal ISGS stations, they may specify minimum MW, maximum MW, MWh capability and declaration of fuel shortage. The generating stations shall also declare the possible ramping up / ramping down in a block. In case of a gas turbine generating station or a combined cycle generating station, the generating station shall declare the capacity for units and modules on APM gas, RLNG and liquid fuel separately, and these shall be scheduled separately. The ISGS shall ensure that the declared capability during peak hours is not less than that during other hours. However, exception to this rule shall be allowed in case of tripping / re-synchronisation of units as a result of forced outage of units. 143

Declaration of Capacity

RLDC may ask the ISGS to explain the situation with necessary backup data in case the capacity declaration was felt as deliberately over / under declaration. The ISGS shall be required to demonstrate the declared capability of its generating station as and when asked by the Regional Load Despatch Centre of the region in which the ISGS is situated. In the event of the ISGS failing to demonstrate the declared capability, the capacity charges due to the generator shall be reduced in geometric progressively as a measure of penalty. Ie. 2 days capacity charges for the first instance, 4 days capacity charges for the second instance and so on. The CTU shall install special energy meters on all inter connections between the regional entities and other identified points for recording of actual net MWh interchanges and MVArh drawals. All concerned entities (in whose premises the special energy meters are installed) shall take weekly meter readings and transmit them to the RLDC by Tuesday noon. The SLDC must ensure that the meter data from all installations within their control area are transmitted to the RLDC within the above schedule. RLDC shall compute 15 minute-wise UI of all the regional entities and send to RPC by Thursday noon. RPC shall prepare UI account and issue. UI computation shall be available for 15days in RLDC website for verification by all. NLDC shall be responsible for coordination with Regional Load Despatch Centers for the energy accounting of inter-regional exchange of power. NLDC shall also be responsible for coordination for trans-national exchange of power. Hydro generating stations are expected to respond to grid frequency changes and inflow fluctuations. The hydro generating stations shall be free to deviate from the given schedule without causing grid constraint and a compensation for difference between the actual net energy supply by the hydro generating station and the scheduled energy (ex-bus) over day shall be made by the concerned Regional Load Despatch Centre in the day ahead schedule for the 4th day (day plus 3). Maximum Ramp up / down for an ISGS / regional entity is 200MW per hour. (50MW for NER) except Hydro that may ramp up / down faster. While doing schedule, RLDC may consider ramping as per system condition / machine permissibility

Unscheduled Inter-change Accounting

Hydro (ISGS) scheduling

Scheduling Process

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Entitlement of each beneficiary regional entity = sum of (Block wise declared capacity of ISGS X Share allocation of respective Regional Entity) ISGS shall advise day ahead block wise declaration by 08:00hrs RLDC shall compute and communicate the total ISGS entitlement of each Regional Entity by 10:00hrs SLDC shall communicate the total requirement from ISGS, LTOA / MTOA / STOA by 15:00hrs based on daily forecast Scheduling of collective transactions co-ordinated by NLDC as per the following sequence o NLDC advise PX the details of ATC for PX the list of Interfaces / control areas / regional transmission systems o Power Exchange(s) shall furnish the information of total drawal and injection in each of the regions. o NLDC shall check for congestion and revert back the details if any to PX. o PX shall communicate the tentative schedule of Collective transactions to NLDC o NLDC verify with the RLDC the ATC in line with PX schedule and then confirms to PX & RLDCs for scheduling.

The individual transactions for State Utilities/intra-State Entities shall be scheduled by the respective SLDCs. Power Exchange(s) shall send the detailed break up of each point of injection and each point of drawal within the State to respective SLDCs after receipt of acceptance from NLDC. Power Exchange(s) shall ensure necessary coordination with SLDCs for scheduling of the transactions. Including collective transactions, RLDC shall release the first day ahead drawl / injection schedule by 18:00hrs SLDC / ISGS communicate the changes if any in their requirements / capacity declaration by 22:00hrs. Incorporating all such changes, RLDC prepares the final day ahead injection / drawal schedule and release for implementation. The hydro electric generation stations are expected to respond to grid frequency changes and inflow fluctuations. They would, therefore, be free to deviate from the given schedule as long as they do not cause a grid constraint. As a result, the actual net energy supply by a hydro generating station over a day may differ from schedule energy (ex-bus) for that day. While the 15- minute wise, deviations from schedule would be accounted for as Unscheduled Interchange (UI), the net energy deviation for the whole day, if any, shall be additionally accounted in the day ahead schedule for the 4 th day (day plus 3)

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Run-of-river power stations, renewable energy power plants (except for biomass power plants and non-fossil fuel based cogeneration plants whose tariff is determined by the CERC) shall treated as must run stations. All shall be treated as MUST RUN power plants and shall not be subjected to merit order despatch principles. RLDC shall suo-motu revise the injection / drawal schedule of ISGS / regional entities in case of system constraint or for ensuring better operation, which shall be effective from 4 th time block counting the block in which bottleneck of evacuation of power has taken place. During the first three blocks, actual injection / drawal is deemed as schedule. Based on request from ISGS / beneficiary regional entity RLDC shall revise the injection / drawal schedule of ISGS / beneficiary regional entity, which shall be effective from 6th time block. In case of forced outage of a unit for a Short Term bilateral transaction, where a generator of capacity of 100 MW and above is seller, the generator shall immediately intimate the same along with the requisition for revision of schedule and estimated time of restoration of the unit, to SLDC/RLDC as the case may be. RLDC shall revise the schedules and shall become effective from the 4th time block, counting the time block in which the forced outage is declared to be the first one. The original schedule shall become effective from the estimated time of restoration of the unit. However the transmission charges as per original schedule shall continue to be paid for two days. The schedule of thermal generating stations indicating fuel shortage while intimating the Declared Capacity to the RLDC shall be revised only in case of forced outage of generating unit. In case of grid disturbance, actual injection / drawal shall be deemed as schedule of ISGS / regional entities. Certification of grid disturbance and its duration shall be done by the RLDC. To discourage frivolous revisions, an RLDC may, at its sole discretion, refuse to accept schedule/capability changes of less than two (2) percent of previous schedule/capability. With effect from 1.1.2012 Scheduling of wind power generation plants would have to be done for the purpose of UI where the sum of generation capacity of such plants connected at the connection point to the transmission or distribution system is 10 MW and above and connection point is 33 KV and above, and where PPA was not yet been signed as on 03.05.2011 Maximum of 8 revisions per day for each 3hour time slot starting from 00:00 hours during the day, which shall become effect from 6 th time block, the first being the time block in which notice was given. 146

Revision of Schedule

Scheduling of Wind / Solar Generation

The schedule of solar generation shall be given by the generator based on availability of the generator, weather forecasting, solar insolation, season and normal solar generation curve and shall be vetted by the RLDC in which the generator is located and incorporated in the inter-state schedule. Whenever there is a system requirement for curtailment of power flow in a corridor, RLDC may do so including for the transactions that were already scheduled. While doing so, in the priority order of STOA, Collective Transactions, MTOA, LTOA will be followed on prorate basis. RLDCs would curtail a Transaction at the periphery of the Regional Entities. SLDC(s) shall further incorporate the inter-se curtailment of intra-State Entities to implement the curtailment The final implemented schedule prepared by RLDC is made available open for 5 days for rectification of error if any, detected. The schedules shall have a resolution of 1MW for declared capacity of ISGS and 0.01MW & 0.01MWh for other. Regional entities (except generating stations) pays for VAr drawal at voltage below 97% and for VAr injection at voltage above 103% Regional entities (except generating stations) get paid for VAr injection at voltage below 97% and for VAr drawal at voltage above 103% The charge for VArh shall be at the rate of 10 paise / kVArh w.e.f. 1.4.2010, with annual escalation of 0.5paise / kVArh thereafter. RLDC may direct beneficiary regional entity to curtail VAr drawal / injection RLDC may direct changing of ICT tap position at a reasonable intervals ISGS shall inject / absorb Var within machine capability without compromising MW generation. NO charges payable / receivable on this account. The charge for VAr exchange through an interconnected line between two regional entities may be mutually fixed between them, if they feel so.

Curtailment of schedule

Correctness & resolution of Schedule

Reactive Power & Voltage Control

9.0 Commissions power to overrule

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Commission has the powers to review / relax / modify / over rule / amend any provisions of IEGC and give such directions as deemed fit beyond the provisions of IEGC

TABLE OF CONTENTS Topic Introduction Steps in Tariff & Billing Process Procedure for tariff determination Availability factor computation for various systems Energy charges rate Operational norms Example for tariff calculation for a substation Sharing of transmission charges Benchmarking for prudence check by CERC Amendments

No. 1 2 3 4 5 6 7 8 9 10

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CENTRAL ELECTRICITY REGULATORY COMMISSION (TERMS AND CONDITIONS OF TARIFF) REGULATIONS, 2009 1.0 Introduction These regulations are passes as per Sec 62 and 79 to determine tariff of Generating Stations supplying to more than one beneficiary and Inter State Transmission System Period of applicability (Control Period): 5 years (2009-14) 1.1 Background Till March 2001, Tariff of ISGS was fixed by GoI through a notification. Consequent to formation of CERC through ERC act 1998, first regulations on tariff of ISGS were issued for the control period April2001-March2004. Subsequently tariff regulations for the next control period April2004-March 2009 were issued. In 2009 CERC notified tariff for Renewable Energy through CERC (Terms and Conditions of Tariff for Renewable Energy) Regulations, 2009 1.2 Approach in tariff determination and Scope The Philosophy of tariff determination by CERC is based on Cost Plus approach. The regulations are applicable to tariff determination of a) Generating Stations supplying to more than one beneficiary, (Thermal, Hydro, CCGT) b) Inter State Transmission System Tariff of Nuclear power stations is fixed by DAE. 1.3 Terms and Conditions of Tariff Rules for determining the Tariff of ISGS and Transmission licensees. These Regulations outline the procedures for Computation of Capital Cost, Tariff determination, Operational norms for computation of Availability, in respect of ISGS and ISTS. 1.4 Explanation of some Important Definitions and Important terminology: Control Period: Period for which tariff is specified (April 2009-March 2014) MYT: Multi Year Tariff: The tariff spread over useful life of the equipment Beneficiary: Person purchasing power from the ISGS Capital Cost: Total cost of investment comprising of Debt borrowed through loans and Equity from own investment. Cut off date: Last day of FY after 2 years from the CoD. If CoD falls in Q4 then it is last day of FY after 3 years from CoD. After the cut-off date, no additional capitalisation will be allowed. Date of Commercial Operation: date from which Tariff recovery starts. Declared Capacity or DC' Infirm power: Power injected before CoD. It is paid @ UI rate. Profits earned will offset Inter-State generating station or ISGS: Gen Stns supplying power to more than one state.

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Useful life: Life of the system from CoD used for computing Depreciation and determination of Tariff norms. ( Coal/Gas based/ Substation=25 yrs, Hydro/Line 35 yrs) 2.0 Steps in Tariff and Billing Process: 1) Apply for Tariff fixation by CERC Generating Station or Transmission Licensee has to apply to CERC for tariff determination in respect of a. existing units, b. Tr. Lines and Substations c. new projects to be completed within 6 months. d. additional capital expenditure already admitted or for future period 2) 3) 4) 5) 6) 7) 8) Tariff fixation as per prudence checks Fixation of Operational norms for AFC and Energy Charge recovery Determination of Actual vis-s-vis Normative by RPC in REA Billing by Gen Company or Tr. Company Filing of actual Expenditure by the Company Truing up by CERC Adjustment of Excess or Deficit collection as per Trued-up cost.

3.0 Procedure for Tariff determination 1) Specify Debt: Equity Ratio 2) Determine Capital Cost a. Determine the Equity (Restrict as per D:E ratio) b. Determine the Loan (Restrict as per D:E ratio) c. Determine Interest During Construction (IDC) d. Determine loss or gain due to FERV (Foreign Exchange Risk Variation) e. Determine Capitalised initial spares f. (Coal based-2.5%, Gas based-4%, Hydro-1.5%, Tr. Line-0.75%, g. S/S-2.5%, HVDC/ FSC/TCSC-3.5%) h. Determine Additional capital expenditure (up to cut-off date) i. cost of approved rehabilitation and resettlement (R&R) plan (for Hydro projects) j. cost of the developers 10% contribution towards RGGYY (for Hydro projects) k. Determine assets not in use l. Profits from Sale of Infirm Power * Capital Cost = (a+b+c+d+e+f+g+h-i-j) *Sale of Infirm Power: Before CoD, the power injected during testing is to be treated as infirm power at UI rates. Any profits earned would be offset against capital cost

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3) Compute Components of Tariff: a. Capacity Charge (Annual Fixed Charges) b. Energy Charge (Variable Charges) 3.1 Sub Components of Tariff 1) Capacity Charge (Annual Fixed Charges) a. Return on Equity (15.5% +0.5% for timely completion) b. Interest on Loan (weighted average rate of interest applied on normative average loan) c. Depreciation (For 90% of Capital Cost on straight line method, Rate of depreciation applied for first 12 years in straight line method and subsequently spread equally for the remaining useful life) {Rates of Depreciation are as per sl. No.} d. O&M expenses {as per Op. norms depending on vintage, technology etc.} 2) Interest on Working Capital Cost of Secondary Fuel Special Allowance in lieu of R&M to extend beyond Useful life Energy Charge (Variable Charges) a. Primary Fuel cost b. Lime stone consumption cost where applicable Working Capital: 1 Cost of Primary fuel {1.5 months stock for pit head, 2 months for non- pithead stations, 1 month for Gas} 2. Cost of Secondary fuel {2 months of normative requirement} 3. O&M expense of 1 month 4. Maintenance spares (as a % of O&M exp) {Thermal 20%, Gas 30%, Hydro 15%, transmission 15%} 5. Two months receivables of capacity charge and Energy charge Interest on Working Capital: Short term Prime Lending Rate of State Bank of India as on 1.4.2009 or on 1st April of the year of CoD on normative basis whether loan is taken or not. . 4.0 Availability Factor computation for various systems: 4.1 Norms for recovery of Annual Fixed Charges: Full recovery : if Availability>=Normative Availability Factor Pro-rata recovery (upto70%) : if Availability <Normative Availability Factor Incentive and Full Recovery : if Availability >Normative Availability Factor

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4.2 Computation of Availability Factor i) For Thermal Plants Plant Availability Factor for Month or Year 96 PAFM or PAFY = 10000 x DCi / { N x IC x ( 100 - Aux ) } % i=1 Where, Aux = Normative auxiliary energy consumption in percentage. DCi = Average declared capacity (in ex-bus MW), For Thermal stations DCi, subject is to clause 21(4) of Regns. given below : (4) In case of fuel shortage in a thermal generating station, the generating company may propose to deliver a higher MW during peak-load hours by saving fuel during off-peak hours. The concerned Load Despatch Centre may then specify a pragmatic day-ahead schedule for the generating station to optimally utilize its MW and energy capability, in consultation with the beneficiaries. DCi in such an event shall be taken to be equal to the maximum peak-hour expower plant MW schedule specified by the concerned Load Despatch Centre for that day. ii) For Hydel Plants Capacity Charge = AFC x ( NDM / NDY ) x ( 0.5 + 0.5 x PAFM / NAPAF ) For Hydro stations DCi subject is to clause 22(3 of Regns. given below : The Capability which the station can deliver for at least three (3) hours, as certified by the nodal load dispatch centre after the day is over. iii) Availability Factor of Tr. Systems Before calculating Availability Factor of Tr. Systems, its Non Availability Factor for the month (NAFM) is calculated based on the Outage Hours and Capacity ( For line-ckt km, for transformers- MVA capacity of, for Shunt Reactor -MVAR capacity) divided by the total no of hours, and total of ckt km plus capacity of transformers and reactors. For HVDC, the Non Availability Factor for the month (NAFM) is calculated by Transmission Capacity Reduction (TCR) as a factor of Rated Capacity. Transmission Availability Factor for the month TAFM = (100 100 x NAFM) 4.3 Computation of monthly Capacity charges payable Let AFC = Annual fixed cost specified for the year, in Rupees. NAPAF = Normative annual plant availability factor in percentage NDM = Number of days in the month NDY = Number of days in the year PAFM = Plant availability factor achieved during the month, in percent:

152

PAFY

= Plant availability factor achieved during the year, in percent

4.3.1. For Thermal Gen. Stns. less than ten (10) years old: Monthly capacity Charges = AFC x (NDM /NDY) x (0.5 + 0.5 x PAFM / NAPAF ) In case the plant availability factor achieved during a financial year (PAFY) is less than 70%, the total capacity charge for the year shall be restricted to: AFC x (0.5 + 35 / NAPAF ) x ( PAFY / 70 ) (in Rupees). 4.3.2. For Thermal Gen. Stns. Older than ten (10) years: Monthly capacity Charges = AFC x ( NDM / NDY ) x ( PAFM / NAPAF ) 4.3.3 For Hydel Plants Monthly capacity Charges = AFC x 0.5 x NDM / NDY x (PAFM / NAPAF) 4.3.4. For Transmission charges of ISTS : Monthly transmission Charges = AFC x (NDM / NDY) x (TAFM / NATAF) Where TAFM= Transmission system Availability Factor for the Month NATAF = Normative Annual Transmission Availability Factor 5. Energy Charges Rate: The Energy Charge Rate shall cover the primary fuel cost and limestone consumption Let Aux = Normative auxiliary energy consumption in percentage. CVPF = Gross calorific value of primary fuel as fired, in kCal per unit CVSF = Calorific value of secondary fuel, in kCal per ml. ECR = Energy charge rate, in Rupees per kWh sent out. GHR = Gross station heat rate, in kCal per kWh. LC = Normative limestone consumption in kg per kWh. LPL = Weighted average landed price of limestone in Rupees per kg. LPPF = Weighted average landed price of primary fuel, in Rupees per unit SFC = Specific fuel oil consumption, in ml per kWh. 5.1 For Coal based and Lignite fired stations ECR = { (GHR SFC x CVSF) x LPPF / CVPF + LC x LPL } x 100 / (100 Aux) 5.2 For gas and Liquid fuel based stations ECR = GHR x LPPF x 100 / {CVPF x (100 Aux)} 5.3 For Hydel Plants ECR = AFC x 0.5 x 10 / { DE x ( 100 Aux ) x ( 100 FEHS )}

153

Where, DE = Annual design energy specified for the hydro generating station in MWh, FEHS = Free energy for home State, in per cent (12%) 6. Operational Norms Operational norms (Ceiling norms) are specified to determine the component of tariff as per applicable rates for a particular type of station/unit depending on the class it belongs. These norms are specified based on the following criteria: a) Type of fuel (Coal/Lignite/ /Gas/ /hydro/ reservoir based /Run off river with/without pondage etc), b) Vintage of the units (depending on the age of machines relaxed op norms are applied) c) Technology of the unit, (CBFC / CCGT /super critical etc) d) Location of the plant (pit-head, Non-pit head) e) Size of machine (210MW/300MW/500MW/600MW) f) Voltage level of Transmission system (132kV/220kV/400kV/765kV/HVDC etc)

6.1 Normative annual plant availability factor For Thermal station of NTPC: Talcher-I = 82%, Badarapur=82%, Other Thermal station of NTPC = 85% For Thermal station of NLC: NLC TPS-I=72%, TPS-II Stage-I & II =75%, TPS-I (Expansion) 80% Normative Annual Transmission System Availability Factor (NATAF) shall be as under: (1) AC system: 98% (2) HVDC bi-pole links: 92% (3) HVDC back-to-back Stations: 95% 7.0 Example for Tariff computation for a substation: Let Capital Cost of the Project : Rs 100 Cr Let Debt : Equity Ratio : 70 : 30 Loan (Debt) Amount : Rs 70 Cr Equity Amount : Rs 30 Cr a) Base rate Return on Equity =15.5%, Minimum Alternate Tax (MAT) =11.33% RoE (pre-tax RoE) = 15.5*(1-11.33%) = 17.481% Return on Equity = 30 x 0.17481 b) Let rate of interest =9.05%, Interest on Loan : Rs. 70Cr x (9.05%)

: = 5.24 Cr = 6.65 Cr

154

c) Depreciation @ 5.28% {Building: 3.34%, TL/SS: 5.28% , PLCC: 6.33 % and balance spread over after 12 Years}) Depreciation: 100 x 0.0528

= 5.28 Cr

d) O&M expenses for Bays : 4 No of bays * 52.40 Lakh/Bay (400kV) O&M expenses for Line : 75 Km * 0.627 Lakh/km (400kV D/c Twin) O&M Expenses for the substation = 2.57 Cr e) Working Capital =2 Month Receivables + 1 Month O&M expenses + 15% O&M expenses for spares = [2*(a+b+c)/12 + d/12] Interest on Working Capital @ 12.25% = 0.43 Cr st (Short-term Prime Lending Rate of SBI as on 1 April of FY) Total Tariff (a+b+c+d+e) = Rs. 20.17 Cr / year 8. Sharing of transmission charges Regional Transmission system: to be shared on Postage stamp method based on Wt. Avg. Entitlement from ISGS. Inter-Regional Transmission Links: Links with ER (other than NER) to be borne only by the regions connected to ER. Links between SR-WR, NR-WR and ER-NER to be shared on 50:50 basis between both regions. These charges to be shared on Postage stamp method based on Wt. Avg. Entitlement. After the PoC charge Regulation comes in to force, sharing would be by both ISGS and their Beneficiaries as per Approved Injection or Approved Withdrawl at the applicable PoC rates. 9. Benchmarking for prudence check by CERC: As per National Tariff policy, CERC has to develop benchmarks for capital cost before approving tariff. Accordingly in line with Clause 7(2) of the TCT regulations, for carrying out prudence checks, the following benchmark of capital costs were notified. 1) Model for Benchmarking Capital Cost of Thermal Power Stations. 2) Model for Benchmarking Capital Cost of Transmission system.

10. Amendments : These Corrigendum and addendum for the Regulations were issued as given below: 1) CORRIGENDUM 10 June 2009 2) ADDENDUM 10 June 2009

155

The above study material is a gist of the Regulations. For proper understanding of the Regulations are to be studied in detail. Similarly, for understanding the intent of the Commission in various provisions, Statement of reasons or Explanatory memorandum of the Regulations have to be studied. References : 1) Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2009 (http://cercind.gov.in/Regulations/Terms-andConditions-of-Tariff-Regulations_2009-2014.pdf) 2) Statement of Objects and Reasons for Terms and Conditions of Tariff regulations (http://www.cercind.gov.in/2009/February09/SORregulations-on-T&C-of-tariff-05022009.pdf) 3) Indian Electricity Grid Code 2010 (http://cercind.gov.in/Regulations/Signed-IEGC.pdf) 4) CERC order dt Benchmarking of Thermal projects (http://www.cercind.gov.in/regulation/Tharmal_Benchmarking.html) 5) CERC order dt Benchmarking of Transmission projects (http://cercind.gov.in/2010/ORDER/April10/Final_Order_for_notification _TL_Benchmarking.pdf) 6) http://cercind.gov.in/Regulations/Amend_Renewable_Energy_tariff.pdf 7) CERC (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2009. (http://cercind.gov.in/Regulations/Amend_Renewable_Energy_tariff.pdf) 8) Tariff Notification for Generating Companies Govt. of India http://www.powermin.nic.in/acts_notification/tariffnotification_generating companies.htm

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TABLE OF CONTENTS Topic Introduction Purpose Classifications Voltage Class and rating Planning of Substation Installations Types of Substations Substation Engineering Switching Schemes Bus bar Electrical Safety Clearances Single Line Diagrams Substation Layout Insulation Coordination Earth mat requirement Insulators Illumination

No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

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EHV AC Substations: Layout, Equipment, Bus arrangements 1.0 Introduction: The economics of generation of electrical energy & the demand for power has necessitated installation of large hydroelectric stations, thermal power plants & gas based plants. Normally these plants are to be as nearer to load centers as possible in order minimize transmission losses. However the large hydroelectric stations are located far from the load centers where as thermal & gas power plants are in the midst of load centers. 2.0 Purpose: 2.1 The substations are very much essential to a) Evacuate power from generating stations. b) Transmit to the load centers. c) Distribute to the utilities & ultimate consumers. 2.2. The Electrical power generation from Hydel, Thermal, Nuclear and other generating stations has to be evacuated to load centers. The generation voltage is limited to 15/18 KV due to the limitation of the rotating machinery. This bulk power has to be stepped up to higher voltages depending on quantum of power generated and distance to the load centers. Again the power has to be stepped down to different lower voltages for transmission and distribution. 2.3 In between the power houses and ultimate consumers a number of Transformation and switching stations have to be created. These are generally known as sub-stations 3.0 CLASSIFICATIONS The substations are classified as a) Generating substations called as step up substations b) Grid substations c) Switching stations d) Secondary substations 3.1. The generating substations are step up stations as the generation voltage needs to be stepped up to the primary transmission voltage so that huge blocks of power can be transmitted over long distances to load centers. 3.2 The grid substations are created at suitable load centers along the primary transmission lines. 3.3 Switching stations are provided in between lengthy primary transmission lines: a) To avoid switching surges. b) For easy segregation of faulty zones. c) For providing effective protection to the system in the A.C. network.

158

d) The switching stations also required wherever the EHT line are to be tapped and line to be extended to different load centers without any step down facility at the switching stations. e) The number of outgoing lines will be more than the incoming lines, depending on the load points. 3.4. Secondary substations are located at actual load points along the secondary transmission lines where the voltage is further stepped down to: a) Sub transmission voltages b) Primary distribution voltage. c) Distribution substations are created where the sub-transmission voltage and primary distribution voltage are stepped down to supply voltage and feed the actual consumers through a network of distribution and service line 4.0. VOLTAGE CLASS AND RATINGS Generally the following voltage class substations prevailing in India a) 6.6 KV, 11 KV, 22KV. ---------- Primary distribution Voltage b) 33 kV, 66KV, 110/132KV, -------High voltage c) 220/230KV , 400 KV, 765 kV ---------- Extra high Voltage 5.0 PLANNING OF SUBSTATION INSTALLATION 5.1 The process of planning sub-station installations consists in a) Establishing the boundary conditions. b) Defining the plant concept, type, & Planning principles. 5.2 The boundary conditions are governed by following environmental circumstances & availability of the land in the required place. a) Local climatic factors b) Influence of environment c) The overall power system voltage level d) Short circuit rating e) Arrangement of neutral point f) The frequency of operation g) The required availability or reliability h) Safety requirements i) Specific operating conditions 6.0. Types of substations: a) Out- door- Conventional Air insulated substations (AIS) b) In door substations c) Compressed Air insulated d) Gas insulated substations (GIS ) 6.1 The types of Sub Stations depends upon: a) The availability of the land in the required place. b) Environmental conditions.

159

7.0. Sub-Station Engineering. 7.1. The Sub Station Engineering comprises, a) Sub-station site selection b) Bus switching schemes. c) Bus-Bar: i. Type. ii. Size d) Safety clearances. i. Phase to phase clearances. ii. Phase to ground clearances. e) Sectional clearance. f) Ground clearance. g) Bus levels. i. First level ---- Equipment interconnection level. ii. Second level ---- Bus levels. iii. Third level ---- Cross Bus / Jack Bus level. h) Bay widths i) Yard levels. j) Single line diagram & Layout. k) Lightning protection. l) Earth mat. m) Civil Engineering works: i. Control Room ii. D.G & Fire fighting room. iii. Cable ducts iv. Foundations of all equipments & Mounting structures v. Yard leveling vi. Approach Roads & Roads inside the substation vii. Security fencing & boundary wall. viii. Water supply & drainage ix. Colony x. Anti weed treatment xi. Spreading of Jelly ( broken stones) in the substation yard n) Electrical Installation works: i. Station structures: Tower, Beams, Equipment mounting structures, Lightning cum Lighting masts, Bus bar formation, Insulators, clamps & connectors, corona rings & rubber mats, etc o) Main electrical equipments: i. Power Transformers (ICTs). ii. Circuit breakers. iii. Shunt & Bus Reactors. iv. Reactive compensation. v. Instrument Transformers vi. Isolators vii. Lightning / Surge Arrestors viii. Control panels ix. Protection & Relay panels. x. P.L.C.C Equipments

160

xi. Control & Power cables. xii. Substation Automation xiii. Fire Fighting equipments p) Auxiliary supplies: i. A.C Supply: ii. D.C. Supply- Battery & Battery chargers iii. D.G Sets iv. A.C & D.C panels / switch Boards 8.0. Switching schemes 8.1 The selection of switching scheme depend upon: a) Reliability factor b) Availability of the space c) Economics (project cost) d) There can be several combinations in which the equipments, bus-bars, structures etc. can be arranged to achieve a particular switching scheme. 8.2 The various types of switching schemes along with its advantages and disadvantages: a) Single Bus arrangement:

ADVANTAGES 1. Simple in Design 2. Less Expenditure

DISADVANTAGES 1. In case of bus fault or bus bar isolator fault or maintenance Total Substation is out of service. 2. In case of maintenance of transformer circuit breaker the associated transformer has also to be shut-down. Similarly for Line also.

161

b) Single Bus with bus sectionaliser:

Main Bus is divided into two sections with a Circuit Breaker and isolators in between the adjoining sections. One complete section can be taken out for Maintenance without disturbing the continuity of other section. Even if a fault occurs on one section of the Bus, that faulty section alone will be isolated while the other section continues to be in service. It will be a little more costly with the addition of one isolator and some cases with Circuit breaker, C.Ts and C&R panel

c) SINGLE BUS & TRANSFER BUS SYSTEM:

T/ F-1

T/ F-2

TRANSFER BUS

BUS-1
BAY1 BAY2 BAY3

L P O C U B E F S N A R T

BAY4

BAY5

BAY6

BAY7

FEEDER1 FEEDER2

FEEDER3 FEEDER4

i.

With this arrangement, all the feeders are normally on the Main Bus Bar. If at any time, a Line Circuit Breaker/ Transformer circuit breaker.Maintenance is required or break down of Circuit breaker or CTs, that particular feeder/ transformer , can be transferred on to the Transfer Bus. The feeder protection thus gets transferred to trip Transfer Bus Coupler Breaker. On fault occurrence or maintenance, entire bus becomes de-energized. 162

ii.

Salient features:

Only one Circuit at a time can be transferred on the Transfer Bus. For Maintenance or on fault occurrence, total Bus becomes dead. d) DOUBLE BUSBAR: There are six types of Bus switching schemes double bus bars i. ii. iii. iv. v. vi. double busbar system. double bus with sectionaliser system. double bus & transfer bus system. double bus & transfer bus with sectionaliser system. one & half breaker system one & half breaker with sectionaliser system

d-i) Double main Bus system ( Bus -1 & Bus-2) & Double main Bus with transfer Bus scheme

Lines Lines Lines

Lines

Main Bus1 Main Bus Transfer Bus

Main Bus2

Transformer

Transformer

Transformer

Transformer

Main Bus with Transfer Bus

Double Main Bus

19

Double main bus: This system has got flexibility of transferring any Circuit to any of the Bus. For Maintenance or on fault occurrence on one Bus, then only that Bus becomes dead, while the other Bus remains in service. For Maintenance of a Circuit Breaker, that particular Circuit has to be taken out of service. To overcome this, an additional bypass isolator is provided as indicated in figure above

163

Double main bus with Transfer bus:

This system is a combination of Main and Transfer Bus and Double Bus Arrangement. This has got flexibility of transferring any Circuit to any of the Main Buses. For Maintenance or any fault occurrence on a Bus, Particular Bus only becomes dead, while the other Bus continues to be in service. Any Circuit Breaker can be taken out for Maintenance by transferring that circuit to Transfer Bus, and transferring its Protection to Transfer Bus Coupler Circuit Breaker.

164

e) One & half breaker system:

(I-CONFIGUARATION)
FEEDER1 FEEDER3 FEEDER5 FEEDER7 FEEDER9 FEEDER11

BUS-1DI A1

DIA2

DI A3

DIA4

DIA5

DIA6

4 Y A B

1 Y A B

7 Y A B

0 1 Y A B

3 1 Y A B

2 Y A B

5 Y A B

8 Y A B

1 Y A B

4 1 Y A B

3 Y A B

6 Y A B

9 Y A B

2 1 Y A B

BUS-2

FEEDER2

FEEDER4

FEEDER6

FEEDER8

FEEDER10

5 1 Y A B

FEEDER12

165

8 1 Y A B

7 1 Y A B

6 1 Y A B

This system has 3 Circuit Breakers for Two Circuits.( One is Line another is Transformer or Bus Reactor or both are Lines) No changeover of Line from one Bus to the other is required. For Circuit Breaker Maintenance of any Line, the load gets transferred automatically to the other bus. For Maintenance or an occurrence of a Bus fault, all the interconnections will be on healthy bus and no disturbance to the Circuits. Even if both Buses become dead, Circuits can still be in service through the Tie Circuit Breaker. This has got many such advantages to maintain the system stability. f) Double Bus & Double breaker system

DOUBLE BUS & DOUBLE BREAKER SYSTEM

FEEDER1 FEEDER3 FEEDER1 FEEDER3

BUS-1

2 Y A B

1 Y A B

1 Y A B

3 Y A B

5 Y A B

7 Y A B

BUS-1 BUS-2

4 Y A B

6 Y A B

2 Y A B

8 Y A B

4 Y A B

5 Y A B

3 Y A B

BUS-2

FEEDER2

FEEDER4

FEEDER2

7 Y A B

FEEDER4

FOR ECONOMICAL& RELIABULITY PURPOSE THIS SYSTEM ADOPTED IN 800KV SYSTEM

Greatest operational flexibility , Greatest operational flexibility , Connection possible to either bus bar, Each breaker can be serviced without completely disconnecting the branch, High Reliability, Most expensive as it involves additional breaker, CT Isolators etc for each circuit .

166

8 Y A B

6 Y A B

g) Ring Bus in a substation:

Flexibility for breaker maintenance, Each breaker removable without disconnecting load, Only one breaker needed per branch, Each branch connected to network by two breakers, All change-over switching done with circuit-breakers & hence flexible. 9.0. Bus bar: a) Type of Bus bars Strung Bus/Flexible Bus and Rigid Tubular Bus b) Strung Bus: The various Types of conductors used for Strung Bus are All Aluminum conductor (AAC) All Aluminum alloy conductor (AAAC) Aluminum conductor with aluminum alloy reinforced (ACAR) iv. Aluminum conductor with steel reinforced (ACSR) c) Rigid tubular conductors are also used in substations, which are more advantageous than the flexible conductors i. ii. iii. d) Sizes of Bus Bar The important factors for selection of the conductor sizes in a substation are, i. ii. iii. iv. Normal current carrying capability Short circuit heating with stand capability Surface gradient Corona free performance

10.0 Electrical safety clearances: a) The various clearances which need to be defined. 167

i. ii. iii. iv. v.

Phase-to-earth clearance. Phase-to-phase clearance. Sectional clearance. Ground clearance. Equipment to equipment spacing

b) The electrical and safety clearances to be adopted in substation are governed by following parameters. i. Basic Impulse Insulation levels (BIL). ii. Basic Switching Impulse level (BSL). iii. IE Rules. iv. Allowances in tolerance in dimensions of structural work. v. Safety margins for unforeseen errors c) The standard clearances for various voltage classes; Standard Clearances and Bay Widths 220 kV Particulars 765 kV 400 kV Rigid Bus 14 3.65 3.35 5.5 4.3 Strung Bus 17 5 3.5

Bay width (in mtrs) Phase to Phase Clearance (in mtrs) Phase to earth clearance (in mtrs) Ground clearance (in mtrs) Sectional clearance (in mtrs)

45 12 10.5 12 10

27 7 6.5 8 6.5

11.0 Single Line Diagrams: a) This diagram indicates the proposed bus bar arrangement and relative positions of various equipments. There are numerous variations of bus bar arrangement. b) The choice of a particular arrangement depends on various factors viz. System voltage, position of the substation in the system, flexibility, expected reliability of power supply and cost. c) The following technical consideration must be borne in mind while deciding upon any one arrangement.

168

i. ii. iii. iv. v. vi.

Simplicity is the key note of a dependable system Maintenance should be easy with minimum interruption of supply Safety to the operating personnel Alternative arrangement should be available in the event of an outage on any of the equipments or sections of sub station The layout should not hinder for expansion and/or augmentation at a later date, to meet the future load growth The installation should be as economical as possible keeping in view of the requirements and continuity of supply

12.0 Substation lay out: The single line diagram, bus switching scheme, bay widths, section & ground clearances, is to be translated the selected scheme into a layout so as to physically achieve the feeder switching required for ease in erection and maintenance: 13.0 INSULATION CO-ORDINATION: a) Insulation coordination is the total of all measures taken to restrict flash over or break down of the insulation caused by over voltages at places with in an installation at which the resulting damage is as slight as possible. This is achieved by using lightning arresters to limit over voltages. b) The equipments are also to be designed to withstand lightning and switching surges. The nominal lightning impulse withstand voltage and power frequency withstand voltage for various voltage classes are as follows: Maximum voltage of equipments 36 KV 72.5 KV 123 KV Nominal lightning impulse Peak value 170 KVP 325 KVP 550 KVP Nominal power frequency withstand voltage RMS value 90 KV 140 KV 230 KV

245 KV 1050 KVP 460 KV 420 KV 1425 KVP 1050 KVP* * Nominal Switching impulse with stand voltage

c) LIGHTNING PROTECTION: In HV & EHV substations, the protection from the lightning is done either by shield wire or lightning mast (high lattice structure with a spike on top) and sometimes combinations of both depending upon type of layout of substation.

169

Shield wire Shield wire lightning protection system will be generally used in smaller sub stations of Lower voltage class, where number of bays are less, area of the substation is small & height of the main structures are of normal height. The major disadvantage of shield wire type lightning protection is, that it causes short circuit in the substation or may even damage the costly equipments in case of its failure (snapping ). Lightning masts (LM) This type of protection will be generally used in large, extra high voltage sub stations where numbers of bays are more. It has the following advantages, i. It reduces the height of main structures, as peaks for shield wire are not required ii. It removes the possibility of any back flashover with the nearby equipments/structure, etc. during discharge of iii. lightning strokes iv. Provides facility for holding the lightning fixtures in the substation for illumination purposes v. Aesthetic look 14.0 Earth mat requirement: a) The main objective of earthing system in the substation is, i. ii. iii. To ensure that a person in the vicinity of substation is not exposed to danger of electrical shock To provide easy path for fault currents into earth under fault condition without affecting the continuity of service Hence intentional earthing system is created by laying earthing rod of mild steel in the soil of substation area. All equipments/structures which are not meant to carry the currents for normal operating system are connected with main earth mat

The earthing system in a substation serves the following Protects the life and property from over-voltage To limit step & touch potential to the working staff in substation Provides low impedance path to fault currents to ensure prompt and consistent operation of protective device Stabilizes the circuit potentials with respect to ground and limit the overall potential rise Keeps the maximum voltage gradients within safe limit during ground fault condition inside and around substation b) The main earth mat shall be laid horizontally at a regular spacing in both X & Y direction based upon soil resistivity value and short circuit value at substation. The main earth mat shall be designed to limit the following;

170

i.

Touch Potential The potential difference between two points, one on the ground where a man may stand and any other point which can be simultaneously touched by either hand. Step Potential The potential difference between any two points on ground surface which can be simultaneously touched by feet. Maximum ground mat resistance shall be less than 1.0 ohm for substations of 220kV class and below, and shall be 0.5 ohms for 400kV and above voltage class. The earth rods shall be capable of withstanding short circuit current for specified period. For I kA SC current for 1 second the minimum cross sectional area of M.S. Rod / Flat shall be 12.16 sq mm with welded joints.

ii.

iii.

iv. v.

15.0 INSULATORS: a) Types of insulators: Disc type & Post type : i. Disc type System voltage in kV 400 400 220 220 110 Tension Strength in kN 160 120 120 90 90 No. of units per string Tension 25 16 8 Suspension 23 14 8

i. Post type : Pedestal post or stacking type and Solid core type The design considerations are, The phase to earth clearance which determines the height Insulation level Power frequency withstand level Mechanical strength i.e., mainly cantilever strength Minimum creepage dimensions

171

System Voltage in kV 400 220 110 66 33

Height of stack (mm) 3650 2300 1220 770 380

No. of units per stack 3 2 1 1 1

Minimum creepage dimension in mm at 25 mm/kV 10500 6125 3075 1815 900

Cantilever strength (kN) 8 6 4.5 4.5 4

16.0 Illumination: The indoor & outdoor areas of substation are to be properly illuminated. The minimum lux levels to be maintained in the different areas are follows. Area in the Substation Control Room L.T Room Cable Gallery Battery Room Entrance Lobby Corridor Landing Conference Room and Display Room Rest Room Outdoor Switchyard Minimum lux levels to be provided 350 150 150 100 150 150 300 250 Main Equipment..50 Balance Area30 Street/ Road 30

****

172

TABLE OF CONTENTS Topic CEAs standards for Grid Connectivity CEA (Grid Standards) Regulations, 2010 Metering Standards

No. 1 2 3

173

CEA's Standards for Grid Connectivity GRID CONNECTIVITY STANDARDS APPLICABLE TO THE TRANSMISSION SYSTEM 1. Transmission System Planning and Design : i. The Transmission Licensee shall Plan and design the inter-state/ intra-state transmission system based on the following. a. CEA "Manual on Transmission Planning Criteria: 1994". b. CEA "Report of the Committee for Updating the Best Practices in Transmission System in the Country: 2002". c. Latest issue of CBIP Manuals on Layout of sub-stations Transmission Line Tower

d. Grid Code e. State Grid Code ii. The integrity of the regional grid is not affected under various operating conditions including stipulated system contingencies. a. All the elements of the transmission system, i.e. overhead lines, cables and sub-stations, etc., shall be designed taking into account the specified factors of safety in regard to electrical, mechanical and civil aspects in the respective standards. b. Optimal system shall be chosen after load flow, shortcircuit and , stability studies of various transmission alternatives taking into account the following aspects: Projected dispatch scenario of operation to study conditions of possible maximum and minimum power flow through the transmission corridor under study. Optimization of transmission cost and losses Right-of-way consideration

174

 iii.

Optimal utilization resources

of

energy

Grid operation requirements in normal conditions and in contingencies

The system designed shall not impinge on the rating of substation equipment in any other sub-station in the vicinity.

2. Overhead Transmission Lines : i. The transmission line proposed to be connected/connected shall comply with the following : a. Tower design shall be based on the technical standards for construction of electrical lines specified by the Authority under section 73 (b) of the Act. b. Foundation design of the tower shall be developed by the transmission licensee for each soil category as well as river crossing towers along the route length of the transmission line. c. Use of multi-circuit and narrow based towers shall be used wherever right-of-way constraints exist. d. Each type of tower shall be type tested for mechanical strength. ii. Clearance from Power Telecom Coordination Committee (PTCC) shall be obtained.

3. EHV/HV Underground Cables : i. The cable proposed to be connected to the system shall comply with the following a. Shall be of XLPE (Cross linked Poly Ethylene) type corresponding to IS -7098 (Any alternative type of cable developed in due course with same or better performance may be employed after taking clearance from the Authority). b. The cable conductor shall be of adequate size considering Continuous current, short-circuit current, voltage drop etc and shall correspond to IS - 8130 c. Cables shall be provided with suitable sheathing, armoring and screening such that these have the requisite mechanical

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strength and flexibility to withstand the stresses during handling and laying into ducts / trenches. d. Prior permission shall be obtained from the appropriate authority for digging trenches and precautions shall be taken to prevent accidents and to preclude accidental cutting of communication cables, other power cables, water, gas and sewage lines in accordance with the provisions of "Part-VIII of the Act". e. The route maps shall be kept at the substation and markers shall be fixed to trace the cables. f. Road crossing shall be carried out by providing culverts, Hume pipes or Gl pipes. g. Jointing and termination shall be carried out in accordance with the relevant standards. ii. Clearance from Power Telecom Coordination Committee shall be obtained.

4. Sub-Stations : Planning and design of sub stations shall be based on the following : i. ii. iii. iv. Security of supply, extendibility, maintainability and operational flexibility Statutory Safety Requirements. Protection from direct lightning stroke. Switching Scheme:a. 765 kV sub-station: Double Bus Double Breaker 400 kV substation: One and a half breaker scheme or double main and transfer bus bar scheme. 220 kV sub-station: Double Main and Transfer Scheme or Double Main with breaker by-pass scheme. 132 kV sub-station: Scheme. Main and Transfer

b. c. d. v.

Below 132 kV as decided by the licensee.

All new EHT Circuit Breakers shall be of SF 6 type.

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(Any alternative type of circuit breaker developed in due course with same or better performance may be employed after taking clearance from the Authority). Pre insertion Resistors shall be used for 420 kV and 800 kV circuit breakers to control switching surges. vi. vii. viii. ix. Isolators shall be pneumatic or motor operated. Surge arresters shall be of metal oxide type as per IEC 60099. Inter-Connecting Transformers shall be provided with On Load Tap Changers (OLTC). The Control Room shall be extensible. Operation of Circuit breakers, OLTCs, Isolators (220KV and above), shall be possible from the Local panels as well as Panels in the control room Necessary inter locks shall be provided to meet these requirements. All sub-station structures shall be of lattice steel, protected against corrosion by hot dip galvanization. Lightning masts shall be designed for diagonal wind condition. The structures shall conform to IEC 865, IS-875, IS-806, IS-802 and IS-800. Electrical, mechanical and civil designs shall be standardized to the extent possible. Where standards developed by CTU/STU are available, the same may be adopted at the option of the transmission licensee. Power Supply to Sub-Station Auxiliaries : a. AC supply : Two HT supplies shall be arranged from independent sources. One of the two HT supplies shall be standby to the other. In addition, a Diesel Generating set of suitable capacity shall also be provided. b. DC Supply (Applicable to new sub-stations) There shall be two sets of 220V batteries, each equipped with its own charger for substations of 220 kV and above. Each battery shall be of adequate capacity to meet the sub-station requirements. The batteries shall operate in parallel and one being stand by to the other. Facility for changing the duty of the batteries from main to stand by and vice versa shall be made. There shall be two sets of 50V batteries (one being standby to the other) for PLCC System.

x.

xi.

xii.

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For sub-stations of 132 KV and below, one set of battery each may be provided. xiii. For high current, XLPE cables shall be employed. However for LV / MV systems PVC Cables corresponding to IS-1554 could be employed at the discretion of the Transmission Licensees. The cables shall normally be laid in trenches. For buried cables, suitable protection shall be provided. Reliable (PLCC or higher quality) communication link shall be provided on all EHT lines for voice, Fax, protection, telemetry and SCADA. High accuracy standard coupling shall be provided for this purpose. Sub-Station Grounding shall be done in accordance with IEEE-80. The size and number of Interconnecting transformers shall be selected such that outage of one ICT would not overload the remaining ICTs or the underlying system. The stuck breaker condition in the sub-station shall cause disruption of not more than four feeders in 132kV or 220kV system, more than two feeders in 400kV and more than one feeder in 765kV system. In the sub-stations of 220 kV and higher voltage, the Control Room, PLCC Room, Relay Testing Room and Electronic Laboratory shall be air-conditioned.

xiv.

xv. xvi.

xvii.

xviii.

5. Earth Fault Factor : In the event of a point in EHT system of a transmission licensee being earthed, the Earth Fault Factor shall be less than 1.4. 6. Electromagnetic Compatibility : A line or equipment in the transmission system shall not generate excessive electromagnetic field and the Radio Interference Voltage (RIV) shall be within the permissible limits as per relevant standards. 7. Insulation Coordination: i. For-new connections, the CTU / STU/Transmission Licensee shall inform the transmission users seeking connectivity, the Basic Insulation Levels, in the part of transmission system and important parameters of the equipment and ratings of surge arresters in its system adjacent to the connection point. The transmission licensee and users seeking connectivity shall furnish to the CTU / STU, the Basic Insulation Level of the 178

ii.

proposed system/ important items of equipment and the rating of surge arresters adjacent to the connection site, iii. iv. The CTU / STU/ transmission licensee shall determine the ratings of the surge arresters to be installed at the Connection Site. Requisite insulation coordination shall be done by CTU / STU/ Transmission Licensee.

8. Grid Standards : The transmission utility, transmission licensee and load dispatch center shall comply with Central Electricity Authority's Grid Standards.

GRID STANDARDS Central Electricity Authority (Grid Standards) Regulations, 2010. THE GAZETTE OF INDIA, JUNE 26, 2010 (ASADHA 5, 1932) [PART-III-SEC.4] No. 12/X/STD(GRID)/GM/CEA Whereas the draft of the Central Electricity Authority (Grid Standards) Regulations, 2006 was published, as required by Sub-section (3) of Section 177 of the Electricity Act, 2003 (36 of 2003), read with rule 3 of the Electricity (Procedure for Previous Publication) Rules, 2005; Now, therefore, in exercise of the power conferred by sub-section (2) of Section 177 read with Section 34 and clause (d) of Section 73 of the Electricity Act, 2003, the Central Electricity Authority hereby makes the following regulations, namely:1. Short Title, commencement and application:- (1) These regulations may be called the Central Electricity Authority (Grid Standards) Regulations, 2010. (2) Save as otherwise provided in these regulations, they shall come into

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force on the date of their publication in the Official Gazette. (3) 2. These regulations shall apply to the Entities, Appropriate Load Despatch Centres, and, Regional Power Committees. Definitions :(1) In these regulations, unless the context otherwise requires, (a) Act means the Electricity Act, 2003; (b) Appropriate Load Despatch Centre means the National Load Despatch Centre, Regional Load Despatch Centre or State Load Despatch Centre or Area Load Despatch Centre as the case may be; (c) Area Load Despatch Centre means the centre as established by the State Transmission Utility or licensee for load despatch and control in a particular area of the State; (d) Bulk consumer means a consumer who avails supply at voltage of 33 kV or above. (e) condition based maintenance means a set of maintenance actions based on continuous or frequent assessment of equipment condition, which is obtained from either of or a combination of embedded sensors, external tests and measurements; (f) disaster management means the mitigation of the impact of a major breakdown on the system and bringing about restoration in the shortest possible time; (g) Emergency Restoration System means a system comprising of transmission towers or structures of modular construction, complete with associated components such as insulators, hardware fittings, accessories, foundation plates, guys, anchors or installation tools and they like to facilitate quick restoration of damaged or failed transmission line towers or sections; (h) Entity means a Generating Company including captive generating plant or a transmission licensee including Central Transmission Utility and State Transmission Utility or a distribution licensee or a Bulk Consumer whose electrical plant is connected to the Grid at voltage level 33 kV and above; (i) grid disturbance means tripping of one or more power system elements of the grid like a generator, transmission line, transformer, shunt reactor, series capacitor and Static VAR Compensator, resulting in total failure of supply at a sub-station or loss of integrity of the grid, at the level of transmission system

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at 220 kV and above (132 kV and above in the case of NorthEastern Region); (j) grid incident means tripping of one or more power system elements of the grid like a generator, transmission line, transformer, shunt reactor, series capacitor and Static VAR Compensator, which requires re-scheduling of generation or load, without total loss of supply at a sub-station or loss of integrity of the grid at 220 kV and above (132 kV and above in the case of North-Eastern Region); (k) Schedule means schedule appended to these regulations; (l) time based maintenance means inspection, cleaning and replacement of parts of the equipment based on a predetermined time schedule. (m) transient stability means the ability of the power system to maintain synchronism when subjected to a severe disturbance such as a short circuit on a transmission line;

(n) voltage unbalance means the ratio of the maximum voltage deviation of the phase voltage from the average phase voltage to the average phase voltage of the three phases; (2) Words and expressions used and not defined in these regulations but defined in the Act shall have the meaning assigned to them in the Act. (3) Standards for Operation and Maintenance of Transmission Lines.(1) All Entities, Appropriate Load Despatch Centres and Regional Power Committees, for the purpose of maintaining the Grid Standards for operation and maintenance of transmission lines, shall, (a) make all efforts to operate at a frequency close to 50 Hz and shall not allow it to go beyond the range 49.5 to 50.2 Hz or a narrower frequency band specified in the Grid Code, except during the transient period following tripping. (b) maintain the steady state voltage within the limits specified below in Table 1: Table 1 S.No. Nominal System Maximum Minimum Voltage (kV rms) (kV rms) (kV rms) 1 765 800 728 2 400 420 380 3 220 245 198 4 132 145 122 5 110 121 99 181

6 7

66 33

72 36

60 30

(c) ensure that the temporary over voltage due to sudden load rejection remains within the limits specified in Table 2. S.No. 1 2 3 4 Table 2 Nominal System Voltage (kV rms) 765 400 220 132 Phase to Neutral Voltage (kV peak) 914 514 283 170

Provided that for the voltage level below 132 kV, the temporary over voltage limits as given in Table 2 shall be decided by the State Commission in the respective State Grid Code. (d) ensure that the maximum permissible values of voltage unbalance shall be as specified in Table 3 below: Table 3 S.No. Nominal System Voltage Voltage Unbalance (kV rms) (%) 1 765 to 400 1.5% 2 220 2% 3 33 to 132 3% Provided that Bulk consumers shall avoid unbalanced load during operation Provided further, that the distribution licensees shall ensure that, their loads are not unbalanced. (e) provide standard protection systems having the reliability, selectivity, speed and sensitivity to isolate the faulty equipment and protect all components from any type of faults, within the specified fault clearance time and shall provide protection coordination as specified by the Regional Power Committee. Explanation.-For the purpose of this regulation fault clearance time means the maximum fault clearance times are as specified in the Table 4 below, Table 4 S.No. 1 2 Nominal System Voltage (kV rms) 765 and 400 220 and 132 182 Maximum Time (in milliseconds) 100 160

Provided that in the event of non clearance of the fault by a circuit breaker within the time limit specified in Table 4, the breaker fail protection shall initiate tripping of all other breakers in the concerned bus-section to clear the fault in the next 200 milliseconds. (f) operate the system in a such a way that the Grid System is capable of withstanding one of the following contingencies without experiencing loss of stability: (1) outage of one single largest generating unit of the system or (2) outage of a 132 kV Double circuit line or (3) outage of a 220 kV Double circuit line or (4) outage of a 400 kV Single circuit line or (5) outage of a 400 kV Single circuit line with series compensation or (6) outage of 765 kV Single circuit line without series compensation or (7) outage of one pole of HVDC Bipolar line or (8) outage of an Interconnecting Transformer (g) operate the system in a such a way that under any one of the following contingencies, the system remains stable and sustains integrity so that no generator loses synchronism and no part gets isolated from the rest of the system: (1) tripping of a single largest generating unit; or (2) transient ground fault in one phase of a 765 kV Single Circuit Line close to the bus; or (3) a permanent single phase to ground fault in 400 kV single circuit line followed by 3 pole opening of the faulted line; or (4) a permanent fault in one circuit of a 400 kV Double Circuit Line when both circuits were in service in the pre-contingency period; or (5) a transient single phase to ground fault in one circuit of a 400 kV Double Circuit Line when the second circuit is already under outage; or (6) a three-phase permanent fault in a 220 kV or 132 kV line; or (7) a permanent fault in one pole of HVDC bipolar in a HVDC Converter Station. (h) observe the following permissible limits of voltage fluctuation : (i) the permissible limit of voltage fluctuation for step changes which may occur repetitively is 1.5 percent: (ii) for occasional fluctuations other than step changes the maximum permissible limit is 3 percent: Provided that the standard on voltage fluctuations shall come into force concurrently with clause 4 of Part IV of the

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Schedule to the Central Electricity Authority (Technical Standards for Connectivity to the Grid) Regulations, 2007. (3) The transmission licensee shall ensure that the voltage wave-form quality is maintained at all points in the Grid by observing the limits given in Table 5 below: Table 5 S.No. System Voltage (kV rms) 765 400 220 33 to 132 Total Harmonic Distortion (%) 1.5 2.0 2.5 5.0 Individual Harmonic of any particular Frequency (%) 1.0 1.5 2.0 3.0

1 2 3 4

Provided that the standard on Harmonic Distortion shall come into force concurrently with clause 3 of Part IV of the Schedule to the Central Electricity Authority (Technical Standards for Connectivity to the Grid) Regulations, 2007. Explanation : For the purpose of this regulation, Total Harmonic Distortion (VTHD) expressed as percentage, shall be calculated as under,

1 refers to fundamental frequency (50 Hz) n refers to the harmonic of nth order (corresponding frequency is 50 x n Hz) 4. Operation Planning: The Regional Power Committee shall periodically review the performance of the grid for the past period and plan stable operation of the grid for the future, considering various parameters and occurrences such as frequency profile, voltage profile, line loading, grid incident, grid disturbance, performance of system protection schemes and protection coordination. Maintenance Planning : (1) The Regional Power Committees shall, before the commencement of the financial year, prepare an annual maintenance plan for the generating stations and the inter-State transmission system in their respective regions keeping in view the demand pattern and maintenance schedule of the generating units and diversity in demand of the States.

5.

184

(2) The Regional Power Committees shall co-ordinate the annual maintenance plan for Inter-Regional transmission system. (3) The Regional Power Committees shall review and revise the coordinated generation and transmission system maintenance plan in their monthly operating Committee meetings. (4) The State Load Despatch Centre shall in consultation with the concerned transmission licensee, coordinate the annual maintenance plan of Intra-State transmission system taking into account the annual maintenance plan of generating units and inter-state transmission system decided by the Regional Power Committee. (5) The State Load Despatch Centre shall also review and coordinate the maintenance plan of intra-state transmission system for the next month, taking into account the monthly maintenance plan of generating units and inter-state transmission system prepared by the Regional Power Committee for the next month. (6) The generating company or transmission licensee shall, before actual shut down, obtain the approval of the Appropriate Load Despatch Centre. 6. Coordination in Operations : (1) No Entity shall introduce or take out the element of the grid without the concurrence of the Appropriate Load Despatch Centre except in case of imminent risk of safety of plant and personnel in which case it must intimate Appropriate Load Despatch Centre giving reasons therefore. (2) The Appropriate Load Despatch Centre shall inform all affected parties of the outage. 7. Operating Instructions: (1) Every generating company and transmission licensee shall provide written operating instructions for each equipment and operating procedure for sequence of operations of power system equipment in their control room. (2) The operating instructions followed shall not be inconsistent with the manufacturers instructions. (3) The operating instructions and procedures may be revised by the generating company or transmission licensee, as the case may be. 8. Instructions by Regional Load Despatch Centres and State Load Despatch Centres to be recorded: (1) All operational instructions given by Regional Load Despatch Centres and State Load Despatch Centres through telephone, Fax, e-mail, etc shall be given a unique operating code number and every Regional Load Despatch Centre and State Load Despatch Centre shall

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maintain a voice recorder for recording and reproduction of conversation with time tag or stamp. (2) The record of instructions referred to in sub-regulation (1) shall be kept for at least six months. 9. Automatic under frequency Relay .-(1) All Entities shall set their underfrequency (UF) Relays and rate of change of frequency with time Relays in their respective systems, in accordance with the plan made by the Regional Power Committee, to provide adequate load relief for grid security and ensure the operation of these relays at the set frequencies. (2) All constituents shall submit a detailed report of operation of these Relays at different frequencies to Regional Load Despatch Centre and Regional Power Committee on daily basis and the Regional Power Committees shall carry out inspection of these Relays as and when required. 10. Islanding Schemes: (1) The Regional Power Committees shall prepare Islanding schemes for separation of systems with a view to save healthy system from total collapse in case of grid disturbance. (2) The Entities shall ensure proper implementation of the Schemes referred to in sub-regulation (1). Explanation : For the purposes of this regulation Islanding Scheme means a scheme for the separation of the Grid into two or more independent systems as a last resort, with a view to save healthy portion of the Grid at the time of grid disturbance. 11. Categorisation of grid incidents and grid disturbance based on severity of tripping: The categorisation of grid incidents and grid disturbances shall be as follows: (1) Categorisation of grid incidents in increasing order of severity, Category GI-1 - Tripping of one or more power system elements of the grid like a generator, transmission line, transformer, shunt reactor, series capacitor and Static VAR Compensator, which requires re-scheduling of generation or load, without total loss of supply at a substation or loss of integrity of the grid at 220 kV (132 kV in the case of North-Eastern Region); Category GI-2 - Tripping of one or more power system elements of the grid like a generator, transmission line, transformer, shunt reactor, series capacitor and Static VAR Compensator, which requires re-scheduling of generation or load, without total loss of supply at a sub-

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station or loss of integrity of the grid at 400 kV and above (220 kV and above in the case of North-Eastern Region). (2) Categorisation of grid disturbance in increasing order of severity: Category GD-1: When less than ten per cent. of the antecedent generation or load in a regional grid is lost; Category GD-2: When ten per cent to less than twenty percent of the antecedent generation or load in a regional grid is lost. Category GD-3: When twenty per cent. to less than thirty percent of the antecedent generation or load in a regional grid is lost; Category GD-4: When thirty per cent to less than forty percent of the antecedent generation or load in a regional grid is lost ; Category GD-5: When forty percent or more of the antecedent generation or load in a regional grid is lost. Explanation: For the purpose of categorisation of grid disturbances, percentage loss of generation or load, whichever is higher shall be considered. 12. Reporting of events affecting grid operation: (1) Any tripping of generating unit or transmission element, along with relay indications, shall be promptly reported by the respective Entity to the Appropriate Load Despatch Centre in the reporting formats as devised by the Appropriate Load Despatch Centre. (2) The Appropriate Load Despatch Centre shall promptly intimate the event to the Regional Load Despatch Centres and State Load Despatch Centres of the affected regions and States respectively which shall, in turn, take steps to disseminate this information further to all concerned. 13. Reporting of grid disturbance: (1) The Regional Load Despatch Centre shall inform occurrence of the grid disturbance to the constituents immediately and to the concerned Regional Power Committee at the earliest. (2) The grid disturbance resulting in failure of power supply to large areas in a State shall also be reported by the Regional Load Despatch Centre to the Authority within twenty four hours of the occurrence of the grid disturbance. (3) The Regional Load Despatch Centre shall also post on its website a brief preliminary grid disturbance report, indicating the affected area

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or system, extent of outage and the likely cause of initiation for the benefit of the constituents of the region. 14. Restoration of grid following grid incident and grid disturbance: (1) The Regional Load Despatch Centre, in consultation with Regional Power Committee, shall develop procedures for enabling restoration and normalisation of the Grid for inter-State system at the earliest, following grid incident and grid disturbance of the categories specified in regulation 11. (2) The State Load Despatch Centre shall also develop procedures accordingly for restoration of intra-State system. (3) The restoration procedures shall be reviewed following any addition of generating station or transmission line or at least once in two years, and revised, if considered necessary by the Regional Load Despatch Centre and State Load Despatch Centre, as the case may be. (4) The procedures specified in sub-regulations (1), (2) and (3) shall be made available to, and be followed by all concerned Entities, Regional Load Despatch Centres and State Load Despatch Centres. 15. Operational Data during normal operation and during grid incidents and grid disturbances: (1) All real time operational data as required by the Appropriate Load Despatch Centre shall be furnished by the Entities. (2) All data required by Regional Power Committee, in discharge of the responsibilities assigned to it, shall be furnished by Regional Load Despatch Centre (RLDC). (3) All operational data, including disturbance recorder and event logger reports, for analysing the grid incidents and grid disturbance and any other data which in its view can be of help for analysing grid incident or grid disturbance shall be furnished by all the Entities within twenty four hours to the Regional Load Despatch Centre and concerned Regional Power Committee. (4) All equipment such as disturbance recorders and event loggers shall be kept in healthy condition, so that under no condition such important data is lost. (5) A real time operation display of the grid position shall also be made available to the Regional Power Committee by Regional Load Dispatch Centre. (6) Regional Load Dispatch Centre shall classify the grid incidents and grid disturbances according to regulation 11, analyse them and furnish periodic reports of grid incidents and grid disturbances to the Regional Power Committee which shall recommend remedial measures to be taken on the Report of Regional Load Despatch

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Centre to prevent recurrences of such grid incidents and grid disturbances. 16. Operational Data Records: (1) Operational data including equipment and system parameters logged manually and electronically shall be preserved for at least three years. (2) Logbooks shall be maintained by every manned switchyard and substation or at the control centre responsible for operation of the unmanned switchyard and substation. (3) All operations conducted shall be recorded in chronological order and the time of each operation and occurrence of each event shall be recorded in such a manner that there shall be no over-writing and any mistake shall be neatly cut by a line and new words written thereafter. (4) The observations made during inspection including important parameters and deviation of parameters outside permissible tolerances shall also be recorded in the logbook and all entries must be made in the logbooks immediately. (5) A record shall be kept of the number of grid incidents and grid disturbances of various categories by the respective Regional Power Committees for each financial year. (6) A compendium of grid disturbances, indicating details such as the date and time of the disturbance, the sequence of tripping, the cause, and the sequence of restoration, remedial measures taken to avert recurrence of such incidents and disturbances shall be maintained by the respective Regional Power Committee. 17. Communication facilities: The communication facilities installed by the transmission licensees shall be in accordance with Central Electricity Authority (Technical Standards for Connectivity to the Grid) Regulations, 2007 and shall be maintained in good operating condition. 18. Safety Procedure: (1) The Entity shall prepare contingency procedures for use of operators at each sub-station and switchyard and these shall be regularly updated. (2) All operating personnel shall be trained in contingency procedures at regular intervals and the entities shall require their personnel to follow the contingency procedures during operation and maintenance. (3) The fire fighting equipment shall be made available at all sub-stations, switchyards and converter stations and shall be checked periodically for its upkeep and mock exercises in fire fighting shall be carried out at least once in a year and record maintained.

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19. Maintenance of Tools and Equipment: The maintenance staff shall be made aware of the list of tools, devices and equipment for various maintenance and rectification works on transmission lines, sub-stations, switchyards and converter stations and the tools shall be made readily available and certified for usage. 20. Maintenance Procedures: The Entity shall prepare maintenance procedures for each equipment, in line with the manufacturers recommendations and prudent utility practices. 21. Hot Line Methods: (1) The hot line techniques for maintenance of critical transmission lines and sub-stations shall be adopted wherever possible. (2) Only trained staff shall be used for the hot line techniques and the tools employed in such techniques shall have necessary certification from a national or international accredited laboratory before usage. 22. Emergency Restoration System: Each transmission licensee shall have an arrangement for restoration of transmission lines of 400 kV and above and strategic 220 kV lines through the use of Emergency Restoration System in order to minimise the outage time of the transmission lines in case of tower failures. 23. Inspection and Patrolling: (1) All essential parameters, which indicate the healthiness of the equipment in a sub-station, shall be inspected by the shift engineer once in each shift and periodically by the officer-incharge. (2) Overhead lines shall be patrolled at periodicity decided by the transmission licensee and different patrolling schedules shall be implemented by the transmission licensees for normal terrain, vulnerable terrain and most vulnerable terrain. (3) The patrolling schedules for ground inspection of live lines and tower top inspection of de-energised lines shall be separately issued by the licensees. (4) The important lines shall be inspected by senior engineers after patrolling by junior staff and maintenance works such as tree cutting and replacement of damaged insulators shall be carried out immediately after patrolling, wherever required. 24. Maintenance schedules: (1) Entities shall identify critical equipment and as far as possible, practice condition based maintenance for such equipment in place of traditional time based maintenance. (2) In case of time based maintenance, the periodicity of maintenance of lines shall be fixed based on whether they are passing through normal area or polluted area or coastal area and the transmission lines and

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sub-stations in polluted or coastal areas shall be maintained more frequently. (3) The maintenance of lines passing through and sub-stations located in such areas should be completed once before onset of winter so as to minimise tripping under conditions of fog or due to salt deposit on insulator discs in coastal areas and once before onset of summer. (4) Maintenance and cleaning of various equipment fittings, accessories, primary instruments and sensors shall be carried out when they are de-energised during the shut-down of main equipment so as to minimise shutdown time. (5) Where defects are observed through condition monitoring or during patrolling and inspection, the maintenance work on various items of equipment may be advanced depending on the condition of the equipment. 25. Use of diagnostic techniques for condition monitoring of equipment . The diagnostic methods of maintenance shall be preferred over traditional time based maintenance. For purpose of this regulation, devices or methods specified in the Schedule shall be used. 26. Thermo vision scanning: The Thermo-vision scanning for hot spots on all overhead lines and sub-station equipment at voltage level of 220 kV and above shall be carried out at least once a year and necessary remedial measures shall be taken where hot spots are detected. 27. Failure analysis: (1) All failures of equipment and tower collapse shall be analysed by the Entity to avoid recurrence and a copy of the report shall be submitted to the Regional Power Committee and the Authority. (2) The Authority may appoint a group of experts for investigation and analysis and the representatives of manufacturers may be invited to participate in such analysis. (3) All relevant data which may help the group of experts in analysing the failures shall be furnished by the respective Entities. (4) The recommendations of the group of experts shall be submitted to the Authority and the recommendations accepted by the Authority shall be implemented and circulated to all within the organisation and to other concerned organisations to prevent recurrence of similar failures. 28. Inventory control and spare part management: (1) The required spare parts shall be kept in stock, to ensure speedy the maintenance of the equipment.

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(2) Computerised materials management system shall be developed by the Entities to optimise inventory. 29. Maintenance Audit: (1) An internal committee may be established by the Entities to verify whether actual maintenance works are carried out at site in compliance of the procedures and the policy of the transmission company. (2) The observations of the Committee shall be put up to the management of the Entity for perusal and taking corrective action, if any. 30. Residual life assessment : The residual life assessment shall be carried out for all major equipments including transformers, reactors, breakers, as envisaged by the relevant standards specified by the Bureau of Indian Standards, manufacturers instruction or industry best practices and suitable remedial action for breach of the same shall be taken by the management of the Entity. 31. Disaster management : (1) The maintenance staff shall be trained in disaster management and a detailed procedure for the same shall be developed by the Entity and displayed prominently. (2) This detailed procedure shall be reviewed periodically and also based on mock exercises carried out by the Entity. (3) The maintenance staff shall be trained in emergency restoration procedures for managing major failures and breakdowns. (4) The equipment including vehicles, diesel generating sets and fire fighting equipment and Emergency Restoration System for transmission lines shall be kept available at sub-station or at appropriate location for disaster management. 32. Maintenance records: The records of all maintenance carried out for each equipment shall be kept in the table and formats in electronic form and hard copy and the next due date for maintenance of each item of work shall be clearly marked in such tables and formats. 33. Training: (1) Every person involved in operation and maintenance of transmission lines shall be trained at the induction level and at least once in a year. (2) The shift staff shall be trained to make them thorough in carrying out operations at each sub-station and every person concerned with real time operation shall be trained. (3) Every grid operator shall undergo training in real time digital simulator and a refresher course at least once in two years.

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(4) The maintenance personnel of every entity shall also be trained in preventive and breakdown maintenance of various equipment and the personnel shall be trained in various detailed maintenance procedures. . Secretary Central Electricity Authority

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SCHEDULE (See regulation 25) The Devises and Methods for Condition Based Monitoring of Equipment (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17) (18) (19) (20) (21) Hot line puncture detection of insulators Vibration measurement of the line Pollution measurement of the equipment Dissolved Gas Analysis of Transformer oil Frequency response analysis of transformers/reactors Tan and capacitance measurement Circuit breaker operational analyser Dynamic contact resistance measurements of breakers Third harmonic resistive current measurements of surge arresters Recovery voltage measurements of transformers/reactors Vibration measurements of the reactors Steady state and Dynamic testing of protective relays Signature Analysis Partial Discharge measurement for transformers/Gas insulated Switchgear Static resistance meter for circuit breakers, isolators, bus bar joint, earth switches etc. Ground tester for measurement of resistivity of soil and ground resistance Battery impedance test equipment Insulator tester SF6 gas leakage detector and dew point Power quality Analyser Fibre optic cable testing devices

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CEA Regulations, 2004 on Installation and Operation of Meters 1. Short Title, Commencement, Extent and Interpretation: i. These Regulations shall be called the Central Electricity Authority Regulations, 2004 on Installation and Operation of Meters framed as per provisions under Section 177 and Section 55 of the Electricity Act, 2003. These Regulations shall come into force on the date of their publication in the official Gazette of India unless a definite subsequent date is stipulated in particular Regulations or SubRegulations, These Regulations extend to whole of the India except the State of Jammu and Kashmir, In these Regulations, a word expressed in masculine gender includes feminine gender, the singular includes plural and the plural includes the singular, These Regulations shall also extend to local authority, Panchayat Institutions, user's association, cooperative societies, non-governmental organizations or franchisees.

ii.

iii. iv.

v.

2. Definitions: i. ii. iii. "Act" means 'the Electricity Act, 2003'. "Authority" means Central Electricity Authority constituted under Section 70 (2) of the Act. "Appropriate Commission" means Central Electricity Regulatory Commission/State Regulatory Commission as the case may be. 'AC System' means alternating current electricity system wherein the voltage and current waveforms repeat themselves every cycle, which extends to 360 electrical degrees. In each cycle the first half and the second half are opposite in sign. 'Active Energy' means the electrical energy supplied or consumed during a time interval, being the integral of Active Power with respect to time, measured in the units of watt - hours or standard multiples thereof. One Kilo watt - hour is one unit. 'Active Power' means (in an AC System) the electrical power, being the product of voltage, current and cosine of the phase angle between the voltage and current complexors and measured in units of 'watt' (W) or in standard multiples thereof. 195

iv.

v.

vi.

vii.

'Apparent Power' is defined as S=P + jQ where 'S' is the apparent power, 'P' active power, 'Q' reactive power and 'j' 90 operator. The magnitude of Apparent Power = | S | = (P2 + Q2). It is measured in volt - amperes or standard multiples thereof. 'Availability Based Tariff' means a tariff structure based on availability of generating units and having three components viz: Capacity Charges (CC), Energy Charges (EC) or Variable Charges (VC) and charges for Unscheduled Interchange (UI). 'BIS' means Bureau of Indian Standards. 'British Standards' ('BS') 'means standards and specifications approved by the British Standards Institution. 'Contracted Demand' means the maximum active power or apparent power agreed to be supplied by the supplier and reflected in the Agreement executed between the parties. "Consumer" means a consumer as defined in the Act. "Direct Current System" means Direct Current electricity system wherein current flow is unidirectional. "Distribution System" means the distribution system as defined in the Act. "Energy Accounting and Audit" means a process wherein the account of the energy flow to various segments and various category of consumers is prepared and further analyzed so as to determine as to how it has been consumed out of total available quantum over a specified time period. A group of meters are installed at different pre-determined locations in the total power system which, together with the 'Meters for interface Tariff and 'Meters for Consumer', facilitates compiling accurate and detailed database depicting the energy supplied to the consumers and energy lost in various network elements of the total power system, " Extra High Tension (EHT)" means a voltage level exceeding 33000 volts under normal conditions, "Exporter" means any generating company/licensee from whose system electrical energy flows into the system of another generating company/licensee and includes a trader, "Grid Entry Point" means a point at which a generating unit is connected to the Grid,

viii.

ix. x. xi.

xii. xiii. xiv. xv.

xvi. xvii.

xviii.

196

xix.

"High Tension" (HT) means a voltage level exceeding 440 volts and up to 33000 volts under normal conditions (This also includes Medium voltage category). "IS" means the standards published by 'BIS' (Bureau of Indian Standards), "Inspector" means an Electrical Inspector as defined in the Act "Importer" means any generating company/licensee whose system receives electrical energy from the system of another generating company/licensee and includes a trader. "Licensee" has the same meaning as defined in the Act. "Low Tension" (LT) means a voltage level that does not exceed 440 volts under normal conditions, "Meter" means a device suitable for recording and/or indicating consumption of electrical energy or any other quantity related with electrical system. a. "Correct Meter" means a meter which shall have capacity, features, accuracy class and specifications as prescribed in CEA's Standards on Installation and Operation of Meters. b. "Main Meter" means a meter, which shall primarily be used for energy accounting and / or billing. c. "Check Meter" means a meter, which shall be connected to the same core of the Current Transformers (CTs) and Potential Transformers (PTs) to which main meter is connected and shall be used for energy accounting and billing in case of failure of main meter. d. "Standby Meter" means a meter connected to CTs and PTs, other than those used for main and check meters and shall be used for energy accounting and billing in case of failure of both main and check meters. e. "Meter for Interface Tariff" means a meter used for energy accounting and billing, connected at the boundary between the system of an exporter and system of an importer and includes meters connected for the purpose of trading eters for interface tariff shall be suitable for Availability Based Tariff (ABT) in vogue. Hereinafter referred as Special Energy Meters (SEMs).

xx. xxi. xxii.

xxiii. xxiv. xxv.

197

f. "Meter for Consumer" means a meter connected for recording the electrical energy and other electrical quantities drawn from the supply system and utilized by the consumer. g. "Metering System" means meters and wherever applicable associated metering apparatus/equipment such as CTs, PTs. Communication/SCADA equipment etc., necessary for such recording and communication of metered data and shall also include main meter, check meter and/or standby meters which are provided to enable proper accounting, billing, recording and auditing of energy consumption / energy transfer. xxvi. xxvii. "Premises" means any land, building or structure. 'Power Factor' means, the cosine of the electrical angle between the voltage and current complexors in an AC Electrical Circuit. 'Reactive Energy' means, in relation to an AC Electrical System the integral of Reactive Power with respect to time and measured in the units of 'volt-ampere hours reactive (VArh) or in standard multiples thereof. 'Reactive Power' means in relation to AC System the product of voltage, current and the sine of the electrical phase angle between the voltage complexor and current complexor, measured in volt - amperes reactive (VAr) and in standard multiples thereof, 'Regulations' means the CEA Regulations on installation and Operation of Meters, 'Settlement Period' means, in relation to interface tariff metering, the period for which the cost of active energy, reactive energy and maximum demand are calculated, 'Settlement Values' mean the values of active energy, reactive energy, maximum demand and other electrical quantities upon which the tariff system is based, 'Standards' mean "Standards on Installation and Operation of Meters" annexed to these regulations. "Transmission Lines" means transmission lines as defined in the Act. "Transmission System" means a network of transmission lines.

xxviii.

xxix.

xxx. xxxi.

xxxii.

xxxiii. xxxiv. xxxv.

198

xxxvi.

The words and expressions used and not defined in these regulations but defined in the Electricity Act, 2003 shall have the meaning assigned to them in the said Act.

3. Applicability of the Regulations: These regulations shall be applicable to all the generating companies and licensees who are engaged in the business of generation / transmission / trading / distribution/supply of electricity and all categories of consumers. 4. Objectives and Scope: i. Correct measurement of electricity supplied is necessary for accounting and billing of electrical energy. These Regulations cover location, installation, sealing, safety and other general issues in respect of meters falling mainly in the following three categories:

Meters for Interface Tariff Meters For consumers Meters for Energy Accounting and Audit

ii. iii.

The scope of these Regulations covers all new and existing connections/installations. No licensee shall supply electricity, after the expiry of time frame as specified in the Act, except through installation of a correct meter in accordance with these Regulations. For all existing connections, every licensee shall ensure that meters are installed within time frame as specified in the Act. The State Commission, however, by notification may extend this time frame for a class or classes of consumers or for such area as may be specified in that notification.

iv.

5. Standards : All the equipment installed under these regulations shall necessarily conform to the relevant standards as specified in the Central Electricity Authority's Standards on Installation and Operation of Meters annexed herewith and as amended from time to time. 6. Ownership of Meters: Meters for Interface Tariff

199

Meters shall be owned by the Central Transmission Utility (CTU), State Transmission Utility (STU) or licensee. Meters for Consumers: Meters shall be owned and maintained by licensee. Meters for Energy Accounting and Audit: , Meters shall be owned by generating company/licensee. 7. Locations of Meters: Meters for interface tariff: SI. No. A. Generating Station (excluding Captive, Cogeneration, Small generation, NonConventional and Renewable source generation) Stages i. Main Meter HV side of Generator Transformer s. HV side of all Station Auxiliary Transformer s including transformer s for CW system, Ash water recycling system and raw water intake/make up water system. i. Check Meter Standby Meter

HV side of Generator All outgoing Transformers feeders from the . bus. HV side of all Station Auxiliary Transformers including transformers for CW system, Ash water recycling system and raw water intake/make up water system. i. At other end of the. line between the substatio ns of two different licensees .

ii.

ii.

B. Transmission At one end of the System line between the substations.

200

ii.

All inter State/inte r Regional lines.

C. InterHV side of all Connecting ICTs. Transformers (ICTs) D. Captive Generating Plant/CoGeneration Plant At the Grid entry point of the generator. LV side of all ICTs.

At the Grid entry point of the generator.

All outgoing feeders from the bus.

E. Small Generator output Generating terminal. Units/NonConventional and Renewable Source of Generation F. Trading

Generator output terminal.

Purchase/trade point of trader (In case existing meters do not satisfy the requirements, new meters would have to be arranged by the trader in association with the generating company/ licensee/Consumer).

Meters for Consumers: a. LT Consumers: The meters shall be installed by the licensee at consumer's/licensee's premises. The meters shall be connected before the consumer's isolating device (Main Switch), which may be a moulded case circuit breaker, miniature circuit breaker or an ironclad switch fuse unit. b. HT and EHT Consumers: The meters shall be installed by the licensee at consumer's/Licensee's premises. The meters shall be connected before the main switch and the circuit breaker. The meter shall 201

be connected on the supply side of the isolator, i.e. the voltage transformer and the current transformer shall be connected before the isolator. The meters shall be housed in a pilfer proof and weatherproof box or cabinet. In addition the consumer shall provide one isolator and one circuit breaker along with the protective devices for isolating his system from that of the supplier. c. Licensee shall prepare a road map for changing the location of existing meters as per above and implement the same. Meters for Energy Accounting and Audit Meters for energy accounting and audit shall be located in such a manner so as to account for the energy generated, transmitted and distributed in the power system network and supplied to consumer. It will also help in identification of areas of high technical an commercial losses and take remedial measures on a continuous basis. The location of these meters shall be as follows: a. Generating Stations: i. Low voltage side of each Incoming transformer feeder of HT and LT bus from which supply is given to various auxiliary loads. Direct Current Energy Meter between the exciter and rotor. HV side of the Unit Auxiliary Transformer. LV side of the Station Auxiliary Transformer. At a point after the stator terminals and before tapping to the Unit Auxiliary Transformer.

ii. iii. iv. v.

b. Transmission System: All incoming and outgoing feeders (If the meters for interface tariff do not exist) c. Distribution System: i. ii. All incoming feeders, All Outgoing feeders,

202

iii. iv.

Sub-Station Transformer HV and (excluding Distribution Transformer) Distribution Transformer LV side.

LV

side

d. Small Generating Stations: At one or more points such that the internal consumption of energy at the generating station for lighting and auxiliaries and the losses in various components can be obtained. The actual points may be decided by the operator of the small generating stations. The generating companies/licensees may install meters at additional points in their systems. 8. Accuracy Class of Meters: The accuracy class of meters shall be given in CEA Standards on "Installation and Operation of Meters". 9. Installation of Meters: i. ii. Only the correct meters shall be installed at various locations specified in these regulations The meters, which do not have remote meter reading facility through a communication network and computer interface shall be installed at locations, which are easily accessible for installation, testing, commissioning and recording. The place of installation shall be such that minimum inconvenience and disruptions are caused to the site owners and the visiting agencies. In case, CTs and PTs form the part of the metering system, the meters shall be installed as near the instrument transformers as possible to reduce errors due to secondary leads.

iii.

10. Access to Metering Systems : The owner of the premises in/at whose premises, the meters are installed, shall provide access to the authorized representatives of the licensee/traders/generating companies as the case may be for installation, inspection, testing, calibration, maintenance of the metering system and noting down meter readings. They may bring testing equipment and vehicles. Written procedure and protocols shall be prepared by the licensees/traders/generating companies concerned. 11. Sealing of Metering Systems:

203

Sealing Arrangements i. In case of meters for interface tariff sealing shall be done by both the Exporter and the Importer. At each point there shall be two seals - the Exporter's seal and the Importer's Seal. In case of meters for consumers sealing shall be done by the licensee, In case of meters for energy accounting and audit sealing shall be done by the licensee The sealing of all metering systems shall be done at various points (as applicable) to avoid tampering, A tracking and recording software for all new seals shall be provided so as to track total movement of seals starting from manufacturing, procurement, storage, record keeping, installation, series of inspections, removal and disposal. Seal shall be unique for each utility, Only the patented seal (seal from the manufacturer who has official right to manufacture the seal) should be used. Polycarbonate / imported acrylic seals / Holographic seals shall be used, Any other superior seal may also be used with the consent of Appropriate Regulatory Commission, Lead seals shall not be used.

ii. iii. iv. v.

vi. vii. viii. ix. x.

Removal of Seals from Metering Systems: a. Metering Systems for Interface Tariff Whenever seals have to be removed for maintenance, inspection, testing and calibration of meters, the concerned party shall obtain the prior consent of the other party. Only in case of emergency, telephonic consent shall be obtained, which shall be confirmed by the other party in writing. Re-sealing of the meters shall be carried out in the presence of both exporter and importer. If one party is unable to be physically present, it shall inform the same to other party in writing. The breaking and resealing shall be recorded by the party who carried out the work in the Meter Register, mentioning the serial numbers of the broken seals and the serial numbers of the new seals. b. Metering Systems for Consumers

204

Seals shall be removed only by the licensee. A consumer shall not tamper with, break or remove the seal under any circumstances. Any tampering shall be punishable as per part XIV of the Act. c. Metering Systems for Energy Accounting and Audit: Seals shall be removed only by the generating company/licensee who owns the meters. 12. Safety of Meters: i. In case of meters for interface tariff the exporter/importer in whose premises the meters are installed shall be responsible for their safety. Whenever any abnormality is observed it shall be intimated to the exporter/importer and the concerned Load Dispatch Center. The action for not complying with the above shall be taken according to the procedures in force. In the case of the meters for consumer the licensee shall be responsible for its safe custody, if the meters are installed at the premises of the licensee. In case the meters are installed at consumer's premises it shall be the responsibility of the consumer to keep the meter in safe custody. The metering system, meter boards, service mains, MCB/CB, load limiters etc., must, on no account be handled or removed by anyone who is not an authorized representative of the licensee, In case of meters for energy accounting and audit the generating company/licensee who owns the meter shall be responsible for its safe custody, Safety requirements as given in CEA's standard for safety code shall be complied with.

ii.

iii.

iv.

13. Meter Reading and Registers: a. Meter for Interface Tariff It shall be the responsibility of the Appropriate Transmission Utility to record the metered data, maintain a database of all the information associated with the metering system and verify the correctness of metered data and furnish the same to various agencies as per the procedure laid down by the Appropriate Regulatory Commission. The data shall be furnished to the Authority as and when requisitioned. b. Meters for Consumers:

205

i.

It shall be responsibility of the licensee to record the metered data, maintain a database of all the information associated with the metering system and verify the correctness of metered data. The licensee shall maintain accounts for the energy consumption and other electrical quantities of its consumers. Brief history, date of installation and details of testing, calibration and replacement of meters shall be maintained by the licensee.

ii.

iii.

c. Meter for Energy Accounting and Audit It shall be responsibility of the generating company / licensee to record the metered data, maintain a database of all the information associated with the metering system and verify the correctness of metered data. Each generating company/licensee shall prepare monthly and yearly energy account for its system for taking appropriate action for efficient operation and system development. 14. Failure of Meters/Meter Discrepancies: a. Meters for Interface Tariff i. Whenever difference between the readings of the Main meter and the Check meter for any month is more than 0.5% both meters shall be re-calibrated till the difference as per test results is 0.1% or less. In addition to conspicuous failures like burning out and erratic display of parameters, a meter shall be deemed to have failed when the error found in testing is outside the prescribed limits. When the Main meter fails settlement values shall be obtained from the check meter. The Main Meter shall be immediately rectified, reprogrammed and re-calibrated against Reference Standard Meter of 0.05 Class. When both Main and Check meters fail it shall be treated as an emergency and at least one meter shall be rectified and re-commissioned within one day. Billing for the Failure period :

ii.

iii.

iv.

v.

206

a. When the Main Meter fails but the Check meter is working properly, the billing is done based on the Check meter readings. b. When both Main and Check meters fail ABT billing is done based on the meter readings of standby meter. vi. Readings recorded by all Main, Check and Standby meters in each time slot shall be analyzed, crosschecked and validated by the appropriate Load Dispatch Centre (LDC). The discrepancies, if any, noticed in the readings shall be informed by the LDC in writing to the energy accounting agency for proper accounting of energy. LDC shall also intimate the discrepancies to the Appropriate Transmission Utility, who shall take further necessary action regarding testing, calibration or replacement of the faulty meters in accordance with the provisions laid down.

b. Meters for Consumers In case of the meter for consumer, the consumers reports to the licensee about the excessive/less consumption or stoppage of meter, damage to the seal, burning/damage of the meter the procedures as given in the Electricity Supply Code of the Appropriate Commission / arid the agreement of the consumer with the licensee shall be followed. c. Meters for Energy Accounting and Audit: Meters shall be rectified / replaced by the generating company/licensee immediately on noticing the abnormality such as:

Meter readings are outside the limits prescribed for the specified accuracy class. Meter readings are not in accordance with the normal pattern of the load demand. Meter tampering/damage.

15. Anti Tampering Features of Meters: The meters shall be provided with anti tampering features, duly approved by the Appropriate Regulatory Commission. 16. Scheme for Meters for Interface Tariff (SMIT): The 'Scheme for Meters for Interface Tariff' (SMIT) prescribed under these regulations should be submitted to the CTU/STU by the 207

concerned licensee/generating company, at least four months prior to the installation of the SMIT. 17. Type of Meters: All meters shall meet the functional requirements of the regulations. All existing Electro-Mechanical meters which fail to meet the requirement of these regulations shall be replaced in a time frame to be decided by the Appropriate Regulatory Commission. 18. Testing of Meters at Accredited Test Labs: The licensee shall suo moto carry out periodic testing of meters at any accredited test laboratory. 19. Amendment to the Regulations / Standards: The Authority may, as and when considered necessary, amend these regulations, by notification. The Authority may, as and when considered necessary, amend the standards annexed to these regulations by an order.

SCHEDULE Standards on Installation and Operation of Meters PART I: Common To All Type of Meters 1. Standards and Codes of Practice: i. The Licensees / Generating Companies / Consumers shall install equipments covered in Central Electricity Authority's Regulations-2004 on Installation and Operation of Meters complying with the latest version of relevant BIS standards and CBI&P Technical Report. If BIS standards are not available, relevant British Standards, IEC Standard, Standard of American National Standard Institute (ANSI) or any other equivalent Standard shall be followed. Whenever an international standard or IEC standard is followed, necessary corrections shall be made for different system frequency, nominal system voltage, ambient temperature, humidity and other conditions prevailing in India before actual adoption of the standard. The purchaser may specify more stringent conditions for testing during procurement stage and in that case, the meters shall

ii.

iii.

208

conform to technical specifications as prescribed by the purchaser. 2. Power Purchase Agreements: Supplementary detailed standards applicable to particular cases not covered by the Central Electricity Authority (CEA) Regulations and CEA Standards on installation and operation of Meters may be included in the Power Purchase Agreements between any two parties. However, they shall not contravene these Standards and the CEA Regulations. 3. Climatic Conditions: All the equipments covered in these standards shall work satisfactorily under the following climatic conditions: S.No 1. 2. Parameter Temperature Range Max Relative Humidity Value -10C to 50C 95%.

In case the site conditions are more stringent, then the meters shall comply with the specification of the purchaser in this respect.

4. Meters Specifications: Standard Reference Voltage

Without PT operated 240 V (Phase to Neutral) 415 V (Phase to Phase) With PT operated 63.5 V (Phase to Neutral) 110 V (Phase to Phase)

209

Voltage Range Reference Frequency Frequency Range Current Range (It shall be so chosen as to record the load current corresponding to the sanctioned load)

70% to 120% 50 Hz 45-55 Hz Without CT operated

Single Phase 2.5 A, 5 A, 10 A, 15 A and 20 A Three Phase 5 A, 10 A, 15 A, 20 A, 30 A, 40 A, 50 A

With CT operated 1 A and 5 A Accuracy Class (Accuracy to be maintained under wide fluctuations of current, voltage and frequency). a. Meters for Interface Tariff The accuracy of meters for interface tariff shall not be inferior to 0.2 accuracy class. b. Meters for Consumers All new meters shall meet the following requirements of Accuracy Class: Type of Consumer Accuracy Class EHT Consumer HT Consumer LT Consumer (whole current meters) 0.2 0.5 or better 1.0 or better

LT Consumer (CT operated) 1.0 or better

210

c. Meters for Energy Accounting and Audit The accuracy class of meters in generation and transmission system shall not be inferior to that of 0.2 accuracy class. The meters in distribution system shall not be inferior to that of 0.5 accuracy class. Starting Current and Maximum Current Power Factor Range Power Frequency Withstand Voltage Impulse Voltage withstand test for 1.2/50 micro sec Power Consumption As per ISS

0.5 lag-unity-0.8 lead As per ISS

As per ISS

As per ISS

5. Anti Tampering Features: i. ii. The meter shall not get damaged even if any phase and neutral are interchanged, The meter should register energy even when the return path of the load current is not terminated back at the meter and in such a case the circuit shall be completed through the earth. The earth terminal shall be brought out and provided on the outside of the case, The meter shall detect CT polarity reversal (only for CT operated meters) and record the same with date and time of all occurrences and restoration with total number of such occurrences during the above period for all phases, The meter shall work correctly irrespective of the phase sequence of supply (only for poly phase), In the case of 3 phase 4 wire system, the meter shall keep working even in the presence of any two wires i.e., even in the absence of neutral and any one or any two phases,

iii.

iv. v.

211

vi. vii.

In the case of 3 phase 3 wire meters even if reference Y phase is removed, the meter shall continue to work, In case of whole current meters, the meter shall be capable of recording energy correctly even if input and output terminals are interchanged, The registration must occur whether input phase / neutral wires are connected properly or they are interchanged at the input terminals, Meter works on removal of any one or two phases, Meter shall log tampers (as applicable) of:

viii.

ix. x.

PT Missing Current circuit reversal Current circuit short/open

xi.

The meter shall be factory calibrated and shall be sealed suitably before dispatch.

6. Sealing Points: Sealing shall be done at the following points (as applicable): a. CT Secondary Boxes (in addition to locking arrangement) b. PT Secondary Box (in addition to the locking arrangement) c. Meter Cabinet d. Meter Test Block e. Meter Terminal cover f. Meter Cover g. Panel doors where CT and PT secondary circuits are terminated or where possibility for shorting or breaking exists and fuses/links are provided. h. PT selector relay box where automatic changeover of potential i. supply to meter from one PT to another is provided j. CT Primary Links and Top covers k. Maximum Demand (MD) Reset Push Button 212

l. Boxes / Cabinets containing terminals for remote transmission of metered data via communication channels, junction boxes in the system and boxes wherein interface devices are mounted. 7. Immunity to External Factors: The metering system shall be totally immune to external influences like magnetic induction, vibration, electrostatic discharge, switching Transients and Surge Voltages and oblique suspension, harmonics and necessary tests shall be carried out by the supplier. 8. Meter Enclosure: The meter case shall be made of superior quality reinforced poly carbonate, engineering plastic or sheet steel. If sheet metal is used .provision for ear thing shall be made. The case shall be dust-proof, vermin-proof and pilfer-proof. Detailed specifications shall be prepared by the purchaser. 9. Terminal Block, Terminal Screw, Test Block: i. ii. Test terminal block shall be provided to facilitate testing at site. The purchaser shall prepare detailed specifications regarding the terminals, terminal's screws for tightening secondary cable core conductors, terminal cover, terminal block, test block, sealing etc.

10. Current and Voltage Transformers (CTs & VTs): i. ii. iii. iv. The accuracy class of CTs & VTs shall not be inferior to that of associated meters, All the meters including main and check meters shall be connected to same core of CTs/ VTs. The Voltage Transformers shall be electromagnetic VT or Capacitor Voltage Transformer (CVT). The rated burden of the CTs and VTs shall be adequate for connection to the meters, other instruments and telecom equipment at each location and CTs and VTs and shall not be overloaded. The CTs and VTs shall be tested once in 5 years. If they are not replaced after elapsing of the normal life expectancy period, they shall be tested once in every six months thereafter for accuracy of ratios at rated burden.

v.

11. Tests:

213

All Type, Routine and Acceptance Tests shall be carried out as per relevant ISS or purchaser specification whichever is more stringent. PART II: Standards for Meters for Interface Tariff 1. Applicability and Scope: This Chapter (Interface Tariff Metering) applies to Generating Companies (including Independent Power Producers), Transmission Licensees, Distribution Licensees, Electricity Traders, Captive Power Plants, Cogeneration Units and Small Generators (including nonconventional energy generators) who evacuate their generation directly into the distribution systems. 2. General Requirements: i. ii. These meters shall be suitable for availability based tariff and be referred to as Special Energy Meters (SEMs). The metering system shall display and record such electrical quantities and parameters as approved by the Appropriate Commission. The metering system shall meet the requirements included in the Agreement between the Exporter and Importer. Electrical energy transmitted from an exporter's system to an importer's system shall be measured and recorded by installing a standard Interface , Tariff Metering system as near the boundary as possible.

iii. iv.

3. Functional Requirements: i. ii. The meter must perform four quadrant measurement There shall be provision for self-check and diagnosis at regular intervals. The meter shall have indication for unsatisfactory functioning of the following:

Time and Calendar Real Time Clock Battery All Display Parameters Non-volatile Memory

iii.

There shall be programmable facility to restrict access with three level passwords. 214

iv.

On any programme change the meter shall reset itself to zero and the previous information shall be stored in the non-volatile memory. There shall be provision for access to the meter by a computer (desktop, PC or laptop), and remote reading or data storage via communication system. The meter shall log the time and date of all programme changes in a billing period. The meters shall be essentially static tri-vector meters. They shall register in memory and display the following quantities: a. Instantaneous and cumulative Active, Reactive and Apparent power b. Instantaneous and cumulative Active, Reactive and Apparent Energy c. Instantaneous and Maximum I Currents of all phases d. Instantaneous and Maximum Voltages of all phases e. Maximum Active Reactive and Apparent Power f. Instantaneous and Average Voltage and Frequency. g. Instantaneous and Average Power Factor. h. Real time and date. i. Active, Reactive and Apparent energy for the previous month, j. MD reset count number, k. Date of auto MD reset. l. Diagnostic errors and tamper occurrence, m. Harmonic Distortion

v.

vi. vii.

iii.

The meters shall have following facilities: a. Communication: compatible with RS.485 or RS.232. b. Load Survey Capability.

215

c. Missing Potential Alarm and indication in case of failure of potential at the meter incoming terminal. d. Provision for tele-metering using common protocol. e. Provision for collection of data by Meter Reading Instrument (MRI). f. Provision for time-synchronizing facility from external clock. Provision for correcting real time by MRI. g. Sliding Integration Window, h. Real Time Clock. i. Non-volatile memory for 60 days. j. Test output device in the form of a pulse indicator accessible from the front and capable of being monitored by suitable testing equipment. k. The meter shall record active energy and average frequency for every 15 minutes time block and reactive energy lagging and reactive energy leading and average voltage for every 15 minutes time block. ix. Transformers/transducers required for their functioning shall be in-built in the meters. Necessary isolation and / or suppression shall also be built-in, for protecting the meters from surges and voltage spikes that occur in the VT and CT circuits of extra high voltage switchyards. The active energy (Wh) measurement shall be carried out on 3phase, 4-wire principle, with an accuracy specified in the regulation. The meter shall compute the net active energy (Wh) sent out from the bus bars during each successive 15-minutes block, and store it in its memory along with plus/minus sign. It shall also display on demand the net energy sent out during the previous 15-minutes block, with a minus sign if there is a net energy receipt. Further, the meter shall continuously integrate and display on demand the net cumulative active energy sent out from the substation bus bars upto that time. The cumulative energy reading at each midnight shall be stored in the meters memory. The register shall move backwards when active power flows back to bus bars. There shall be separate register for export and import. The meter shall count the number of cycles in VT output during each successive 15-minutes block, and divide the same by 900 216

x.

xi.

xii.

to arrive at the average frequency (truncated to second place of decimal). This shall be stored in the meter's memory. The average frequency of the previous 15-minutes block shall also be displayed, on demand in hertz. xiii. The meter shall continuously compute the average of the Root Mean Square (RMS) values of the three line-to-neutral VT secondary voltage as a percentage of 63.51 V, and display the same on demand. The meter shall also compute the reactive power (VAR) on 3phase, 4-wire principle, within the accuracy and integrate the reactive energy (VARh) into a set of six (6) separate registers, using two registers (one each for VARh (imports) and VARh (exports) for each of the following ranges of voltage measurements: a. The average RMS voltage is 85% or below. b. The average RMS voltage is between 85% to 97% c. The average RMS voltage is 103% or above. xv. The current reactive power (VAR) (with a minus sign if VAR's are flowing back to the sub-station bus), and cumulative readings of each of the reactive energy (VARh) registers shall be displayed on demand. The readings of all the registers at each midnight shall also be stored in the meter's memory. Each meter shall have a test output device (visual) for checking the accuracy of active energy (Wh) measurement. The preferred pulsing rate is twenty (20) per Wh and four (4) for 1A and 5A CT respectively. It shall be possible to couple this device to suitable testing equipment also. The three line-to-neutral voltages shall be continuously monitored and in case any of these falls below about 70%, a normally flashing lamp provided on meter's front shall become steady. It shall go off all three voltages fall below 70%. An alarm shall also be provided in the control room. The time blocks in which such a voltage failure occurs / persist shall also be recorded in the meter's memory. The lamp shall automatically resume flashing when all VT secondary voltages are healthy again. The six (6) VARh registers specified above shall remain stay-put while VT supply is unhealthy. The accuracy of the meter shall not be affected by harmonics circulating in the system of magnitudes within permissible limits stipulated by CEA Grid Standards and Regulations. The meter shall indicate and record the total resultant quantities of

xiv.

xvi.

xvii.

xviii.

217

fundamental frequency and harmonics or alternatively the meter shall record fundamental frequency quantities and harmonics related quantities (such as MWh, MVAh and MVARh) separately. xix. The meters shall normally operate with the power drawn from the VT secondary circuits. The total burden imposed by a meter for measurement and operation shall not exceed 10 VA on any of the phases. An automatic back up or continue operation of the meter's calendar-clock, and for retaining all data in its memory, shall be provided through a long-life battery, which shall be capable of supplying the required power for at least two years. The meters shall be supplied duly fitted with the batteries, which shall not require to be changed for at least 10 years, as long as total VT supply interruption does not exceed two years. The meters shall not require any separate auxiliary supply for their operation. All displays may disappear on loss of VT supply. Each meter shall have a built-in calendar and clock, having an accuracy of one minute per year or better. The calendar and clock shall be correctly set at the manufacturer's works. The date (day-month-year) and time (hour-min-sec) shall be displayed on the meter front (when VT supply has been connected), on demand. Only limited clock adjustment shall be possible at site, using the Data Collection Device (DCD). When an advance or retard command is given, six subsequent time blocks shall be contracted or elongated by ten seconds each. The meter shall not accept another clock correction command for seven days. All clock corrections shall be registered in the meter's memory and suitably shown on print out of collected data. Each meter shall have a unique identification code, which shall be marked permanently on its front, as well as in its memory. Each meter shall have at least one nine (9) - character, ninesegment electronic display, for indication of the various parameters (one at a time), on demand. A touch key or push button shall be provide on the meter front or switching on the display and or changing from one indication to the next. The display shall switch off automatically about one minute after the last operation of touch key/push button. When the display is switched on, the parameter last displayed shall be displayed again, duly updated. Each meter shall have a non-volatile memory in which the following shall be automatically stored:

xx.

xxi. xxii.

xxiii.

xxiv.

Average frequency for each successive 15-minute block, up to second decimal places.

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Net active energy transmittal during each successive 15minute block, up to second decimal with plus/minus sign. Cumulative active energy transmittal at each midnight, in six digits including one decimal place. Cumulative reading of each of the six (6) VARh registers, at each midnight in six digits including one decimal place. Date and time blocks of failure of VT supply on any phase, as a star (*) mark

xxv.

The meters shall store all the above listed data in their memories for a period of forty five (45) days. The data older than forty five (45) days shall get erased automatically. Each meter shall have an optical port on its front or tapping all data stored in its memory. Portable or hand held data collection devices shall also be separately provided or this purpose, one for each substation, to serve as the interface between the meters specified above and the local personal computers (PC). The overall intention is to tap the data stored in the meter's memories once a week, and transmit the same to a remote central computer using communication links, through the local PC. It shall also be possible to obtain a print out (hard copy) of all data collected from the meters, using the local PC. The whole system shall be such as to provide a print out (both from the local PC, and from remote central computer) in an easily understandable/self-explanatory format. The meters shall be supplied housed in compact and sturdy, metallic or molded cases of non-rusting construction and / or finish. The cases shall be designed for simple mounting on a plane, vertical surface such as a control/relay panel front. All terminals or CT and VT connections shall be arranged in a row along the meter's lower side. Terminals shall have a suitable construction with barriers and cover, to provide a secure and safe connection of CTs and VTs through stranded copper conductors of 2.5 Sq. mm size. All meters of the same model shall be totally identical in all respects except for their unique identification codes. They shall also be totally sealed and tamper proof, with no possibility of any adjustment at site, except for clock correction. The meters shall safely withstand the usual fluctuations arising during faults etc. In particular, VTs secondary voltage 115% of rated, applied continuously and 190% of rated, for 3 seconds, and CT secondary current 150% of rated, applied continuously 219

xxvi.

xxvii.

xxviii.

xxix.

xxx.

and 30 times of rated applied for 0.5 seconds shall not cause any damage to or palpation of the meters. xxxi. The meters shall also withstand without any damage for maloperation reasonable mechanical shocks, earthquake forces, ambient temperature variations from -20 C to 55 C, relative humidity etc They shall have an IP-51 category dust-tight construction, and shall be capable of satisfactory operation in an indoor, non-air conditioned installation. The meters shall continue to function, as specified above, in case of failure of one or two phases VT supply. In case of a complete VT supply failure, the computation of average frequency shall be done only for the period during the VT supply was available in the 15 minute block. Any time contraction or elongation or clock correction shall also be duly accounted for. The harmonics shall be filtered out while measuring Wh, VAR and VARh, and only fundamental frequency quantities shall be measured/computed. Either the meters shall have built-in facility (i.e test links in their terminals) or in-situ testing, or a separate test block shall be provided for each meter. This test block will also be used as auxiliary supply point for PT in case of failure of main PT supply. The Exporter and Importer may install meters not having some of the functions listed above or having more functions in addition to those listed depending on the tariff requirements, quantum of power and other considerations. For such deviations both parties shall enter into a written agreement. The reasons for deviations shall be mentioned in the Agreement. Copies of the agreement shall be submitted to the appropriate Regulatory Commission and the Authority. However the entities shall consider the requirements that may arise in the near future in addition to the current requirements in order to avoid early obsolescence and costly replacements Portable/hand-held data collection devices (DCD) shall be tailormade for tapping all data stored in a meter's memory, and faithfully transferring it to the local PC. Each device shall at least comprise of the following:

xxxii.

xxxiii.

xxxiv.

xxxv.

xxxvi.

A lead with optical head or coupling it to the meter; A lead or plugging it to a personal computer; An internal battery for powering the devices; A case for safely carrying it about 220

A battery charger

The total arrangement shall be such that one (1) operator can carry out the whole operation himself, in about 5 minutes per meter. xxxvii. The DCD shall have a key or starting the data tapping from the coupled meter's memory, a key to start data transfer to the PC, and a lamp, which would light up on completion of data collection, remain 'on' while the data is held in the device and would go 'off' when all data has been transferred to the PC. Data tapping operation shall not erase the data from the meter's memory, or affect the meter operation in any way. The memory of the DCD shall get automatically cleared when the data has been transferred to the PC. DCDs shall also have the necessary provision for meter clock correction and for specifying the dates from which to which, the data stored in a meter's memory is to be tapped. The Contractor shall develop the necessary software which shall enable a local IBM -Compatible PC to:

xxxviii.

accept the data from the DCD and store it in its memory. display the collected data forward/backward rolling. on PCs screen, with

print out the data collected from one or more meters, starting from a certain date and time, as per operator's instructions, transmit the collected data through and appropriate communication link to the central computer, starting from a certain date and time, as per operator's instructions, and store the collected data on a detachable storage media.

xxxix.

The above software shall further ensure that absolutely no tampering (except total erasures) of the collected metering data is possible during its handling by the PC. The software shall be suitable for a commonly available PC, and shall be supplied to owner in a compatible form to enable its easy loading into the PCs available (or to be installed by the owner/others) at the various locations.

4. Meter Test Equipment: i. The specified number of sets of complete equipment required for in-situ functional checking and testing of accuracy of meters shall be supplied to the owner along with the meter. Each set shall include secondary voltage and current injection equipment (3 phase balanced, variable power factor), precisions instruments, 221

timing device etc. that have a study construction suitable for frequent transportation. The equipment shall be easily portable, and shall generally comply with relevant IS/IEC requirement. ii. In addition to the above, test output pulse counting device, with an accurate built-in timer, shall be provided, or independent checking of energy measurement accuracy against owner's precision instruments.

5. Calibration and Testing: i. Factory Testing: Before dispatch all prerequisite tests shall be carried out at the manufacturer's works. Type tests shall be conducted on a percentage of the ordered quantity. Immediately after calibration each meter shall be sealed. The test certificate and calibration statement shall be supplied to the owner along with the meter.

ii.

Site Testing: At the time of commissioning, each meter shall be tested at site by the owner. A reference standard meter of 0.05 class shall be used for testing.

iii.

Periodic Calibration: Testing in situ and calibration shall be carried out as follows:

System power equal to/more Once in six months than 10 MW System power less than 10 MW Once in two years

All meters shall be recalibrated at site with test equipment of 0.05 class or better accuracy. In case it is not possible to recalibrate at site the same shall be recalibrated at accredited test laboratory. iv. The meter shall also be tested whenever the accuracy is suspected by exporter/importer. Similarly the meter shall also be tested whenever the energy and other quantities recorded by the meter are abnormal or inconsistent with electrically adjacent meters. Whenever there is unacceptable difference between the quantity recorded by a meter and the corresponding value monitored at

v.

222

the billing center via communication network ,the communication system and terminal equipment shall be tested and rectified. vi. Cost of testing and calibration: In respect of cases (ii), (iii) and (v) the owner (Exporter) shall bear the cost. In respect of case (iv) the party at whose instance the testing is carried out shall normally bear the cost subject to the following provision. If the test result proves the meter is faulty or erroneous, then the cost of testing shall be borne by the owner of the meter. If the meter is found accurate and functions normally during testing then the cost shall be borne by the party who has requisitioned the testing. vii. viii. All calibration results shall be recorded in the Meter Register. All testing and calibration operations shall be carried out in the presence of the representatives of the Exporter and Importer. The party conducting the calibration shall send advance notice to the other party regarding the date of testing. The seals shall be broken for testing only in the presence of both parties. The Importer and Exporter may enter into an agreement on issues not covered by the Regulations and the Grid Code. The Agreement shall be in writing and shall be consistent with the Regulations and the relevant Grid Code. Such agreement shall be got approved by the commission. Instrument Transformers shall be calibrated once at the time of commissioning. The calibration results shall be compared with the Test . Certificates issued by the manufacturers. The ratios available and adopted shall be written in the Meter Registers and on a label fastened to the meter. The Instrument Transformer shall be tested once in five years or whenever a party suspects an internal fault or degradation of accuracy due to magnetic core deterioration.

ix.

x.

The metering system must have been tested, calibrated and sealed by the licensee before connection. (The cost of such testing and calibration shall be paid by the consumer.) The metering system has to be kept under the operational control of the Licensee. The consumer shall have no other right on the check meter except taking readings. The consumer shall claim the metering system as his asset only after it is permanently removed from the system. 223

iii.

If the divergence between the quantities recorded by the main meter and check meter is more than 2% the readings of the check meter shall not be adopted for billing whenever the main meter fails. However, if both the Licensee and the consumer agree to adopt the check meter system readings for billing with or without correction, the settlement may be done based on the check meter readings even though there is divergence.

3. Additional Meters : In addition to any metering system which may be placed for recording the electricity consumed by the consumer , the licensee may connect such metering system, maximum demand indicator or other apparatus as he may think fit for the purposes of ascertaining or regulating either the amount of energy supplied to the consumer, or the number of hours during which the supply is given or the rate per unit of time at which energy is supplied to the consumer, or any other quantity or time connected with the supply to consumer: Provided that the metering system, indicator or apparatus shall not, in the absence of an agreement to the contrary, be placed otherwise than between the distributing mains of the licensee and any metering system: PART III: Standards for Meters for Consumer 1. Applicability: i. ii. These standards shall be applicable to all categories of consumers. The Licensees and the consumers shall also comply with the requirements of grid connectivity standards of Distribution Systems and EHT Consumers.

2. Check Meters: i. ii. The consumer may opt to install a check meter. This check meter shall be for the use of consumer. If the consumer decides to install a check meter, the following procedure shall be complied with:

The check meter system shall be purchased by the consumer. The check meter shall have same specifications as that of main meters

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The check meter system shall be tested and installed by the Distribution Licensee. If the consumer desires that check meter system to be considered as a standby meter by the licensee so that billing can be done based on the check meter readings by the licensee whenever the main metering system fails the following conditions shall apply: The metering system must have been manufactured by one of the companies approved by the Licensee.

Testing through mobile vans / mobile cubicles through secondary injections kit and phantom loading may also be carried out by Measurement Unit. Provided also, that, where the charges for the supply of energy depend wholly or partly upon the reading or indication of any such metering system, indicator or apparatus as aforesaid, the licensee shall, in the absence of an agreement to the contrary, keep the metering system, indicator or apparatus correct. 4. Agreement between Licensee and Consumer : Before releasing the supply, the Licensee shall enter into an agreement with all, categories of consumers. The agreement shall contain inter alia, the terms and conditions of supply, the precautions the consumer has to observe regarding metering system and the responsibilities of the consumer, procedure for handling theft. 5. Measuring Parameters: Parameters to be measured shall be decided by the licensee/generating company and approved by the Appropriate Regulatory Commission, depending upon the application and various categories of consumers. 6. Test Schedule: Single Phase LT meters LT three phase meters (CT operated) 20 kVA to 100 kVA Other LT metering systems EHT/HT meters Once in 5 years after installation. Once in a year to be checked since these are installed for high value consumers Once in 2 years after installation. Below 5 MVA - Once in a year 5 to 10 MVA - Once in six

225

months

above 10 MVA - Once in a quarter.

The testing schedule for HT consumers should cover the entire Metering System including CTs, PTs and Pilot wire. Detailed Ratio Testing of CT, PT and Control/Pilot The Meters for Energy accounting and Audit purpose shall be tested at the time of commissioning and subsequently at least once in three years and whenever the accuracy is suspected or whenever the readings are inconsistent with the readings of other meters e.g. check meters, standby meters. 3. Instrument Transformers: The instrument transformers to whose secondary the EAA Meters are connected shall not be inferior to be that of associated meters. It shall be ensured that the total burden connected to any instrument transformer does not exceed the rated burden of the instrument transformer. Also the instrument transformers shall be tested at the time of commissioning of the meters and thereafter every- five years. The instrument transformers shall also be tested whenever the accuracy is suspected. After normal life expectancy elapses the Instrument transformers shall be tested for accuracy on yearly basis. 4. Sampling of Data: Where it is too expensive or impractical to connect EAA meters at every point the EEA meters shall be connected at sample locations and the complete data is obtained by calculation or by sound statistical extrapolation. PART IV: Standards for Meters for Energy Accounting and Audit A part of the electrical energy sent out at generating stations is dissipated in the transmission and distribution systems and the balance is supplied to the consumers for utilization. Meters for Energy Accounting and Audit (EAA) provides data comprising total energy generated, total energy supplied to consumers, total energy losses and break-up of losses in various elements of the transmission and distribution systems and the energy utilized in the auxiliaries of generating stations and sub-stations. The data from Energy audit is utilized for evolving improvements in power systems and power system configurations for minimizing the losses. Loss reduction is very important for reducing the cost of electricity and for conserving National resources such as coal, oil and gas.

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i.

ii.

The entity installing the meters shall prepare detailed specifications regarding the case, terminal block, test terminal block, connection diagram, fixing arrangements, terminal cover, terminal screws, sealing arrangements and vibration withstand capacity. The entities which install EAA Meters may stipulate additional standards, and specifications if any required.

2. Testing of Meters: Routine tests shall be carried out on each meter by the manufacturer and type tests shall be conducted on random samples from each batch.

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