Market Power

Automobile | Food and AGRO | Roads | Metals | Power

India At A Glance

Total estimated investment opportunity of US $200 bn. by 2012

Size

India has the fifth largest electricity generation capacity in the world.
Coal Fired plants constitute 57% of the installed generation capacity, followed by 25% from Hydro power, 10% gas based, 3% from nuclear energy and 5% from renewable sources.

Structure

As of now the Public Sector plays a major role in the power generation, transmission and distribution.
The participation of the Private Sector is increasing rapidly in the power generation and distribution.

Policy

100% FDI permitted in Generation, Transmission & Distribution - the Government is keen to draw private investment into the sector.
Incentives: Income Tax holiday for a block of 10 years in the first 15 years of operation; waiver of capital goods import duties on mega power projects(above 1000 MW generation capacity).

Outlook & Potential

Over 90000 MW of new generation capacity is required in the next seven years.
- A corresponding investment is required in transmission and distribution networks.
Power costs need to be reduced from the current high of 8-10 cents/unit by a combination of lower AT&C losses, increased generation efficiencies and added low cost generating capacity.
Large demand-supply gap: All India average energy shortfall of 7% and peak demand shortfall of 12%.
The implementation of key reform is likely to foster growth in all segments:
- unbundling of vertically integrated SEBs.
- "Open access" to transmission and distribution network.
- distribution circles to be privatized.
- Traffic reforms by regulatory authorities.
Opportunities in generation for :
- Coal based plants at pithead or coastal locations(imported coal)
- Natural gas/ CNG based turbines at load centres or near gas terminals.
- Hydro power potential of 150,000 MW is untapped as assessed by the government of India.
- Renovation, modernization, up-rating and life extension of old thermal and hydro power plants.