dna conversations: power tariffs need revision
One reason is the soaring cost of coal and gas inputs.
The second reason is that industry has begun to find that solar energy is cheaper than the price they pay for industrial and commercial electricity, so it can reduce their spending from the grid.
This will allow the state government to subsidize cheap electricity under the agricultural and poverty line with less money (BPL)families.
The third reason is that neither the consumer nor the national distribution company pays the bill, which may adversely affect the power producers.
Then there is the problem of loss and theft.
Something needs to be done.
Raising tariffs is a short-term solution.
In order to discuss this issue, DNA convened a group (
In alphabetical order)G. J.
Deshpande, regional executive director, Western Region-
Headquarters of National Thermal Power company; O. P.
Best General Manager Gupta
Power supply and transportation in Brihanmumbai];
Ajoy Mehta, general manager of Maharashtra distribution company; S.
Padmanabhan, executive director, operations, Tata Power;
Hosted by R of DNAN.
With the editorial support of Karishma Goenka, Bhaskar discussed the options for the future in the group.
Here is an edit excerpt: Padmanabhan: there is a need to raise tariffs across the country.
Almost all state-owned distribution companies have accumulated Regulatory assets, which is necessary.
There are many reasons why we are at this stage.
First, tariffs in all states are not stable and are increasing regularly every year.
Second, fuel prices have fluctuated dramatically over the past two years.
Oil and coal prices have been unprecedented for three years.
DNA: it\'s gas now.
Padmanaban: Come on now.
The third aspect, then, is that the cost of capital has been rising,
The interest rate is between 10% and 12%.
So the combination of all this creates a situation where many companies want to raise tariffs because once they go up, power generation companies become more viable and can guide the industry as a whole.
So I think the tariff must be raised.
This is reflected in the past 12 months. -
Tariffs have been raised in more than 10 states.
A state like Tamil Nadu has increased it by 35% to 40% because it has not increased for a long time.
This has happened all over the country, but not enough, because many state-owned distribution companies still have huge regulatory assets if you see it.
Even companies like Tata electric, we have Rs in Delhi.
Regulatory assets Rs 4,700.
So this is not a small number.
If you only consider interest rates, Rs 470 a year.
In the end, all this will bring to consumers.
In Mumbai, we have the regulatory assets of Rs. 3,000 crore.
DNA: even at MumbaiPadmanabhan: given the size and volume that they\'re dealing with, I\'m sure the State Electricity Commission is concerned about it.
So I think the tariff will increase.
There is also a need.
Otherwise, the power generation industry will be widely affected.
From the point of view of the generator ,[in spite of]
Our season regulates tariffs by regulation and other things, and what is happening is that many things force us to increase the price of supply.
Our tariffs are automatically raised.
Since 2009, for example, the FSA (
Fuel supply agreement).
Domestic coal will account for 65% of the total.
Therefore, we are increasingly dependent on imported coal.
As a result, the countervailing duty fell from 5% to 1% in the previous EU budget.
However, on January 30, the customs department issued a notice again to impose a 10% tariff on [
The customs department began to impose a 11% import tax, compared with a 1% import tax earlier. Editor]. .
So my coal cost has gone up from saying Rs. 6,000 to Rs. 6,600.
It will take effect from April 2012.
We have already discussed this with the Ministry of Electricity, and the ministry has also discussed this with the Ministry of Finance.
So this is a problem.
Another problem that damages the generator is the logistics of railway transportation.
Almost all of our power stations are in the east of the country, and unfortunately all of our imported coal is coming to us through the western ports.
For various reasons, the railway could not bring us coal through \"Vizag [\"]Vishakhapatnam]port.
But there are new ports on the East Coast and a lot of spare capacity.
But we are still importing coal from western ports.
Earlier, we imported it through Mundra.
For Korba factory in MP, we paid Rs.
1,800 per ton [
We then raised the issue with the department and later, they agreed to let US import it through Dahej.
The freight dropped to RS. 800-
900 to the same factory.
Therefore, we reduced the freight. 1,000 a tonne.
But we advocate allowing us to go through the Vizag route, which could reduce the cost of the railway and make it near the Rs. 100.
In fact, the East Coast is reasonable because our coal boats are from Indonesia.
But the railway company still did not agree.
However, we were allowed to import from Dahej after many persuasion.
Therefore, this side has an impact on us. In the end, if the cost increases, my interest rate will rise.
In addition, some cheaper power stations that can help [
Reduce collection cost
No reservation yet.
In order to reduce the cost, we have developed new specifications for the power plant, and we have added the condition that the design of the boiler should accommodate 30% of mixed coal instead of 10% or 15%.
But in the final budget ,[
The service tax has increased by nearly three.
8% our port handling fee.
As a result, this development increases fuel costs and, ultimately, there will be a regression due to rising power costs.
Last year, we made nearly 10% concessions at the coal station.
Power plants are also cheaper in many cases.
Mehta: When you start to impose electricity tariffs, you must first realize that you are in a state of monopoly.
Only one supplier.
So tariffs cannot be determined by competition.
This must be determined by the political philosophy of the government in power. DNA: True.
Mehta: this is the case with all utilities.
Their tariffs must be determined by the political philosophy supported by those in power.
Every law comes from a certain philosophy.
Now that you have an independent regulator, but in any case, the regulator cannot go against or deviate from the idea of government support.
Governments have traditionally used two means to achieve so-called social equality.
One is a tax tool, or-
The second is to control or graded tariffs in items with a monopoly, basic service or supply shortage.
It has been there in history.
Therefore, whenever an item is in short supply, a monopoly or an essential service, the government and its political philosophy will inevitably control tariffs.
Then you have to decide if it is necessary to change philosophy.
If you want to change philosophy, you can
Look at the whole thing. DNA: Right.
Mehta: in order to achieve these purposes, a large part of the flow of tax funds.
Second, the philosophy of taxation is that, regardless of the shortage of supply, Please tax so that the price signal can indicate the consumption pattern. DNA: Yes.
It will therefore reduce its demand.
So price is the mechanism to control consumption.
So you sent a price signal, \"Well, I\'ll make this thing expensive.
Please, please be careful to use even if you are poor, as this is something in short supply.
Now, fundamentally, whether it\'s electricity or whatever, the government has followed that in terms of taxes.
For electricity, the government\'s philosophy is to help two types.
One, poor people, so you have 0 to 50 units, BPL [
Below the poverty linefamily.
If you have a BPL card, you can get power almost at Re. 1 or so.
Bare living consumption should be a unit of the day.
So you spend 30 units per month, you have to pay rupees.
30 you can get your power as my cost of power supply today is RS, so get high subsidy. 5.
You just have to pay Re. 1 or so.
This is a category of government subsidies.
The government subsidizes the second band in the same category through the cross-subsidy mechanism
Subsidies include people who spend between 30 and 100 units.
Again, it\'s a fan at home, a light and a small device, a blender, a grinder, or something like a small TV.
So again we offer him cheaper electricity bills.
The second category being crossed
Subsidies are agriculture.
Due to food shortages, we suffered in our 70 s;
We beg from the United States, \"give us food \".
Wheat below PL 480
The United States allows free exports of wheat to India, but the quality is poor].
One thing we won\'t do is beg for food.
What we need to do to get food to agriculture.
One of the most important inputs to agriculture is electricity, as well as fertilizers, pesticides and training.
So power is an important input.
Food security is essential.
We can\'t beg for food everywhere, so we need to subsidize electricity for agriculture.
Now, do you say there should be a shift in this philosophy? This is the first question.
If you say that the poor may no longer be subsidized, or we want to say that agriculture is no longer subsidized, then if you change your philosophy, we can discuss policies in accordance with that philosophy.
DNA: you can subsidize, but you have to re-subsidize
Look at the electricity bill because it\'s out of control.
You are not getting the proper subsidy. Subsidise, yes.
But hometas: First of all, I will discuss a bigger issue, and then I will discuss what the law says.
There are two ways to subsidize.
One is that you subsidize the goods themselves and India does it.
We sold levy sugar in Rs.
Selling one catty in the rations store, we allow the sale of sugar for free in rupees.
There are 50 in the open market.
We sell cooking oil for a minimum of rupees. 15 to Rs.
Buy a kilo at the ration shop, and then we sell the cooking oil with the market, maybe the rupee.
100 or 200, let the market decide.
A basic requirement for human survival is food, and we have followed a cross-cutting policysubsidies.
So what\'s happening is that the industry itself
Subsidies, so the government began to impose a sugar tax and then loaded it onto sugar sold on the open market.
Thus, subsidies are mobile within the commodity itself.
Now, this application is very extensive in the field of electricity.
This means of subsidizing goods has largely leveraged.
The question now is whether we should continue to use this tool. Coming to the [Electricity]
Act, all tariffs should be within plus or minus 20% of your supply costs.
It\'s not a real act, let me correct myself, it\'s a national tariff policy.
The tariff policy states that all your tariffs should be plus or minus 20% of your supply costs.
Now my supply cost is RS. 5. 56.
So add 20%, about Rs.
7 is the maximum and the minimum is about negative 150 so it should be purchased around Rs. 4.
But where am I today, I sell farm electricity in Rs. 1. DNA: Is Re.
Lowest: this is the lowest.
Mehta: That\'s the power of agriculture.
The most expensive electricity I sell is the hoardings of Rs.
Or, if you go to a mall, multiple malls, or even in an office like this, you have to pay an average of about 10 RS. .
But your salary should not be lower than the rupee. 4.
According to the national tariff policy 50.
Now how fast do you want to get into the national tariff policy or do you want to throw away the national tariff policy and say \"no I need a new tariff policy\" is the problem
DNA: What do you think of padmanabhan: I don\'t think he is saying that there should be no tariff increase, he is talking about the situation in this country. . .
How do you solve all these problems first, then the number of tariff increases. I would also like to take some time to address other factors that put us in this situation.
DNA: please continue.
Padmanabhan: We talked about regulatory assets and we talked about different shell pricing, social equity, fuel, etc.
There are other factors contributing to this situation.
Another factor is the imbalance or lack of a good grid that can absorb electricity and distribute it free of charge.
This also caused some \"distortion\"
There is power generation capacity in the east, and the load center is in the west and north, with a wide range.
Therefore, despite the electricity, it is capable;
It cannot be supplied to the whole country.
This is a big problem.
As a country, we must solve this problem.
Of course, we have a central grid that is doing this, but not fast enough.
Your highway should be there before the traffic comes.
The transportation is convenient today, but the highway is not there.
There is demand.
Another factor is our coal supplier, a large entity across India.
The current operating scale of the company is 470 tons, 0. 48 billion tonsa year].
It is growing very, very slowly, but demand is growing much faster.
So I think it is necessary to really study a method of privatization.
Ways to improve efficiency across India because otherwise we have to rely on imported gas, coal and oil.
India already has 300 billion tons to choose from, and we now demand only 600 tons and 0. 7 billion tons per year.
But this demand may grow faster.
So we have the opportunity to take advantage of this huge investment.
India can implement it in its own way. I don\'t mean to introduce these companies tomorrow and privatize everything.
However, the situation of inefficiency is very serious, so the cost of coal is rising and fully subsidized, so today, even G-grade coal will be Rs-grade. 3,500, Rs. 3,400 [a tonne].
So I think this is another aspect after transmitting the grid.
These problems need to be solved, and some of the problems raised here need to be solved.
Deshpande: add that the southern grid is not connected yet.
Once connected, just like my Jhajjar Power Plant in Haryana, the transfer will be easier.
Today, Southern states buy this power at a very high cost. 8 or Rs. 8. 50.
In addition to this, about Indian coal, when this kind of UHV [
Unit calorific value grade of coal]
Last year there was a GCV grade change and we decided at NTPC that whatever coal we got at the time would be purchased on a GCV basis and we found the difference to be 75%.
DNA: GCV meanDeshpande: What is the total calorific value?
And UHV, unit calorific value.
As a result, they have grown from six categories to 17.
But the problem is that neither infrastructure, sampling nor quality inspection in India exists in proper form.
However, no matter what coal is charged by India, if it is charged at level 17 or any correct level, our cost of electricity will be reduced by at least 25%.
This means that electricity costs will also fall if coal costs fall.
I say again from the generator\'s point of view.
Therefore, if the cost is reduced, the impact on discoms will certainly be minimized.
My first point is that electricity is a basic commodity.
This political philosophy determines its pricing. But the [
Behavior of electricity
2003 this has changed and political control over electricity prices has been reduced.
Now, why is this price going up for an ordinary person?
Please look at the material I submitted, especially regarding Mumbai, if we want to price for the lowest public use of individuals then I think the price will be affordable and manageable
If you say, look at the basic price or power we now buy from 800 or 900 MW of total power, which is our peak load, the electricity used by the general public is about 400 to 500 MW, and the cost is quite cheap.
If you want to price the electricity in Mumbai, everyone can afford it with this electricity purchase cost.
The problem comes when we use electricity more, and because of the market shortage, you end up buying expensive electricity for higher use.
Tata is here, and their unit 6 sometimes generates electricity in Rs. 12 a unit.
Now, in order to meet the peak load demand, we have to buy this power, and the price will also be distributed across the spectrum. DNA: Yes.
Gupta: There can be more flexibility in pricing today.
Singapore is a good example.
They have something called demand response, in which case people at the high end of the spectrum end up paying more for certain usage times.
At some point in the day, the concept has arrived, but regulators still haven\'t fully incorporated it into our setup.
So, now that we\'re in a situation where we\'re in a shortage, even if the shortage has had an impact now, you end up buying expensive power at this level during the rush hour, you then assign this tariff, which is also equivalent to a cross subsidy.
People who use electricity for commercial purposes do not actually pay from their own pockets.
The cost of electricity is always transferred to the person who bought these products ---
Shopping malls or multiple shopping malls
So I personally don\'t think it is necessary to lower the electricity bill for the mall or for the multiplexing and load it into the hands of the average residential user.
Today, in most cases, the current tariffs on electricity generation are affordable electricity for the general public.
DNA: if we assume that political philosophy is not abandoned, not abandoned, there are two factors.
First, the efficiency is low, and the second is the inevitable increase in investment costs.
These two questions force us to ask a question: does the electricity tariff need to be readjusted?
Let\'s keep the gift you gave us.
The answer given is that everyday philosophy will not change.
So there is no change in political philosophy.
The poor need subsidies and agriculture.
Then I take you to the next question where philosophy really doesn\'t tell you-it\'s now in the realm of political expediency-the extent to which you want to subsidize.
Political philosophy says yes, subsidies, I think everyone in India will agree, yes, agriculture needs subsidies.
Poor people need it, but it depends on how much you value the political lobby.
DNA: Yes, unless you follow the policy.
This policy is very specific.
Mehta: 20 Plus 20 minus.
Now we have a very important issue to discuss. -
This year, we learned the lesson in Maharashtra, where we are facing severe drought.
We are not short of food.
This is the first time we have suffered a very serious drought.
Food shortage in 71 years.
We are hungry.
But this time it\'s not about hunger.
The problem is drinking water.
So now, if agriculture wants subsidies, yes, subsidies.
But subsidize it in a way that saves water.
So now you need to see how much subsidies I give, who I give, and how I offer them. DNA: Yes.
So now the water is the center of the stage.
The problem now is not electricity, but water.
Our subsidized food
But the question is: How much do I subsidize, if you ask me who I subsidize, I want to subsidize people who use water efficiently, how do I issue subsidies. DNA: of course.
Mehta: So if you say that I will plant so much in that liter of water, or I will create so much agricultural value, you should be the first person to get it, then I have to have a testimonial and subsidize the crop accordingly.
If you are inefficient in agriculture, you will be the last person to receive a subsidy.
DNA: in other words, you would recommend a policy implemented in Gujarat a few years ago and you wouldn\'t be connected if you didn\'t have drip irrigation.
You want to make sure you control agriculture through various policies.
Is this the way to be here today? Mehta: further, of course.
The way you subsidize is that no matter how much money he spends to improve efficiency, the return period is very short.
So if I drop [
And then I said, well, you put the Didi system in, I give you strength at this rate, so that your Didi will be rewarded in the next three years, anyway, four or five years, you will define a return period.
Usually, the return period of Didi should be about 10 years.
Okay, I will subsidize you in one way. -
No subsidies for Didi, subsidies for electricity.
In this way, his dripping water will pay off.
So you don\'t need to subsidize Didi, then you give the power subsidy, and then you give him the Labor subsidy.
Only through electricity can I use subsidies as a tool. DNA: Yes.
So after three or ten years, he resumed his drip irrigation. DNA: Okay.
The next question is: how to provide subsidies.
What\'s happening today in terms of providing subsidies is that you get a bill, a subsidy.
So everyone has a similar bill that says, this is the cost of electricity, this is the subsidy, you pay so much; and that’s it.
My feeling is that now that you have UID, send a subsidy directly and give him a coupon.
In this way, I subsidized 200 units.
You booked a 200 coupon.
DNA: direct transfer of interest.
Mehta: direct interest transfer, within what you think is right.
This is an example that I often give.
I am an MBA in the UK because I am with my family and they used to give us so-called heating coupons because I am a student so I can\'t afford to warm my child up.
So I can get my heating ticket.
So in my electricity bill all I need to do is bind the heating coupon and the bill is deducted. DNA: Yes.
Mehta: if my electricity bill is £ 1 a month, they gave me the value of a coupon for heating around a kilo, and I ordered my electricity bill to be 9 pounds as a student.
Therefore, we are confident that we will give you 1 pound of electricity in order to keep you and your children warm.
Rest is your pleasure and your wealth.
DNA: So you either pass the coupon or transfer the cash directly to the bank account.
Because once you print the coupon you will have someone making the fake coupon.
Mehta: those days when you don\'t have UIDs, now you have a UID or an electronic system to transfer the subsidy and transfer it directly.
This is what I want to subsidize.
You call what you want to do with it and you pay for the rest.
Padmanabhan: I understand what you\'re talking about and I want to link it to efficiency.
For example, if my Bill is rupee.
I spent £ 100 in 50 units in Rs. 2 every day.
If I pay within 30 days or at any time, you will give me Rs.
Padmanabhan: this is an example;
I mean, I\'m also responding to a system where I don\'t have an abuse of the system.
You gave me the subsidy and I am replying to the system.
But another big problem facing the industry is the huge collection problem.
DNA: Collection issuePadmanabhan: I don\'t have this mechanism even if you are willing to pay, or you don\'t actually collect money.
Now, how do you fix this-because it also has to do with tariffs, because in the end if I can\'t charge 50% I will generate interest on late payments, I will pass it on to the customer.
It goes back to the tariff again.
Therefore, you connect subsidies with operational efficiency, collection efficiency, or better productivity in different industries, such as dripping water.
Or you create a system that encourages factory shift work when the load is low.
This will allow you to move your [
To solve this expensive peak power, set the load to a unified mode.
So you need to work out a better allocation rate. DNA: Correct.
Padmanabhan: you introduce subsidies from an efficiency perspective.
DNA: so time of day is a very good way so you can predict load factors in advance.
Padmanabhan: Yes, in fact, in Mumbai, when you say the best 900 MW, Tata Power is 900 MW, while the other 900 MW, 2,700 MW utilization.
When you need more 10%, there are two or three hours, and 10% is the main cost of raising tariffs.
DNA: of course, because the factory was only put into production during that period, it must recover the full financing cost within the two hours of operation.
That\'s why the cost of base and peak loads has changed so much.
Padmanabhan: That\'s right.
So if we can scrape it off and say one should pay 30% more during peak loads, you\'ll see things coming back again.
Your punishment is inefficient and you reward efficiency.
So that your subsidy system can also work.
Deshpande: I agree with the point of view on the day of the tariff and the time of direct interest transfer.
The only thing we have to see is how to implement it so that the right people get the right subsidies and any advantage they should get.
In fact, this has been recommended by one or two committees, and the concept of electricity during peak hours has begun.
Basically, their target is gas power stations, which usually last for a very short period of time, and so during peak hours.
The discussion is also in progress, and NTPC has also published a paper on what is the tentative cost of generating electricity given the life of the gas station and other things, as we have to start stopping often, so we have to record all the running times.
I think the discussion has reached a very advanced level so far and we may see the concept of at least (if not time) reaching the peak of electricity tariffsof-day tariffs.
I\'m also on a commission there, but it\'s just dealing with natural gas to generate electricity.
So, if any, because we have received information in Haryana and in many places, especially in the shopping center.
They are ready to pay any electricity bills during peak hours.
The alternative is to use DG [
The setup cost is much higher.
Mehta: So is Gurgaon.
Haryana means Gurgaon. DNA: Yes.
Deshpande: many societies are also close to us.
Okay, you give us power in Rs. 12 or Rs.
During this period.
The only problem is that we are not able to distribute power on NTPC as our power generation capacity has been allocated to different discoms.
But the Haryana region and many other regions offer offers.
So, let\'s take a look, if this peak power concept comes. DNA: Okay.
But that would mean higher tariffs.
DNA: how do you see this in Maharashtra, for example, if I am a grower of a water-deficient crop, what would you do if my tariff is higher than that of a wheat grower
We need a lot of reflection on agriculture.
I don\'t remember, but I read an article in a paper that we exported so much rice in a certain year.
But in the process of exporting rice, you also export so much water, fresh water, which is a premium today.
Now, should you export water and subsidize its sugar exports of similar kind.
Maharashtra is one of the country\'s largest sugar producers.
Now, yes, it\'s a good thing that we produce sugar.
This increases the wealth of the farmers, yes, it is good.
But in the process, you are also supplying water to various parts of the state, and you use electricity subsidies to supply water to other states. DNA: Yes.
Mehta: Now how do we look at all of this, the big question is how do you price the produce. Dna: how do you get back to the agriculture pricing Agriculture Hall and ask us--
What they say is quite right too-are you pricing the produce correctly? These are the problems before us.
So once you make the right price for the produce-not just the mechanism of the ability to pay, even if the price of other goods depends on the ability to pay.
How much does a person prepare to pay for this bottle of water? Yes, you can say, this place is completely dry. No faucet].
I can even sell a bottle of water at Rs. 100. DNA: of course.
Mehta: you won\'t even get the rupee if I have a good public tap water.
But agriculture cannot be priced at the capacity to pay.
In my opinion, agriculture must be priced based on the impact on the environment and the needs of the country.
DNA: Basically this is what a country needs.
There is an urgent need for something in this country, pricing is based on demand.
Mehta: in other words, you have to price your power.
It\'s not easy to decide how to price electricity.
DNA: is the political body willing to consider the logic that I am a bureaucrat. DNA: Okay.
There is enough data to show that agriculture is the biggest waste of water in India.
Unfortunately, when the price of electricity is the lowest, waste is the biggest, and when the agricultural electricity is free, waste the most.
How do you react to such a situation, Gupta: part of the reason is that the answer has been given by Mr GuptaMehta.
Another problem is the need for food security. -
The minimum output required to meet the needs of a country.
Now that agricultural exports are the main ones, we will have to look at what other countries have done, such as manufacturing, export-related exports-they are much more advanced than agricultural exports.
But because low tariffs on farmers allow policy makers to allow low-cost agricultural products in open markets, this becomes a distorted subsidy.
We actually subsidize the middle class in the name of farmers.
Just compare the way agricultural prices rise with any manufactured goods such as cloth, shirts, etc.
In the past 20 years, the price of manufactured goods may have risen by 20 times, while the price of agricultural products may have risen by only 100%. 10 to Rs. 20 or Rs. 25.
DNA: Did you see a problem? For example, users of high-priced electricity-industrial and commercial-are switching to captive solar instead of paying rupees. 10-Rs.
14/kWh, I can get solar energy in Rs. 6-
7, thus saving Rs. 3-8 per unit.
This will reduce the funding of distribution companies and block their ability to subsidize agriculture.
Mehta: Let\'s not fight.
Fundamentally, the question is: From today on, where are the agricultural subsidies in Maharashtra, for example, the total amount of subsidies to increase the flow of electricity into agriculture through the power sector is RS. 10,000 crore.
It could reach nearly 12,000 crore this year--
In this fiscal year.
So the electricity sector is pushing for subsidies of about Rs 10,000 last year;
It is pushing Rs this year.
Agriculture has invested 12,000.
They paid Rs 7,000 last year from industrial and commercial tariffs because they were running faster than the cost of power.
So my supply cost is RS. 5.
56, they supply power in Rs. 7, Rs. 8, Rs.
Up to Rs. 14 a unit.
So they gave me Rs 7,000 for agriculture. And the Rs.
Rs 3,000 is a direct government subsidy, because whatever the regulatory arrangements, the government will give a subsidy above this, so the rupee.
Rs 3,000 from the government.
So we can give away Rs subsidies. 10,000 crore.
Now the first question is, where do you want to pin this 7,000 crore, do you want to reduce it to 1,000 crore, do you want to reduce it to zero? Or where do you want to produce 10,000 rupees and where do you want to pin itDNA: industry can\'t pay more.
Mehta: I also agree that the industry cannot pay more.
The industry must survive.
Tariffs have become increasingly onerous.
DNA: otherwise your job will be gone.
Political institutions know that jobs must be created.
Mehta: So what you\'re suggesting right now is that 7,000 crore should not know who created this business opportunity, it\'s not your innovation creation, it\'s not because the government decided to give subsidies.
Mehta: What solar Hall is saying now is that there is a business opportunity.
I must get the Rs. 7,000 crore.
What do you want to do now? I put a solar panel.
You\'re right. 6.
And the strength he gained in Rs. 8 or Rs.
Now he will replace Rs.
He will get it at Rs. 6.
But why the industry got it in Rs.
I could have given it to him at Rs. 5.
So, fundamentally, solar energy is not achieved through technological breakthroughs or great innovative thinking.
It\'s just that you\'re trying to seize the existing business opportunities and try to get into the business opportunities created by the government.
DNA: in other words, solar energy is struggling with the government\'s irrational pricing: I will not say irrational.
Government pricing based on the philosophy of government recognition.
Maybe it\'s right, maybe it\'s wrong.
You can say no tomorrow.
Why should the government take agriculture as a political philosophy.
You can\'t say that political philosophy is irrational.
Finally, political philosophy has come through a process or through democratic elections. DNA: Okay.
Mehta: No political philosophy can be said to be irrational.
Only the elected people can decide this issue.
So, yes, you can say it\'s an unreasonable policy under dictatorship.
But in a democratic country, no, you may not like different policies, but you can\'t call them irrational.
So when solar people come to me and say, sir, we want to have solar panels installed in multiplexing, in malls and in offices like this. I said, no.
Please put it on the roof of the BPL family.
You are no longer viable because he buys electricity in Rs.
Your solar energy will be Rs. 6.
You buy electricity in Rs. 10 and at Rs.
This is feasible for you.
So when it comes to solar, you can tell me that it\'s the power or energy of the future, and that\'s fine.
But it\'s cheaper if you want to tell me.
It\'s just trying to get into the business opportunities created by the government.
What we have to do now is-
Through the back door--
Trying to overthrow the government.
The government says well, I have to give the agricultural power of Rs.
I have to give it to industry in Rs. 8.
So the backdoor way to break this political balance is to provide solar energy in Rs. 6. DNA: Okay.
Mehta: in the name of solar, you are trying to dismantle the existing arrangements.
Please bring solar energy in if you want it.
But put it into the whole energy basket and then we will distribute it the way it should be allocated.
You know, don\'t open a door for someone to run away.
So what you want to do in solar today.
DNA: So it\'s up to the grid that you want to sell solar energy to the grid. Mehta: Yes.
You put it in the basket and decide how big your basket should be.
Then distribute tariffs to people the way you want to distribute them.
This is all back.
DNA: So in order, you\'re saying no to the power of the captive. Mehta: Exactly. No.
If you want to be a captive, the social good is what you care most about, please put it in the BPL family and then let\'s see how it survives.
DNA: any comment.
Padmanabhan: look today if you take out the electricity generated by DGs, it\'s about Rs. 14, Rs. 15 per unit.
This is the best you can get in Rs.
15,000 oil per ton.
Solar and wind energy technologies are alternatives to such high-cost coal. That’s one way.
I\'m totally clear that you have to put it into the grid.
See if you want the overall balance and you have to go through the grid.
In this way, you can average the cost of electricity.
Today the solar energy is less than 2% of the basket.
In the context of today, this is a very small thing.
But, no matter where the grid is, go to the grid and let the grid decide the price.
I totally agree with you.
But there are also areas in India when the grid is not available. DNA: Clusters.
Because the cost of the grid is not cheap, it is RS. 2-2.
RS 5 A Kilometer
The cost of the line plus the 110 kV line plus the tower is such a price.
Can you look at the possible solutions for solar energy as a location not available for the grid
The grid is welcome and should be encouraged.
DNA: the existing rules do provide decentralized power for remote clusters.
Mehta: You know, it has a lot of economic significance, not carrying a line and maintaining it just for the sake of two families. DNA: Yes.
But it was ignored.
Gupta: So those areas where local authorities can be set up can have access to the distribution rights of that particular area. Mehta: Perfect. Perfect.
Gupta: where do you put the solar energy and then distribute and consume it only there.
Deshpande: The law provides for this.
Padmanabhan: it makes a lot of sense. Rs. 1-1.
Because we did not install the power grid, we received a subsidy from the transmission company.
DNA: Also, you can take advantage of other subsidies in remote areas that you offer and you can pay for the Decentralized settings.
So this is another way to look at the Sun. DNA: Yes.
Padmanaban: But I agree with him, you know, if you use them as industrial energy in captivity, what you actually do is not right.
In any case, this also creates an imbalance in overall decision-making.
Yes, it makes sense.
But with the increase in input prices, inefficiency, and the presence of distribution problems, can we get an answer to the original question? Will policymakers be forced to change the way tariffs are judged? What Padmanabhan says is the cost of regulation is unbearable.
You can\'t do this. your balance sheet is unreliable. everything is unreliable.
Padmanabhan: my numbers are very small compared to state and country numbers.
National distribution companies, their burden is more heavy.
No comparison. DNA: of course.
Gupta: competitive politics must really understand the concept.
The most recent example is the United States. P.
After a long time they revised the tariffs and I think a big commotion has started.
But in this setting, when you talk about the inside
Sector subsidies like agriculture, industry or housing, the current competitive politics usually means that the opposition party will take a completely different view if the ruling party allows a change.
DNA: No, let me put it another way, many subsidies can still be met without abuse of subsidies. Gupta: Yes.
DNA: if there is no subsidy for theft. Gupta: Yes.
DNA: in other words, the DBT answer seems to be the only reasonable answer that the state can introduce as the first metric.
You see in padmanabhan: it\'s already starting to happen in the case of consumer gas.
So the principle is there, and it\'s also being tested.
Then, do you apply it to food, or do you apply it to electricity, or do you talk about coupons in the USK.
This is an application method. DNA: of course.
Coupons are just a way.
Yes, that\'s right.
DNA: So, do you see what\'s going on in sayyymehta: Three things have to happen and that\'s going to happen.
One is-I am talking specifically to Maharashtra, and I am not talking about this country because there are different needs and different issues in every region of this country.
Let us recognize that Maharashtra is a highly industrialized country and a highly urbanised country.
Therefore, if agriculture is important, so is the urbanization and industrialisation that is taking place in the country, which is creating a lot of jobs, creating a lot of wealth and bringing a lot of prosperity. DNA: Yes.
So, you can\'t just say that it\'s bad to industrialize.
You can\'t say the mall is bad.
The mall hired the poor in the city.
Just like factories employ people in rural and arid areas, shopping malls also employ a lot of labor that is now emerging in cities, educated and wanting a better lifestyle.
They are not ready to work in your home yet, cleaning and washing clothes.
They want to get dressed, stand on the counter, have a good conversation with you and get you involved.
So this is a huge, popular, very ambitious population that is employed by these institutions that have emerged in urban areas.
Now, we can make them financially unable to survive.
But they have to stay alive in order to prevent unemployment. DNA: Yes.
Mehta: So the first thing we have to think about is how to strike a balance between agriculture and industry. DNA: Okay.
This is the first thing.
Meita: On the one hand, drought, on the other hand, urbanization rate.
Today, if I am not mistaken, the urbanization level in Maharashtra is close to 50%.
50% of the population is in urban areas.
So you can\'t say that the urban population is treated very well, and the rural population is treated very well.
You have to strike a balance somewhere.
Yes, food security is important.
But we need to strike a balance between the two, and that\'s one of them.
And then go further, and one more thing that has to happen is this great battle between me and the various consumer groups.
The real cost of power must be passed on to people.
There can\'t be two ideas about this.
The real cost of the cost must be passed on, and secondly, the real cost must be recovered.
There can be no interference with this.
Fortunately, this has been happening in Maharashtra and the real cost of electricity is being passed on.
Because let me tell you that distribution companies cannot survive if real power costs cannot be passed on.
I\'m not going to name the state, but I can actually tell you that 10 states are doing load cuts because they don\'t pass on the real cost of electricity to their people.
DNA: they realize this and look at Punjab and they are starting to charge now. Mehta: Yes.
Most states face the problem of load reduction because they never pass on the real cost of electricity to the people.
So, whether you like it or not, the real cost of electricity must be passed on and it must be restored.
Today we are free in Maharashtra as we deliver the real cost of electricity and we are collecting it as well.
Sometimes we are labeled relentless, but this is the only way out.
DNA ta: because you need to turn on a generator, that is Rs, if we don\'t give you power.
Our strength is Rs. 4, Rs.
Residential electricity 5. DNA: Yes.
So these three things must happen.
Two things you said.
The first is to coordinate the needs of urban and rural areas, and the second is the real cost of electricity.
What is the third question: the real cost of power for real recovery, the third one is the peak power problem, which is lost in noise.
Especially in Maharashtra, because today in Maharashtra, we have reached the stage of excess power.
However, there are some small time windows where we have insufficient power. DNA: OK.
Meita: a small window from 7 to 9 in the evening, a small window from 7 to 8 in the morning, we do face the problem of peak electricity consumption.
You know there are a lot of committees talking about ancillary services and they say, \"Well, we\'re going to have peak power stations that will open at that time \".
Now I have a fundamental dispute at this point.
Peak electricity is expensive.
DNA: because the plant only works for two hours but pays interest for 24 hours, it is expensive.
Mehta: Now, you have to pay for this peak power.
Whether or not it should be injected into the grid, the choice should be with the consumer. DNA: Yes.
Mehta: Now, if I am a poor consumer, if you tell me that electricity is expensive from 6 to 7, I might as well go for a morning walk from 6 to 7.
Why am I sitting at home paying for expensive powerDNA?
Mehta: so I\'ll turn everything off and go with my kids and say \"let\'s go for a walk\" and come back at 7.
Again, quote my example in the United States. K.
We did everything.
Grinding of spices for cooking]
After 10 in the evening, because the electricity is the cheapest from 10 to 12 in the evening. DNA: of course.
So the price is the decision to use the model.
Mehta: So basically what I \'ve been trying to say is, first of all, put your [Todd]time of day]
Rice in place.
Let people decide whether to use your peak power or not, and then let NTPCs and Tata generate power.
Don\'t go back and say, \"Oh!
I will let you install a peak factory, whether you like it or not, I will make sure it is tied to your neck \".
So, first put todemi in and tell me this is the tariff at this time, and I will tell my kids, guys, that there is no study at this time, and there is no six or seven, we went for a walk.
So I changed my life, it\'s a price sensitive country.
This is a price-sensitive country.
So I will change my way of life to meet your tariff needs.
DNA: So you can control agricultural consumption and domestic and industrial consumption by price.
Mehta: it\'s time for todemi.
DNA: What is NTPC? How do you see your agency working on Todd as you are a supplier of the country: in this case the Todd concept applies only to natural gas
The power station we worked.
Not for coal plants.
But coal has always been the primary energy source.
Coal is the basic energy source.
Deshpande: Coal has always been the base power, but due to its position in the capital after power grid failure, many times even coal power stations have been used for peak power.
DNA: for peakingDeshpande: For peaks only.
That is to say, the lowest power of their technology will remain unchanged, such as 500 MW, which will operate at 300 MW.
The peak in the evening will run at 500 MW.
DNA: So your PLF [
Plant Load factor.
Deshpande: after the Energy Saving Act, we launched PAT-on behalf of \"achieving trade \"---Act in 2011.
According to this, each power plant must prove that our efficiency has improved in three years.
Based on the capacity of the station and the performance of the past three years, we will be assessed.
Because at NTPC, if I work in 2014 with the same efficiency in 2011, then I will have to pay the rupee.
A fine of Rs 380.
This means that the concept of an ecosystem has arrived.
The reason I\'m talking about this is because when we talk about water, I want to say that the same principle is recommended by FICCI for water.
This means that they are also trying to apply this to the Water Conservation Act.
On the same line as PAT.
Only from 2014 can we see its effectiveness.
At the Kawas at the gandaha power plant, I paid by date. 16.
Take 50 water per cubic meter, I use a lot of water. DNA: Rs.
16 Deshpande: there are 15% upgrades per year, as is the rate of upgrades in many states-Rs. 12, Rs. 14 --
Because of the water;
Water is the main resource.
Therefore, we are also concerned about saving water.
Because water is not a pass. through item.
On the NTPC itself, we added Rs to our bill.
All stations have only 200 rupees of water.
DNA: Sorry to bother.
But according to what you say, the minimum cost of water is RS. 12 to Rs.
Per cubic meter: per cubic meter. Yes, sir.
So now that FICCI has been introduced to all stakeholders and to all industries [
Like in Gujarat. .
As they say, if you reduce your water consumption by 5% to 10%, 20% in the last three or four years, it hasn\'t been decided yet, and then you can also get a water certificate
Although this concept has not been discussed by the ministry until now, energy-saving measures such as APC reduction and heat consumption increase have been introduced. DNA: Okay.
One more thing ---
We\'re talking about solar energy. -
NTPC has put in two power plants with 5 MW each, and we have commercialized it, but we have put in a decentralized power plant and also include a biogas plant without a power grid.
At Chhattisgarh, we entered the first factory in the Rihand area, but we found that sustainability did not exist when we built a society and all of them.
So what we\'re doing now in the case of solar energy is that we\'re trying to use it to save fuel.
I use solar panels regardless of the heating cycle.
I will turn off the heating during that time.
This will reduce my coal consumption.
I will have the same power.
So now, we did our first experiment at Dadri.
So we will mainly use solar energy. DNA: Excellent.
Deshpande: except where we signed the PPAs [
Power Purchase Agreement
We are also building power plants with water and solar energy in mind.
Padmanabhan: I just want to add one more.
I am thinking about how to reduce the tariff. DNA: Good.
We are all interested.
Padmanabhan: absolutely right.
Technical and commercial losses are actually another factor that has an impact on tariffs.
So if you can reduce the loss, maybe at some point, by introducing better technology, better meter reading technology and improving the quality of the network itself, reducing the loss in different ways, mumbai and Maharashtra are lucky places.
If you look at the availability of the Indian network, there are places where the network is very, very unreliable. DNA: Yes.
So I think we can do a lot by introducing mature technology.
We don\'t need to go high-end.
We can start with the low end and implement it.
You are able to measure correctly, charge correctly and charge correctly at a lower cost, which will increase the tariff.
As a result, you are increasing the productivity of the metering, billing, collection, and recording of the program process, all of which help to reduce rates.
We all know why tariffs increase, but all we can do is find ways to reduce the impact of tariffs.
. . . . . . Gupta: using better technology and distribution-distribution networks and metering networks.
Today, as a distribution licensee, the amount spent on meter reading, billing and power generation accounts for one-
My third distribution cost
The technology is now available all over the world.
Remote reading is an example.
Today, our setup and system is a design that doesn\'t always support planning and where we distribute power.
We have been discussing this and I have already written to the company.
Just like every building has to have a proper meter room and be built as part of the building design, this is good for me to automate meter reading.
Today, if you see most of these buildings, the instrument room will be located where it is almost impossible to signal anything.
DNA: in other words, the architectural design must also be modified, gupta: then you will know the street near the building.
Now, I may only need one bandwidth if I need to read the meter remotely.
These days my meter has a range of about 50 m.
So the person I drive can pick up all the readings.
If all the buildings keep the meter close to the reading, my van can receive a signal that one person can read all the meters by driving.
This will greatly reduce the cost of meter reading and total billing costs.
Now, this is a very obvious cost reduction that you can introduce right away.
DNA: Are policymakers willing to adopt such measures?
DNA: So why don\'t we do that? There are many reasons: bureaucracy.
Authorities in multiple cities.
There is a lack of coordination efforts on various issues such as urban planning and urban planning, because I also operate traffic.
In terms of transportation, I saw the same thing, five authorities did five different things.
Now, when we talk about the architectural design system, every authority has its own ideas ---
Bmc mmrda, MHADA, Department of Urban Development--
Five departments do five different things.
Now the so-called architectural design norms and urban planning need to be unified.
I now convey to decision makers the idea that this is something to consider in terms of urban planning and urban planning.
DNA: Did the Todd concept and the concept of measurement be accepted in the state? Mehta: We have put it forward.
We decided two things.
All of our HT tables are not Todd tables.
We also tried this experiment on night duty and industry, giving Rs discounts. 2. 50.
DNA: Oh, you did it already.
Mehta: today it is one of the largest cities in the country.
So night fee-
If you operate your factory from 10 in the evening to 6 in the morning-you get a Rs. 2. 50 discount.
From day to night, this drives a lot of consumption.
If I\'m not mistaken, we\'ll introduce this from January 1. DNA: Okay.
Mehta: very successful.
The industry is very satisfied with this, especially the larger industry.
The second thing we \'ve been looking-
This is the idea we are following now in a distribution company ---
Any utility that monopolizes and deals with people, the employees of the utility should not interact with people.
Technology should be interactive. DNA: I see.
We made it very clear.
Once you have an HR interaction with your client, you will definitely have rude behavior;
You must be corrupt. DNA: Collusion. Yes.
Mehta: you must have a lot of other questions.
So we \'ve made it clear that we don\'t want our people to interact with our customers.
We want technology to interact.
We are now entering the so-called IR [infra red]
Rice in rural areas.
We started in a huge way, the IR meter, in which you just need to get into the sight of the meter. What O. P.
It was very clear and correct about where they installed the meter.
But I think if I can\'t change the wall, at least let me change myself.
So I have the IR meter, you can get into the sight of the meter, press the button and the reading will be discarded.
You don\'t need to read, write and register.
Anyone can do it.
That\'s what we do in rural areas.
In urban areas like Thane, Belapur-
We also have Pune in naswick. -
We are ready to use the RF meter.
Well, we can\'t look on the road, but if we get close to the reading room, if my guy is standing he will press a button and all the meter reading is thrown there
We see a huge difference.
No one likes a rude person to come to your house and ring the doorbell and say, \"the sea of mi Padana, the sea of kiddahar \"[
I have to read the meter. Where is it].
You don\'t need to enter the house.
You can look outside the house. DNA: Excellent.
Meita: for the industry, we put nearly 90% of the industry into AMRs, so all the readings went straight to my office in Prakashgad in Mumbai]
Go to the central control room.
We don\'t have to go there.
This is what we have done in the past year.
Therefore, we are also very active in paying attention to the industry. No more checks.
Please do not come to us to check, RTGS is the only mechanism we support. DNA: Oh!
The industry pays through RTGSMehta: RTGS.
Please don\'t come to us.
We read your meter through AMR;
We will send you an email. DNA: Hats off.
Mehta: You sent it to us via RTGS.
Please don\'t come to us.
We follow a philosophy very clearly. -
Please don\'t see us. See technology.
DNA: does NTPC push this kind of thing in StatesDeshpande: No sir, we are a generation, so the distribution part does not apply to us.
But the first thing I saw after my joining date was that Maharashtra was in power at Rs. 2 less at night
Then I read all the details.
We see that discom does not cause losses, but with the growth of industry, consumption increases, so the demand for electricity at night has also increased.
DNA: it balances the financial situation of our country.
Gupta: in fact, tariffs and metering will be a problem in this election. DNA: Yes.
The Aam Aadmi Party has actually sat there to discuss the issue.
Gupta: So this issue is going to come up, privatization, the public council for franchising. DNA: Yes.
Because it\'s a commodity no matter what you say.
DNA: but as Ajoy said, you have to tell the customer that this is the cost of electricity.
If you don\'t educate them, the problem is with us.
We cannot educate them.
Mehta: You know, that\'s why I blame the media.
Mehta: The Basics of news, you know, it\'s news that people bite dogs, but it\'s not news that dogs bite people.
So when I prove that the cost of power is not news, but when the delegates say out loud, inefficient, corrupt, it\'s news.