NDPL Performance Improvement of the Distribution Segment ... - Y S Butola - Performance... · Performance Improvement of the Distribution Segment (A Case Study of NDPL) Arup Ghosh

Performance Improvement of the Distribution Segment

(A Case Study of NDPL)

Arup Ghosh , Chief Operating OfficerNorth Delhi Power Limited

Department of Industrial and Management Engineering

Indian Institute of Technology Kanpur

3rd Capacity Building Programme for Officers of Electricity Regulatory Commissions

23 – 28 August, 2010

Forum of Regulators

2

Structure of Presentation:

• Background

• Strategic Road Map and Strategic Decisions

• Key Initiatives

• Results

• Rewards & Recognitions

• Issues / areas requiring attention of Regulators

3

Delhi Vidyut Board in the Year - 2002:

• AT & C Loss - More than 53%

• Financial Loss - Approx Rs 10 Cr / Day

• Govt. Subsidies - Approx. 1,200 Cr / Annum

• Billing Receivables - Close to 1 year outstanding

• Equipments / Network - Pathetic

• Consumer Records - Manual & incomplete

• Consumer Care - None, No focus

• Power Interruptions - Availability 16 hrs/Day

0

10

20

30

40

50

60

1983

-84

1985

-86

1987

-88

1989

-90

1991

-92

1993

-94

1995

-96

1997

-98

1999

-00

2001

-02

Percentage T&D Losses

T & D Loss Trend - Pre-privatization

4

5

Key Parameters - In Year 2002

• Billing Efficiency = 53.72

• Collection Efficiency = 97.18

• AT & C Loss Level = approx 53 %

6

Geographic Description:

NDPL

BSES Rajdhani

BSES Yamuna

NDMCMES

Joint Venture of TATA Group with Delhi Govt.51:49%

NDPL Profile:

7

As on date

Rs. 2,759 Cr (FY 0910)

1,313 MW (Jul ’10)

6,911 MU

1.21 Million

3,950

510 Sq Kms

4.8 Million

1,439 *2,372

0.57

08% / 06%

As on Jul’2002

Rs. 1,095 Cr

850 MW

5,237 MU

0.8 Million

5,400

510 Sq Kms

4.2 Million

1,246

1,568

1.03

-

Particulars

Turnover

Peak Load

Energy Requirement

Total Registered Consumers

Number of Employees

Area of Distribution

Population Serviced (approx)

Per Capita Consumption (Units)

No of Consumers / Sq km

Employees / MU input

Load / Energy Growth

* (National Average of 500, Mumbai – close to 850)

8


• Background


• Key Initiatives

• Results



Strategic Roadmap:

WHAT NDPL INHERITED – JULY 2002

AT&C Losses> 53%

No concept ofconsumer service

& IT Interface

Electricity Supply System on the

verge of collapse

Lack of Performance Orientation

STRATEGY FOR THE 1S T CONTROL PERIOD (2002 – 2007)

AT&C Losses <25%

Consumer service & IT Interface to be

comparable with World Standards

System Reliabilityto be comparable with Best Utilities in

India.

Performance Orientation through

Change Management

Ø50%

1,00,000 Backlog

Complaints

No Planned CAPEX & OPEX

in Past 3 Yrs

5,400 Staff (Unfavorable

Working Condition)

9

Strategic Decision:

• Decentralization of O & M activities / function

• Centralization of Commercial activities / Processes

• Replacement of Old Electro-mechanical Meters by New Electronic Meters

• Energy Accounting

• Intensive introduction of Technology

10

• Background


• Key Initiatives

• Results




11

• Identification of components of AT&C Losses

• Loss Reduction Strategy - Technical Solutions


• Re-engineering of Commercial Processes (BPR)

• AMR for all connections above 10 KW

• Automation Roadmap

• Technical & Process Related Initiatives

• Initiatives in association with Govt.

• Initiatives related to Society

Key Initiatives & Implementation:

12

Collection Process Deficiencies:20. Part Payment by Consumer21. Non Delivery of Bills22. Non Payment by Consumer (Defaulters)23. Premise Disconnected with Dues

Billing Process Deficiencies:14. Consumer not billed / under-billed15. Provisional Billing16. Bills pending for Quality Check (BQC)17. Bills pending for assessment18. Meters installed but not appearing in data base19. Un-metered connections:

(Unauthorized Colonies, JJ ClustersStreet Lights Poles)

Metering Process Deficiencies:7. Meter (address) not traceable8. Import / Export Metering Error 9. CT Ratio Errors

10. Stop / Slow / Defective Meter11. CT Ratio Errors12. Meters not read 13. Mismatch of Meters

Theft / Unauthorized Use:2. Direct Hooking3. Tampering / By -passing of Meter4. Misuse of Category5. Use of Multiple Connections - Misuse of Slab6. Sanctioned Load lower than actual usage

Technical Loses:1. Iron & Copper losses atSub-transmission (66kV/33kV) & Distribution (11kV & below) Network

Components of AT & C Losses:

13











14

HVDS

High Loss

High Resistance

Areas

Implemented in more than 250 areas, more

under implementation.

High Loss

Low Resistance

Areas

LT ABCApprox. 2,500 Kms of

LT ABC laid, more under implementation

MeteringInitiatives

Electronic Meters, AMR,

Pre-Paid Metering

Schemes implemented successfully, more

under implementation

Loss Reduction Strategy – Technical Solutions

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16

17

M

M

M

M

By STU

66 or 33 KV

11 KV

At Consumer Premises With HT Load

Feeder Meter

11KV/415 V DT

For Energy Accounting

At Consumer Premises

66/33/11 KV

STU to DISCOM

FEEDERS TO ZONES

Tier 1: Transmission level

M

Tier 2 : Sub transmission Level

Tier 3 : Distribution level

M

Energy Accounting – Flow Chart











18

19

CMG RRG RDGMRG RBG RCGMMG

RAG

Policy Regulatory Bench Data Revenue Infrastructure Advocacy Compliance Marking Analysis Protection Support

Consumers

Call Center

Customer Care Center

Website E mail LettersDrop boxes

SAMBANDH – Integrated Commercial Package software- Industry First!!

Business Process Re-engineering (BPR)

CCG











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Automatic Meter Reading (AMR):

METER

GSM-MODEM GSM-Network

PSTN-NetworkPSTN-MODEM

S/W

USERS

LA

N

DB

DEBS

I. METERING

II. COMMUNICATION

III. BACK OFFICE

21











22

Automation Roadmap: Journey so far …

23

• GIS - Completed

• GSAS - Completed

• Communication Network - Established and Stabilized

• SCADA - In Operation

• DMS - Under Implementation

• DA - Under Implementation

• OMS - Under Implementation











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Technical / Process Related Initiatives:

• Development of Tamper Proof Energy Meters

• Payment Avenues increased from 20 Nos. (July 2002) to more than 1500 Nos.

• Door delivery of new Electricity Connection

• SMS Based Complaint Management System

• Instant Camp Connections at JJ Clusters

25











26

Initiatives in association with Govt.:

• Constitution of Special Court

• Assistance of Police Force / CISF during Enforcement Activities

• Relocation of JJ Clusters to a new resettlement Colony (Sawda Ghevra) for providing better services

• Amnesty schemes for settlement of old disputed cases (DT / DAE etc)

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• Initiatives in association with State Govt.



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Initiatives / Programmes related to Society:

• Life Insurance Policy for Socially / Economically Backward Consumers

• Development of local people as Franchisee

• Energy Conservation and Awareness through Energy Club (more than 31,000 Students covered)

• Woman Empowerment (Vocational Training, beautician Courses etc)

• Health Check-ups, Blood Donation etc

• Adult Literacy, Drug / alcohol de-addiction, Support to Orphanages, HIV / AIDS awareness etc.

• Engagement with the Public Representatives

29

New Initiatives:

• 108 MW Combined Cycle Power Plant

• Solar PV Based Power Plant

• GPRS based spot Billing

• SAP – ISU (Billing + CRM)(Industry Specific Solution for Utilities Industry)

• Centralized Call Centre (No current + Commercial)

• Special Consumer Group

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31


• Background


• Key Initiatives

• Results



Savings to Govt. – Victory Curve

32

Loss Reduction (Trend):

33

Parameters FY 02-03 FY 03-04 FY 04-05 FY 05-06 FY 06-07 FY 07-08 FY 08-09 FY 09-10

Energy Input (MU) 5,237 5,552 5,549 5,695 5,986 6,281 6,327 6,911

Units Billed (MU) 2,813 3,196 3,667 4,154 4,351 4,975 5,225 5,816

Amt. Billed 1,126 1,272 1,565 1,883 2,032 2,323 2,468 2,722

(Rs Cr)

Amt. Collected (Rs Cr) 1,095 1,219 1,568 1,897 2,132 2,394 2,539 2,759

AT&C Loss47.79 44.86 33.79 26.52 23.72 18.38 15 .04 14.47

(%)

Billing Efficiency (%)

53.72 57.56 66.08 72.95 72.68 79.21 82.58 84.16

Collection Efficiency (%)

97.18 95.78 100.2 100.73 104.94 103.04 102.87 101.34

Augmentation of Network Capacity:

Particulars Voltage Level

Unit On Takeover- Jul 2002

2010 (As on date)

% Change

Transformation Capacity

66 kV MVA 860 1,545 80

33 kV MVA 791 1,484 88

11 kV MVA 1703 3,770 121

Total (MVA) MVA 3,354 6,799 102

Transmission Lines

66 kV KM 176 309 76

33 kV KM 156 318 103

11 kV KM 2,245 3,555 58

Total (KM) KM 2,578 4,182 62

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Results – Few other parameters

PARAMETERS / PARTICULARS BEFORE TAKEOVER

AT PRESENT

OPERATIONAL:

Capital Investment (Rs Crores) 1,210(Valuation)

Add. 2,500

Transformer Failures w.r.t Installed Capacity (%) 11 1.2

Percentage Share in Load Shedding (In Delhi) 40 < 1

COMMERCIAL:

Average Days for New Connection Energization (Days) 51.8 8.0

Number of Electronic Meters - > 1.2 Million

% Provisional Billing 22.5 < 1

DT – Wise Energy Auditing (%) - 100

Special Courts (Nos) - 2

AT&C Losses (%) 53 < 14.0

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36


• Background


• Key Initiatives

• Results



37

Awards & Recognitions - To name a few

National Award for Meritorious Performance (For Years 2004-2005 & 2005-2006)

38


National Award for Meritorious Performance (For Year 2007-08)

39


National Award for Meritorious Performance (For Year 2008-09)

40


ASIAN POWER AWARDS – POWER UTILITY OF THE YEAR

(FOR YEARS - 2007, 2008 & 2009)

41

Edison Electric Institute (EEI) 2008 - Award for Implementation of GIS

Edison Electric Institute (EEI) 2009 – Award for Policy Advocacy



Public Lok Adalat Award for the 10,000 Settlements

in 2 ½ years

Expert Choice Award for Most Admired Organization - By

Power Line

SUGAM Award for Transparency in Billing

System

Intelligent Enterprise Award for IT initiatives

- By Indian Express

Award for Corporate Social Responsibility -

By Amity

Leadership Award for excellence in Power

Distribution – By Amity

42

43


• Background


• Key Initiatives

• Results



Issues / Areas requiring attention of Regulator :

• Appropriate balancing between the interests of all stakeholders (Consumer, Society, Environment, Govt. DISCOM etc):

a) Cost reflective tariff

b) Timely recovery of Cost

c) Encourage settlement of disputed arrears

d) Sharing of Income (Section 51, EA 2003) – Attractive sharing of profit / income to encourage Asset Sweating

e) Promotion of green power through Regulatory provisions

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• Regulatory Asset:

a) Against economic principles

b) Sends improper economic signal

c) Unnecessary burden of carrying cost

d) Deferment of problem, not a solution

e) Hence, use of this facility should be minimum and should not be repetitive

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46

• Practical approach while framing performance standard regulations keeping in view the ground realities

• Focus on long term development / sustainability of power sector

• An equitable approach towards various incentives / penalties provisions of performance standard regulations

• Regulatory provisions for introduction / promotion of new technologies / Systems

• Long term road map for the development of the power sector

• Pro-active measures to remove difficulties / problems faced by DISCOM (which are beyond the reasonable control of DISCOM)


Harmonization of regulations in power sector :

• Fuel price variance:

a) Immediate pass through for Generator

b) Annual / Periodic pass through for DISCOM

• Large disparity on treatment of various parameters:

a) O & M Costs (Normative Vs Actual)

b) Consolidated O & M Costs

c) Separate allowance for employee / A & G / R & M Costs

d) R & M Costs: Yearly inflation / % of Gross Fixed Asset

e) Employee and A & G Costs: Yearly inflation / Yearly inflation together with increased growth (MU / Consumers)

47



f) Depreciation rate:

- Ministry of Power, GOI specified rates

- CERC rates (2004 notification) with provision of Advance Against Depreciation (AAD) provision

- As per Companies Act

g) Allowance of Depreciation:

- Allowed on all assets

- Depreciation not allowed on assets financed from grants / consumer contribution

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h) Start Date for depreciation:

- From the year of Capitalization

- From the succeeding year after capitalization

i) Provisioning of bad debts:

- No provision

- Based on actual bad debts

- As a % of approved ARR

j) Return:

- Return on Equity

- Return on Capital

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Thank You

NDPL Performance Improvement of the Distribution Segment ... - Y S Butola - Performance... · Performance Improvement of the Distribution Segment (A Case Study of NDPL) Arup Ghosh

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