With the release of the Smart Grid Vision and Roadmap for India, the Ministry of Power has set the agenda for a phased roll-out of smart grid technologies. Importantly, this will facilitate the process that was initiated with the allocation of 14 pilot projects in the power distribution segment. The pilot projects, based on automated metering infrastructure (AMI), will test key functionalities such as demand response, peak load management and outage management. One of them at Puducherry has already taken off, and preliminary results show enhanced capabilities in areas such as fault detection, load management, and billing and collection.
Most of the pilot projects could be completed by mid-2015. By then, the industry has to prepare for the next level of technology transition. Extension of the ongoing Restructured Accelerated Power Development and Reforms Programme (R-APDRP) is a route to build up capabilities. Also, the existing base of automated meter reading (AMR) systems, so far limited to industrial consumers, could be built upon for an AMI-based framework. As yet, technology deployment is at an early stage, and will have to be refined through experience as well as research and development (R&D).
Building on the R-APDRP
R-APDRP projects are expected to be concluded by the end of the Twelfth Plan period. The groundwork under the R-APDRP, such as the establishment of baseline data, an energy accounting system, and strengthening/upgradation of the sub-transmission network, sets the basis for deploying advanced solutions. These projects could be leveraged for the technology transformation envisaged under a smart grid framework.
Various functionalities could be added to those under the R-APDRP. The India Smart Grid Forum recently submitted a white paper on this issue to the Power Finance Corporation, as part of the latter’s efforts to chart the future course of the R-APDRP. The recommendations in this regard suggest the next set of projects that could be undertaken after successful completion of the R-APDRP.
Some of the key areas suggested to build on the R-APDRP include:
- Changes in the business process to make extensive use of the real-time digital network to reflect the dynamic nature of the power distribution network. Enterprise resource planning (ERP) should be used to integrate the automated processes implemented under the R-APDRP
- Integrated ERP with business analytics for key areas such as assessment of the residual asset life, predictive maintenance, network planning and theft control
- Load forecasting in power distribution, to be undertaken based on data generated from IT-based energy monitoring systems, for each consumer segment
- Introduction of fault current limiters and fault current controllers
- A phased introduction of transformer monitoring systems, beginning with real-time monitoring of all distribution transformers in R-APDRP-covered towns
- A phased extension of the R-APDRP’s key functionalities such as billing and CRM, asset mapping, consumer indexing, AMR for feeders and transformers, etc.
- Implementing the distribution management system, covering the power distribution network up to the 11 kV voltage level
- Introducing outage management systems (OMS) and integrating them with CRM, ERP and asset management systems.
It has also been suggested that extension of the R-APDRP’s scope should be coordinated with other national or state-level programmes that are under way. Thus, newly electrified villages and households, under rural electrification schemes, could be integrated with R-APDRP data centres. Further, automation solutions such as those in billing and collection could be utliised for a combination of utility services related to water, gas, etc. Similarly, discoms could utilise digital mapping carried out by town planning authorities to obviate the issue of delayed approvals at a later stage.
Transition to AMI
The installed base of energy metering systems in utilities varies from the basic manual reading types to AMRs and prepaid meters. A transition to AMI, regarded as the building block for the smart grid framework, could be best managed from the existing base of AMR systems, which have been so far used mainly for high tension (industrial consumers) connections. For wider adoption of smart meters, the Central Electricity Authority recently finalised the specifications for single-phase smart meters.
The proposed AMI projects have to factor in not only hardware costs (major share), but also other components such as communication, software, data management and equipment maintenance. As such, the business case for smart meter deployment also faces the issue of low per capita power consumption. In terms of technology, the smart meter deployment process faces the challenges of interoperability, choice of communication technology, data security and meeting technical standards.
Even after addressing all issues, consumer engagement could be the deciding factor in smart meter deployment, as is evident from the experience of utilities worldwide. In the Indian context, technology providers and utilities have to ensure that consumers are aware of the proposed benefits from the metering solutions such as energy/cost savings and minimum load shedding.
Policy and regulations
There is significant scope for providing policy support for the smart grid framework. It covers areas of technical standards, equipment and technology, infrastructure base, cyber security, costs, and research and development (R&D), among others. Also, the policies have to be in sync with the dynamic nature of technologies. It is in this context that recent policy steps such as the preparation of the smart grid road map and finalisation of single-phase smart meters hold significance. Also important have been the steps initiated towards implementing rooftop solar projects and net metering in select states.
Other key initiatives currently under way include the setting up of the smart grid test bed at the Central Power Research Institute. The project received a grant from the US Trade and Development Agency in 2013. The power ministry is providing a Rs 100 million funding for setting up a smart grid knowledge centre with Power Grid Corporation of India Limited.
These developments highlight the policy intent towards the technology development process. Regulators need to move apace. The Maharashtra Electricity Regulatory Commission has constituted the Smart Grid Coordination Committee to promote state-specific smart grid initiatives. This is a first-of-its-kind step by a state electricity regulatory commission (SERC). There is a need for greater regulatory involvement for smart grid investments, especially for deliberating on issues related to the tariff mechanism, demand response systems, grid security and stability concerns, etc.
As things stand, steps taken by the regulators include the restricted free governor mode of operation, grid integration of renewable energy and automatic demand management. Some of the key ongoing initiatives include drafting specifications for smart meters, formulation of technical standards for the grid connectivity of renewable energy and introducing regulations for operational standards. As the industry moves ahead in deploying a smart grid framework, regulators will have to be sensitised about upcoming technologies and their cost-benefit analysis.
The ongoing pilot projects are being keenly watched by all stakeholders, not only for the feasibility of technologies, but also to gauge the market developments around these projects. Both the utilities and technology providers have to contribute and share the risks/benefits. Regulators’ response is not clear, though two upcoming projects (in Gujarat and Maharashtra) have already received consent from their respective SERC.
Of the 14 projects allotted in the distribution segment, the Puducherry project has made the most significant progress. The project, implemented by Powergrid, has deployed systems such as AMI, OMS, virtual demand response, power quality management, the smart street lighting system, and net metering. The preliminary results are promising. The Puducherry electricity department has started billing consumers on the basis of net metering, while there has been an improvement in the quality of power supply. Further, transformer-wise energy auditing is being conducted to check network losses.
In four states, Karnataka, Kerala, Maharashtra and Gujarat, request for proposals (RfP) have been issued and bid evaluation is under way for smart grid pilots. RfPs will be soon issued for projects in Andhra Pradesh, Himachal Pradesh, Punjab and West Bengal. The bidding experience of utilities indicates some of the challenges facing this industry. For instance, in Uttar Gujarat Vij Company Limited’s tender for the smart grid pilot project, meter manufacturers did not participate as lead bidders. The utility also found that Indian companies had limited expertise, while the imported technology solutions offered by select players were not tested for Indian conditions. In Maharashtra, where the RfP was issued in October 2013, the last date for bidding had to be extended to end- February 2014 due to muted response. Besides market-related challenges, there are issues related to last-mile connectivity, technology integration, scalability and ageing assets. Also, the technologies are at an evolution stage and are prone to obsolescence with global innovations.
The way ahead
The trajectory for future smart grid technology deployment is not well defined. Despite potential, critical aspects such as return on investments and the tariff impact of future projects remain unclear. Thus, the experience gained from pilot projects, the cost of equipment and technology, indigenisation and R&D progress will influence the investor outlook.
Policymakers will play a key role in driving smart grid deployment. There are plans to launch a smart grid mission, on the lines of the eight missions under the National Action Plan on Climate Change. The first set of smart grid standards could be developed by end-2014. Further, state-specific smart grid road maps are under consideration as a follow-up to the national-level road map formulated recently.