Making Progress: Status of key central government schemes for distribution automation

Status of key central government schemes for distribution automation

Public as well as private power discoms in India have been deploying IT solutions at various levels. Given their poor financial condition, state discoms are generally dependent on central government schemes like the Restructured Accelerated Power Development and Reforms Programme (R-APDRP), the Integrated Power Development Scheme (IPDS) and the National Smart Grid Mission (NSGM) for implementing the latest and most relevant IT systems in their distribution operations. Private discoms, which have consistently invested in IT systems in the past, are also making substantial investments in technology upgrades.

The popular IT systems that have been deployed or are under consideration include supervisory control and data acquisition (SCADA), geographic information systems, enterprise resource planning systems, customer relationship management systems, outage management systems, peak load management systems, power quality management systems, microgrids, and distributed generation and advanced metering infrastructure for residential and industrial consumers.

A look at the key central schemes supporting distribution automation and their current status…


Launched in November 2014 under the Union Budget 2015-16, the scheme aims to strengthen the sub-transmission and distribution network in urban areas by reducing aggregate technical and commercial losses (AT&C) losses; undertaking metering at various points like distribution transformers and feeders; and establishing IT-enabled energy accounting and improved billing and collection efficiency. The first two components have an allocated outlay of Rs 326.12 billion, of which Rs 253.54 billion will be covered through gross budgetary support from the Government of India (GoI). The R-APDRP has been subsumed under the last component of the new scheme for completing the work that remains under it. Subsequently, its Rs 440.11 billion outlay has been carried forward to the IPDS.

The Power Finance Corporation (PFC) has been appointed the nodal agency for implementing the scheme, while a project management agency (PMA) under the Ministry of Power (MoP) is responsible for monitoring projects. Under the scheme, projects are to be completed within two years from the issue of the letter of award. All state and private discoms are eligible to participate in it. For private discoms that have an area of supply in urban areas, projects will be implemented through a state government agency and the associated assets will be owned by the state government and state-owned agencies. Utilities are required to appoint a PMA for monitoring and ensuring timely implementation.

The government will offer 60 per cent of the project cost as a grant (85 per cent in the case of special category states). Discoms have to contribute at least 10 per cent of the cost (5 per cent for special category states) and avail of the remaining as loan. However, discom contribution can go up to 40 per cent (15 per cent in the case of special category states) in case they do not avail of the loan. The maximum eligible add-itional grant would be 15 per cent (5 per cent in the case of special category states) on the achievement of the prescribed milestones. The government will provide a 100 per cent grant towards the expenditure incurred on activities for bridging the missing links of the National Optical Fibre Network project, training and capacity building, and establishing a national power data hub at the Central Electricity Authority (CEA).

The government will release an additional grant by converting 50 per cent of the loan com-ponent into a grant on the condition that certain milestones are achieved. These include project completion within the approved time schedule, reduction in AT&C losses as per the trajectory finalised by the MoP in consultation with state governments, and the upfront release of the admissible revenue subsidy by the state government based on metered consumption. In June 2015, the central government finalised the common standard bidding documents for the scheme.


Launched in 2008 with a focus on improving utility performance, particularly in terms of AT&C loss reduction, the R-APDRP has been merged with the recently launched IPDS for the Twelfth and Thirteenth Plan periods. PFC, the nodal agency, has been coordinating the progress of both parts of the programme. Part A involves the establishment of baseline targets for AT&C loss reduction; the deployment of IT applications for energy accounting; and the setting up of IT-based consumer service centres and SCADA systems for big cities (with a population of 400,000 and an annual energy input of 350 MUs). Part B, meanwhile, aims to strengthen as well as upgrade the distribution network.

Under Part A, 953 towns of the 1,412 towns sanctioned across 31 states have gone live as of June 30, 2015. In particular, work has been completed in 13 states: West Bengal, Sikkim, Tripura, Uttar Pradesh, Himachal Pradesh, Uttarakhand, Punjab, Andhra Pradesh, Telangana, Maharashtra, Chhattisgarh, Madhya Pradesh and Gujarat. In addition, of the Part A SCADA schemes sanctioned for all 72 eligible towns across 20 states, control centres are reported to be ready in 20 towns.  Under Part B, work has been completed in 265 towns out of the 1,259 towns sanctioned across 27 states. The approved Rs 440.11 billion outlay for the R-APDRP includes budgetary support of Rs 227.27 billion.

National Smart Grid Mission

In May 2015, the government approved the NSGM for promoting smart grid development in India. The mission is expected to provide an overarching framework for planning and monitoring the implementation of policies and programmes for smart grid activities in India.

The NSGM will have a three-tier structure, with a governing council headed by the power minister. The council, which will have secretary-level officers of the concerned ministries as members, will approve all policies and programmes for implementing smart grids. The second level will have an empowered committee headed by the power secretary, with joint secretary-level officers of ministries as members. This committee will provide policy inputs to the governing council and approve, monitor and review specific projects. The third tier will comprise a technical committee headed by the chairperson of the CEA.

The total outlay for the mission is Rs 9.8 billion, which includes budgetary support of Rs 3.38 billion. Up to 30 per cent of the project cost for most components will be provided as a grant under the NSGM budget. For selected components like training and capacity building, the funding will be from a 100 per cent grant. Corresponding to the NSGM, each state will have a state-level mission as well. The Smart Grid Knowledge Centre being developed by Power Grid Corporation of India Limited (Powergrid) will act as a resource centre for providing support to the mission in all technical matters. The NSGM Project Management Unit (NPMU), housed at Powergrid, will be responsible for the mission’s day-to-day operations.

The India Smart Grid Task Force (ISGTF), under which 14 pilot projects are being undertaken, will be merged with the NPMU. The total estimated cost of the pilot projects is Rs 4 billion, and their implementation will allow smart grid technologies in the distribution segment to be tested.

The government has sanctioned Rs 111.9 million for three pilot projects during 2015-16 – Rs 40.7 million to Chamundeshwari Electricity Supply Corporation Limited (Mysore), Rs 24.3 million to the Himachal Pradesh State Electricity Board, and Rs 46.9 million to IIT Kanpur, which is undertaking a project titled Development of R&D Platform for Smart City Projects. However, the implementation of these pilot projects has been delayed.

The major reasons for this are the delays in the preparation of detailed project reports due to state-of-the-art technology deployment, the lack of expertise among utility staff, the initial lack of response from bidders and the extremely high prices in certain cases. The measures taken to expedite project work include capacity building activities for utility personnel, mutual collabor-ation between utilities for sharing knowledge; and the resolution of common issues and continuous project monitoring through the ISGTF secretariat. Utilities have also been allowed to engage consultants like Powergrid, the Central Power Research Institute and private consultants to bring in the required expertise.