APDRP

Question: 1. What are the Objectives of APDRP? Answer: The main objectives of APDRP are 1) Improving financial viability 2) Reduction of T&D losses to around 10% 3) Improving customer satisfaction 4) Increasing reliability of power supply 5) Improving quality of supply 6) Adopting systems approach with MIS 7) Bringing Transparency through computerization Question: 2. Who will fund the power sector projects under APDRP? Answer: Power sector projects are funded by Ministry of Finance, Government of India under the advice from Ministry of Power. The payment would be Channelied through a designated agency as identified by MOP for smooth implementation of the programme. Question: 3. What are the six level intervention strategies in power sector under Distribution Reforms? Answer: Ministry of power has formulated a six level intervention strategy to rejuvenate the power sector, primarily to make it viable. Efforts are to focus on reforms in the distribution sector to improve accountability & revenue realization in the form of increased metering conversion of Un metered connections to metered connections, addition of fresh connections, higher billing and collection efficiency. Technical, commercial, financial, IT, organizational interventions have been devised as part of the six level intervention strategy. These strategy for Distribution reforms would envisage interventions at the following levels: National Level Interventions The basic issues at national level are related to policy issues, legislation, uniform standards, and energy conservation, accounting standards. State Level Interventions The basic issues confronting the state level interventions are formation of SERc, issuance to regular tariff orders, providing legislative support for involving local bodies in management of Distribution business, removal of tariff anomalies, subsidies and budgetary support.

SEB Level Interventions The basic issues confronting the SEB level interventions are Restructuring, accountability, commercial accounting, integrated management information system, grid discipline and TOD metering. Distribution Circle Level Increase in income: Increasing the billing, reduction of pilferage, more remunerative pricing of the commodity (energy) and optimum utilization of physical assets and brand value of the supplier. Reducing the Expenditure: Sourcing of the least cost energy and reducing the energy management or energy handling cost. In order to achieve the objectives of a retail business model it is proposed to convert the circle as a independent identifiable business unit of the DISCOM. FEEDER Level Intervention 11 kV Feeders are the basic source of income to an electricity utility. The issues confronting it are Metering and Billing, Bill collection, Abnormal Voltage, segregation of losses and over all ensuring quality of power supply. Consumer Level Intervention The basic issues at Consumer level are related to Mandatory metering, compliance of billing, consumer satisfaction, and energy conservation. Question: 4. What are the developments of Distribution Circles as centres of excellence under APDRP? Answer: Ministry of power after detailed deliberation with the experts, has identified for each circle certain short & long term measures which are considered essential to achieve distribution reform to make the circles as centres of excellence. 1) A scheme was launched in 2000-01 with initial provision of Rs.1000 cr., for reoriented with introduction of reforms element. 2) The Govt. has approved the proposal of Ministry of power for the six level intervention strategies for distribution reforms. The approval envisages an expenditure of Rs.40, 000 Crore during tenth five year plan under APDRP scheme. 3) An outlay of Rs.20,000 Cr has been provided as central plan assistance under APDRP to state governments for implementing the up gradation and modernization of sub transmission and distribution scheme under investment component. 4) Rs. 20,000 cr has been provided for incentive to the performing states by way of reduction in cash losses. Question: 5. Procedure for release of Funds under APDRP?

Answer: The Projects schemes appraised by NTPC/POWERGRID are put up to APDRP sub monitoring committee of Ministry of Power. On advise of Ministry of Power, Ministry of Finance releases the funds to respective states for the approved projects under APDRP in accordance with the procedure for disbursement as given below. 25% of the APDRP amount- up front on approval of project under APDRP and on issue of sanction letter by the Financial Institutions. Release of matching fund by financial institutions (Fis) After Spending 25% of the project cost (i.e 25% APDRP + 25% of loan component from Fis), 50% of the APDRP amount would be released. Progressive release, the balance 50% of the APDRP amount by FIs After spending 75% of the project cost (i.e 75% APDRP + 75% of loan component from FIs) Balance 25% of the APDRP amount will be released. Progressive release of the balance 25% of the APDRP amount by FIs.

Question: 6. What is the role of NTPC & Power Grid under APDRP? Answer: The roles of NTPC & POWER GRID under APDRP are: 1) Advise and help SEBs/Utilities in preparation of DPRs and wherever requested specifically by utility, they shall prepare DPR for states as consultant. 2) Assist SEBs/Utilities in prioritization of schemes for urban areas in distribution circles and ranking of projects for improvement in revenue collection and increase in customer satisfaction. 3) Assist Monitoring committee for review of techno economic appraisal of the DPR prepared by utilities. 4) Assist MoP in prioritization of available funds to be allocated to states/Utilities under APDRP schemes 5) Monitor periodically the physical and financial progress of various distribution circles for which APDRP funds have been allocated and disbursed. 6) Advise MOP in devising guidelines for uniformity of approach in preparation and evaluation of project proposals and disseminating information on best practices under APDRP scheme. Question: 7. What is the systematic approach to ascertain incentives claim of SEBs/Utilities under APDRP?

Answer: In order to follow systematic approach to ascertain the incentive claims of SEB/Utilities, The following guidelines for calculating incentive claim for cash losses reduction has been worked out. -Financial year-2001-02 shall be considered as a base year for comparison of incentive. -All future loss reductions would be with reference to the base year to start with. -As the gap or loss reduction has to be macro and over-all basis, the sum total of the losses for all entities will be compared with the base year. The cash loss reduction shall be calculated without the subsidy support of the state government both in the base year as well as the subsequent years. -Once an incentive has been drawn for improvement that would become the benchmark to compare for future improvements and therefore any deterioration thereafter, in the performance would be ignored to incentives the steady improvement. -Only cash sales are to be considered for the calculation of cash loss reduction. Thus any deterioration in the amount of sundry debtors will have to be taken out from the purview of loss/profit. -The accounts should be audited and C&AG should certify this account. Question: 8. What is the role of Financial Institutions under APDRP? Answer: The Financial Institutions would be participating in financial vetting of the schemes for ensuring their bank ability. They would also review the provisional and audited profit and loss accounts and balance sheets for the purpose of release of incentive and other parameter like-Concurrent project monitoring & reporting -Verification of technical specifications -Capacity building?-Quality checks during executing -Post project benefit evaluation Question: 9. How do accountability & associated responsibility and authority measured in determining the profit centers in distribution sectors under APDRP? Answer: In the competitive market environment of todays business cannot survive unless there is total accountability and associated responsibility and authority. Distribution sector also needs to be treated as a business entity-The head of the business units will be empowered to act and be held accountable for their actions & performance.

-The performance parameters as well as benchmarks are set. -A sense of ownership and competition is created. The segregation of business units of utilities is done on business accounting basis and financial practices adopted on the following lines. -Input Energy handled/sold. -Revenue realized from sales and cost incurred on purchase of input energy. -Expenditure incurred on O&M, repairs, spares, supplies, consumables etc. Question: 10. Who are the Accredited agencies for project formulation, project evaluation, project monitoring, Implementation, energy audit under APDRP? Answer: A committee is formed with members from NTPC, PGCIL, PFC, CEA, SEB/Utilities, Credit rating agencies, FIs etc will constitute to accredit reputed agencies for the purpose of project evaluation, project monitoring, Implementation, energy audit & accounting.

Question: 11. How does capacity building exercise helps SEB personnel in preparing detailed project reports for each distribution/circle within SEBs/Utilities? Answer: Capacity building exercise helps SEB personnel by -Training the man power -Energy audit & accounting studies? -Making the SEB officials collect relevant data from each 11 KV feeder in the identified circles. -Analysing of the data using computer tools to prepare feeder wise computer aided least cost project report. -Supervision of Implementation. Question: 12. Who will formulate the Detailed Project Report-DPR, assist in technical & managerial skills, and conduct capacity building exercise for SEBs/Utilities under APDRP? Answer: The Ministry of Power identified NTPC & Power Grid Corporation Limited as the lead Advisor-cum-consultants and brought CPRI, MECON under the charge of NTPC & WAPCOS,NPC,ERDA under the charge of Power Grid. The Advisor cum- consultants shall assist SEBs/Utilities as follows.

-Assists in formulating Detailed Project Reports. -Oversee the Implementation of the Project. -Assists in Technical & Managerial Skills by focusing on the required activities. -Conducting capacity building exercise. Question: 13. Who will appraise the DPR- Technical & Finance under APDRP? Answer: The DPR shall be forwarded to the MOP for review and appraisal. The MOP reserves the right to get the DPR-Technical reviewed by NTPC, POWERGRID. After technical appraisal the DPR shall be forwarded to financial Institutions for checking the commercial viability of the proposals. Question: 14. What are the measures taken to reduce the technical loss reduction under APDRP? Answer: The following are the measure -Installation of capacitors at all levels. -Re-conducting of over loaded section. -Re-configuration of feeder lines & distribution transformers so as to reduce the length of LT lines. -Make the system less LT oriented by installation of smaller size energy efficient distribution transformers so that each transformer supplies power to 10 to 15 house holds only. -Development of digital mapping of the entire assets of distribution system. -Computerized load flow studies so that investments could be undertaken for longterm strengthening of the distribution system. Question: 15. Who will assist in technical specification & standardization of equipments used in the distribution section? Answer: The Indian Electrical & Equipment manufacturing Association, the Confederation of Indian Industry & Bureau of Indian standards will assist in technical specification & standardization of equipments like electronic & static meters, transformers, capacitors, conductors, Insulators etc used in distribution sectors. Question: 16. What is the action plans accepted under Chief Ministers National Action plan (CMNAP) for power sectors?

Answer: The action plan under CMNAP identified and accepted are -Establishing independent regulatory commissions at Central and state levels. -Minimum of 50 paise per kwh to be charged as agricultural tariff in phases. -Withdrawal of flat rates and metering of all connections Question: 17. What are the factors involved in analyzing the load factor? Answer: Load forecast is extremely important in planning, distribution network and capacity addition. The factors involved in analyzing load forecast are -Analysis of past trends of growth in electricity demand -System load forecast viz. forecasts of load for the entire study area -Spatial or small area load forecast (Division of Utility service 1area into sufficiently large number of small areas and forecast for each small area)

Electricity Act-2003
Question: 18. How does the enactment of Electricity Regulatory commission Act-1998 helps? Answer: This helps in paving the way for creation of independent regulatory commissions at the center and in the states with a view to bring in Electricity Act Question: 19. What are the main objectives of Electricity Act-2003? Answer: An Act to consolidate the laws relating to generation, transmission, distribution, trading and use of electricity by taking the following measures. -Taking conducive measures to develop electricity industry -Supply of electricity to all users -Protecting consumer Interest -Rationalization of electric tariff -Transparency in policies regarding subsidies -Promotion of efficient & environmentally policies constituted by Central Electricity Authority (CEA), Regulatory commissions & establishment of Appellate tribunal. Question: 20. Is Electricity Act-2003 extended to whole of India? Answer: Yes, The Electricity Act-2003 is extended to whole of India except the state of Jammu & Kashmir.

Question: 21. What does the term Dedicated Transmission lines means? Answer: Dedicated Transmission lines means any electric supply line for point to point transmission which are required for the purpose of connecting electric lines or electric plants or generating stations or any transmission lines or sub station or generating stations or load centre. Question: 22. What does the term Distribution licensee means? Answer: Distribution licensee means a licensee, authorized to operate and maintain a distribution system for supplying electricity to the consumers in his area of supply. Question: 23. What does the term Power Systems means? Answer: All aspects related to generation, transmission, distribution and supply of electricity which includes one or more of the following. -Generating stations -Transmission or main transmission lines -Sub-stations -Tie-lines? Load dispatch activities -Mains or distributing mains -Electric supply lines -Overhead lines -Service lines -Works Question: 24. What does the Regional Power Committee do? Answer: Regional Power Committee is established by the Central Government for a specified region for facilitating the integrated operation of the Power system in that region. Question: 25. What do you mean by Stand-alone system? Answer: Stand-alone system means the electricity system set up to generate power & distribute electricity in a specified area without connecting to the Grid. Question: 26.What do you mean by Transmission lines? Answer: Transmission lines" means all high pressure cables and overhead lines (not being an essential part of the distribution system of a licensee) transmitting electricity from a generating station to another generating station or a sub-station, together with any step-up and step-down transformers, switch-gear and other works necessary to and used for the Control of such cables or overhead lines, and such buildings or part

thereof as may be required to accommodate such transformers, switchgear and other works. Question: 27. Who will prepare & publish National Electricity Policy and tariff policy Plan? Answer: The Central Government shall, from time to time, prepare & publish the national electricity policy and tariff policy plan, in consultation with the State Governments and the Authority for development of the power system based on optimal utilisation of resources such as coal, natural gas, nuclear substances or materials, hydro and renewable sources of energy. Question: 28.How does any person transmit or distribution or under take trading in electricity? Answer: Any person is allowed to transmit or distribute or under take trading in electricity provided he has authorized license issued under section-14 or is exempted under section-13. Question: 29. What is the network for Transmission of Electricity in the country? Answer: The Central Government makes region-wise demarcation of the country, and, from time to time, makes such modifications therein as it may consider necessary for the efficient, economical and integrated transmission and supply of electricity. -The Central Government may establish a centre at the national Level, to be known as the National Load Dispatch Centre for optimum scheduling and dispatch of electricity among the Regional Load Dispatch Centres. -The National Load Dispatch Centre shall be operated by a Government company or any authority or corporation established or constituted by or under any Central Act, as may be notified by the Central Government? -The Central Government shall establish a centre for each region to be known as the Regional Load Dispatch Centre having territorial jurisdiction as determined by the Central Government for the purposes of exercising the Powers, and discharging the functions under this Part. -All directions issued by the Regional Load Dispatch Centres to any transmission licensee of State transmission lines or any other licensee of the State or generating company (other than those connected to inter State Transmission system) or substation in the State shall be issued through the State Load Dispatch Centre. Question: 30. What are the responsibilities of Regional Load Dispatch Centre? Answer: The Regional Load Dispatch Centre shall,

-Be responsible for optimum scheduling and dispatch of Electricity within the region, in accordance with the contracts entered with the licensees or the generating companies operating in the region. -Monitor grid operations; -Keep accounts of the quantity of electricity transmitted through the regional grid; -Exercise supervision and control over the inter-State transmission system. -Responsible for carrying out real time operations for grid control and dispatch of electricity within the region through secure and economic operation of the regional grid in accordance with the Grid Standards and the Grid Code. Question: 31. What are the responsibilities of State Load Dispatch centre? Answer: The State Load Dispatch center shall: -The State Load Dispatch Centre shall be the apex body to ensure integrated operation of the power system in a State. -Responsible for optimum scheduling and dispatch of electricity within a State, in accordance with the contracts entered into with the licensees or the generating companies operating in that State. -Monitor grid operations. -Keep accounts of the quantity of electricity transmitted through the State grid; -Exercise supervision and control over the intra-state transmission system. -Responsible for carrying out real time operations for grid control and dispatch of electricity within the State through secure and economic operation of the State grid in accordance with the Grid Standards and the State Grid Code. Question: 32. What are the features available under Electricity Act-2003 for Electricity Bill 2003? Answer: Following are the features under Electricity Act-2003 for Electricity Bill-2003. -The central Government to prepare a National Electricity Policy in consultation with state governments? -Trust to complete the rural electrification and provide for management of rural distribution by panchayats, cooperative societies, non-government organizations, franchisees, etc.

-Provision for license free generation & distribution in the rural areas, Generation, being de-licensed and captive generation being freely permitted. -Hydro projects need clearance from the central electricity authority. -Transmission Utility at the central as well as state level, to be a government company with responsibility for planned and coordinated development of transmission network. -Provision for private licensee in transmission & entry in distribution through an independent network. -Open access in transmission from the outset. -Open accesses in distribution to be introduced in phases with surcharge for current level of cross subsidy to be gradually phased out along with cross subsidies and obligation to supply. SERs to frame regulations within one year regarding phasing of open access. -Distribution licensees would be free to undertake generation and generating companies would be free to take up distribution licensees. -The State Electricity Regulatory commission is a mandatory requirement. -Provision for payment of subsidy through budget? -Trading, a distinct activity is being recognized with the safeguard of the Regulatory commissions being authorized to fix ceilings on trading margins, if necessary. -Provision for reorganization or continuance of SEBs? -Metering of all electricity supplied made mandatory? -An Appellate Tribunal to hear appeals against the decision of the CERC and SERc. -Provisions relating to theft of electricity made more stringent.