CORPORATE STRATEGY FOR

ENERGY INTENSIVE
INDUSTRIES
EVOLUATION OF POWER INDUSTRIES

¾ In earlier days, due to low priority,

Generation Plants were privately owned.
¾ System of Licensee
¾ For better reliability in the post-
independence period, power industry was
nationalized.
CURRENT STATE OF AFFAIRS

¾ Due to various reasons, cost of power generation,

except in hydro, is very high.
¾ Energy intensive industry find it difficult.
¾ Monopolistic status cause of inefficiency and high
cost.
¾ For competition, Reforms are being undertaken in
the power sector.
¾ Central Sector has enacted Electricity Act 2003.
¾ Electricity Act 2003 provides new options to the
industries.
 ENERGY INTENSIVE INDUSTRIES CAN
ADOPT ONE OF THE FOLLOWING OPTIONS :

¾ Captive Power Plant

¾ Outsourced Captives
¾ Open Access in Distribution
¾ Better Managed Distribution Companies
¾ Control over, time of operation
¾ Non Conventional Source of Energy
¾ Energy Conservation.
1. Captive Power Plant

¾ Captive Power Plant can be set up by any person.

¾ Can be set up by Co-operative Society or
Association of persons.
¾ Opens new opportunity for structuring Captive
Generating Plants.
¾ CPP can be provided with open access
transmission facility.
¾ Charges to be decided by GERC / CERC.
2. Outsourced Captives :

¾ Required expertise for operating CPP is missing.

¾ O&M can be outsourced.
¾ Possible to get CPP on lease.
3. Open Access in Distribution

¾ Open access in Distribution upto 5 MW.

¾ Connected load consumer will be free to choose
the supplier.
¾ Connected load beyond 5 MW - can avail open
access.
¾ No obligation to buy power from local discom.
¾ Regulatory mechanism is yet to be formulated.
¾ Without investment, benefit can be availed.
4. Better Managed Distribution Companies :

¾ Brisk pace of reform is underway

¾ Will improve quality and reliability
¾ With competition, tariff expected to come down.
5. Control over, time of Operation :

¾ Industries can increase the drawal

during night to obtain substantial benefit
in the tariff.
6. Non Conventional Source of Energy :

¾ Act provides big thrust on non-conventional

sources of energy.
¾ Increasing consciousness on pollution caused by
fossil fuel.
¾ Encourage energy intensive industries the large
incentive source being given by State & Central
Govt. in the form of benefit, subsidies etc.
¾ They can wheel the power to their plant.
¾ Also easy carbon credits, which could be traded
in future.
7. Energy Conservation :

¾ Focus on Energy Audit

¾ Adoption of new Industry – Plant design.
CONCLUSION :

There is no ready made solution.