Energy Profile

8/13/2019 Energy Profile

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KarnatakaKarnataka: Energy Sector Profile

(Conventional, Renewable, Alternate Energy Sources)

Global Investors Meet - 2012

Lead Organiser

Event PartnerKnowledge Partner


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Topic

Global energy Sector: Overview

Energy Sector in India: Overview

Energy Sector in Karnataka: Overview

Current Initiatives in Energy Sector in Karnataka: Gas Pipeline

Renewable Energy Opportunities: Wind Energy

Renewable Energy Opportunities: Solar Energy

Public Sector Agencies in Power Sector in Karnataka

Investment Potential in Karnataka

Value Propositions and Investment Opportunities

Policy Initiatives: A snap shot

M &A Scenario in Energy Sector in India

Investment Opportunities

Shelf of Projects

Karnataka Energy Prole

I N D E X


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Global Energy Sector: an Overview

Although 80 percent of the worlds popula-

tion lies in the developing countries, their

energy consumption amounts to only 40

percent of the world total energy con

sumption.

Rapid population growth in the developing

countries has kept the per capita energy

consumption low compared with

that of highly industrialized developed

countries.

World oil and gas reserves are estimated

at just 45 years and 65 years respectively.

Coal is likely to last a little over 200 years.

Oil equivalent (kgoe) per person of primary energy

In industrialized countries, people use four to ve t imes more than the world

average, and nine times more than the average for the developing countries.

An American uses 32 times more commercial energy than an Indian.

Source: Integrated Energy Policy, Government of India

Global installed power generation capacity and additions by technology in

the New Policies Scenario

Renewable and nuclear power account for more than half of all the new capacity added worldwide through to 2035

Source: World Energy outlook 2011.



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Global Energy Sector: an Overview

Coal The proven global coal reserve was estimated to be

861 billion tonnes by end of 2010. The USA had the

largest share of the global reserve (27.6%) followed

by Russian Federation (18.2%), China (13.3%).

Australia (8.9%). India was 5th in the list with 7.0%.

Oil The global proven oil reserve was estimated to

be 1,383 billion barrels by the end of 2010. Saudi

Arabia had the largest share of the reserve with

almost 19.1%. (One barrel of oil is approximately

160 liters)

Global subsidies to renewables-based electricity and bio-fuels by region in

the New Policies Scenario

Renewable subsidies of $66 billion in 2010 (compared with $409 billion for fossil fuels),reach$250 billion in 2035 as rising deployment

outweighs improved competitivenessSource: World Energy outlook 2011

Global Primary Energy Reserves *

Gas The global proven gas reserve was estimated to be 187 trillion

cubic meters by the end of 2010. The Russian Federation had

the largest share of the reserve with almost 23.9%.

*Source: BP Statistical Review of World Energy 2011



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Energy Sector in India: Overview

To support Indias continuous and robust economic

growth, there has been a concurrent growth in the

Indian energy sector.

India has the fth largest electricity generation

capacity and third largest transmission and

distribution network in the world.

Major sources of power are thermal, hydro, renewable

and nuclear with thermal contributing to 82% of the

total generation and 65% of the installed capacity

(2011-12) (till 29 February 2012) (Source: http://

cea.nic.in/reports/monthly/executive_rep/feb12/1-2.

pdf) grown at a CAGR of 7.4% and generation has

grown at a CAGR of 4.8% in the last four years (March

2008 to February 2012)

111% increase in the total outlay for energy sectorin

the last 2 ve year plans from US$ 80 billion (INR 4

lakh crores) to US$ 170 billion (INR 8.5 lakh crores).

FDI worth US$ 1,320 million (INR 6,600 crores)

received between April 2009 to January 2010 with

sector enjoying 100% FDI limit.

The Plant Load Factor (PLF) of the Southern region is

highest (80.25) compared to other regions.

Ministry of Power, Government of India, initiated

power sector reforms that have improved operating

structures, commercial orientation, transparency in

operations and overall customer orientation.

In the recent past, interest in renewable sources of

energy has increased, which has a huge potential.

Installed Capacity Vs Power Generation in India

a: Calendar Year p: Provisional

Source: Economic Survey 2011-12

Captive power plants (CPP) also make a major

contributionwhich is more than one fth of the total installed

capacity.

Captive Generating capacity connected to the Gridacross

India (as on 29 February 2012) is about 19,509 MW.

CPP power comes in handy at a much lower tariff to the

distribution companies.

Sources of Power Generation in India

As on 29 February 2012

RES -Renewable Energy Sources includes Small Hydro Project(SHP),Biomass Gas(BG), Biomass Power(BP), Urban & Industrial waste

Power(U&I), and Wind Energy.

Source: http://www.cea.nic.in/reports/monthly/executive_rep/

feb12/8.pdf



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Generation

Karnataka has always been on the forefront in power

generation.

Asias 1st major hydro electric generating station was

set up in Karnataka in 1902; Ranks 2nd in installed

hydro capacity at 3,599.8 MW

Karnataka has a total installed capacity of 11,546 MW

i.e. 6.64% of the total power generated in the country

(2010-11).The proposed and the ongoing projects in

Karnataka together contribute 18,183 MW.

In terms of total installed capacity of power plants

Karnataka stands 5th and in terms of State initiated

power plants, Karnataka stands 3rd in the country.

Largest Ownership share: State - 57%, Private sector -

32%, Central- 11%.

Inspite of state taking initiatives increasing the power

generation there is a lot of scope for the private

investments in the state.

The state has a total 95 power generation stations

with installed capacity of 6,005 MW.

The state is also home for major Independent Power

Producers (IPPs) withtotal installed capacity of 3,609 MW.

Top 5 States in Installed Capacity (MW) in India


Source: http://www.cea.nic.in/reports/monthly/executive_rep/feb12/8.pdf

Installed Capacity (mws) in Karnataka

RE: Revised Estimates P: Provisional

A: Actuals

Source: Economic Survey of Karnataka 2011-12

Sources of Power Generation in Karnataka

MNRE: Ministry of New and Renewable Energy


RES -Renewable Energy Sources includes Small Hydro Project (SHP), Biomass Gas

(BG), Biomass Power (BP), Urban & Industrial waste Power (U&I), and Wind Energy.

Source: http://www.cea.nic.in/reports/monthly/executive_rep/feb12/8.pdf



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Grid map of Karnataka

Source: http://110.234.115.69/GRIDMAP_FINAL_BIG_10-06-11.jpg



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Source wise Potential and Proposed Capacity Addition in Karnataka

Current Initiatives in Energy Sector

in Karnataka: Gas Pipeline

Sailent Features of DBPL

1,370 km Dabhol Bangalore Natural Gas

Pipeline

Main trunk line, which will extend from

Dabhol to Bidadi

Planned transmission capacity of 16 MMcm/d

Construction cost of US$ 153 million (INR 765

crores)

Construction completion by December 2012

Development of Gas based power plants along

the Pipeline (~ US$ 4 Billion) (INR 20,000

crores)

Dabhol Bangalore Pipeline

Renewable energy Source Potential Capacity(in MW)

Installed capac-

ity

(in MW)

Capacity addition by 2014 MW

Target Cumulative

Wind power12,950 1,368 2,969 4,337

Mini and small hydro 3,000 416 600 1,016

Cogeneration in sugar industry 1500 535 281 816

Biomass/Biogas 1,000 81 300 381

Waste to Energy 135 - 50 50

Total 18,585 2,400 4,200 6,600

Source: Karnataka Renewable Energy Policy 2009-14



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Public Sector Agencies in Power

Sector in Karnataka

GenerationKarnataka Power Corporation Limited (KPCL)

www.karnatakapower.com

Prime mover and catalyst behind key power sector reforms in the state -

measures that have spiraled steady growth witnessed in both industrial

and economic areas

Exploring, identifying and developing opportunities in power generation.

Devising innovative ways of setting up and operating power plants.

Investing in a resource base of technical competence, systems, processesand capability.

Empowering people, work teams and the support network to achieve

these objectives.

Power Company of Karnataka Limited (PCKL)

www.pckl.co.in

A Special Purpose Vehicle (SPV) to supplement the efforts of KPCL in

capacity addition.

PCKL is responsible for capacity addition by way of setting up of new

power projects through bidding process, under Case-II bidding

guidelines issued by Ministry of Power (MoP), GOI and long term

procurement of power under Case-I bidding guidelines of MoP, GoI

Facilitates for setting up of power plants, negotiations with various

industry players and Apportionment of cost of power purchased

among the ESCOMs.

Renewable EnergyKarnataka Renewable Energy Development

Limited (KREDL) www.kredl.kar.nic.in

promotion of non-conventional energy sources in Karnataka.

promote projects for harnessing energy from wind, small-hydro, biomass,

solar energy and energy recovery from wastes through private

investment.

advises the Government of Karnataka on policies to be adopted for

ensuring a systematic and balanced growth of projects for harnessing

renewable energy sources.

TransmissionKarnataka Power Transmission Corporation Limited

(KPTCL) www.kptcl.com

Encouraging best practices in transmission and distribution.

Ensuring high order maintenance of all its technical facilities.

Emphasizing the best standards in customer service.

Optimizing human and technical resources for the benet of all its

customers

Electricity Supply Companies (ESCOMS) Bangalore Electricity Supply Company(BESCOM)

Mangalore Electricity Supply Company(MESCOM)

Hubli Electricity Supply Company (HESCOM)

Gulbarga Electricity Supply Company(GESCOM)

Chamundeshwari Electricity Supply Corporation Ltd. (CESC)

The Hukkeri Rural Co-operative Society Ltd

Tariff Regulatory AuthorityKarnataka Electricity Regulatory Commission

(KERC) www.kerc.org

Tariff regulator for various ESCOMs



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Investment Potential in Karnataka

Huge potential in energy sector due to Karnatakas rapid economic growth.

PPP projects of investment worth US$ 2.4 billion (INR 11,894 crores ) under implementation stage

Renewable Energy Sources (RES): 3rd largest generator of energy through RES in India; highest wind energy potential in India at

12,950 MW

Large export potential: Addressing demand in 7 states of India

Major consumers: Irrigation pump sets (33%), Domestic lighting and All Electric Homes (23%), Industries (19%)

Consistent growth in the installed capacity: Growing atCAGR of 8.8% in the last 3 years

Continuous reduction in T&D losses:7.7% reduction in T&D losses from 2006-07 to 2010-11

Huge Outlay: US$ 2 billion (INR10,052 crores) plan outlay for energy in the Eleventh Five Year Plan constituting 9.89% of the

total outlay for all sectors.

Increase in private participation: Increase in private participation in

generation segment from 21.5% in 2008-09 to 30.4% in

2010-11.

Huge potential in non conventional energy: Additional 4,200 MW plannedby 2014 through renewable sources of energy.

Key Projects in Karnataka by KPCL:

Major Districts of Power Generation

Bijapur

Raichur

Bellary

Chitradurga

Belgaum

Gadag

Devangere

Uttar Kannada

Shimoga

Mandya

Thermal Generation Zone

Hydro Power Generation

PPP projects under

implementatio

KPCL Projects District MW

Almatti Dam Power Bagalkot 290

Kali Hydel project Uttar Kannada 1,225

Kappadagudda Wind farm Gadag 4,555

Sharavathi Hydel Project Shimoga/ Uttar Kannada 1,459

Varashi Power Station Shimoga/ Udupi 239Bellary Thermal power Bellary 500

Raichur Thermal power Station Raichur 1,470

Solar Photo Voltaic power plant Kolar, Raichur, Belgaum,

Mandya (4*3)

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Key Projects in Karnataka by PCKL:

1,320 MWGulbarga Coal based Thermal Power Project.

700 MW Gas based Power Plants each in the districts of Belgaum

(Vantamuri), Gadag (Mevundi) and Davanagere(Ragimasalavada).

1320 MW Ghataprabha Coal based Thermal Power Project.



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Value Propositions and Investment

Opportunities

Agreement with National Thermal Power Corporation

(NTPC) to put up 4,000 MW Ultra mega power project

in Bijapur district

MOU signed with Chattisgarh state for 1,600 MW

power station in Champa district. Joint venture between

KPCL and L&T Power under PPP model involving aninvestment of US$ 2 billion (INR 10,000 crore)

JV between KPCL and Bharat Heavy Electricals Limited

(BHEL) for 2,400 MW thermal power plant in Yermarus,

Edlapur and Raichur districts.

Reliance (Relogistics) to lay a 455 Km of gas pipeline

through Chennai-Bangalore-Mangalore at an

investment of US$ 1.36 billion (INR 6,796 crore ).

181

366 377

510

0

100

200

300

400

500

600

2006-07 2007-08 2008-09 2009-10

InUS$million

Growth in investment in power Development

Source: Eco nomic Survey of Karnataka 2010-11

CAGR 41%

Growth in investment in power Development

Value Propositions

In spite of investment growing at a CAGR of 41% in the last 4 years, only 71% of the demand is met by existing power

sector showing tremendous scope for growth.

Karnataka has now entered the regime of Renewable Energy Certicate (REC) System where the grid-connected green

energy generators can trade these certicates with Distribution companies (Discoms) of the States which do not have

adequate renewable energy potential to comply with Renewable Purchase Obligation (RPO), which stipulates the minimumquantum of green energy to be bought by them annually (Source: The Hindu, 23 March 2012).

38 MOUs with expected investments of US$ 8.83 billion (INR 44,152 crore ) signedduring GIM 2010: The Government is

envisaging more investments in the power sector.

Consistent growth in the installed capacity of the power plants.

Policy levelinitiatives by the State to provide investor friendly environment.

Major focus on renewable energy.

Huge outlays by the government to boost the Sector.

GAIL to lay 1,370 Km of gas pipeline through Dabhol-Belgaum-Bangalore at an investment of US$ 153 million (INR 765 crores)

Approval given to Shree Renuka Infra projects for a thermal power plant with an investment of US$ 1.1 billion (INR 5,500 crore).

Approval by Karnataka Government for 700 MWLNG power plant in Bangalore for an investment of US$ 740 million

(INR 3,700 crore)



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Policy Initiatives: A snap shot

Karnataka Renewable Energy Policy 2009-14

Karnataka Solar Policy2011-16

Emphasis on Energy Conservation and Energy Efciency by a saving of 1,500 MU per year (900 MW by 2014)

Sublease the developed lands to the Renewable Energy developers for a period of 30 years and renewed for a period of 5 years

at a time after the lease period subject to fulllment of conditions stipulated by the Government

Government will assign the Power Purchase Agreements to the ESCOMs at the time of allotment

Akshaya Shakthi Nidhi (Green Energy Fund): In order to facilitate Renewable Energy project nancing and Energy Conservation

and Efciency measures Green Energy Fund Akshaya Shakthi Nidhi will be established. Green Energy Cess of INR 0.05 (ve

paise) per unit would be levied on the electricity supplied to commercial and industrial consumers.

Land Policy for Renewable Energy Projects: The availability of suitable land and making the land available expeditiously is a

major issue for RE development

Renewable Energy Special Economic Zone (SEZ) (under Industrial Policy 2009): 10% portion of the lands to be at the disposal of

KREDL to develop Renewable Energy projects and allied Renewable Energy industries (in proposed and future SEZs)

Sugar and co-gen, power development: Bidar, Belgaum, Bagalkot, Shimoga and Mandya Districts

Power Generation sector specic industrial zone development: Raichur, Bellary, and Bijapur & Chitradurga Districts

SEZs at Shimoga, Hassan, Bangalore, Udupi, Mysore and Bellary.

Clearance of Renewable Energy projects: The concerned department will give necessary approval and clearance within 90 days

of the application submitted. KREDL will monitor with the concerned departments

Regulatory Issues:

wheeling charges @ 5 %will be applicable subject to the KERC norms

Grant of Incentives Available to Industries as per Industrial Policy 2009

Maximum of 200 MW by 2016 for ESCOMs and Captive Power Plants and those put up for sale of power to third party

(not to ESCOMs) do not form part of the target of 200 MW

Purchase Obligation: Quantum of power that is to be procured by ESCOMs from solar resources will be 0.25% of the

total consumption.



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M & A Scenario in Energy

Sector in India

M &A data of India - Top 10 Indian deals (2011) in Energy Sector

TransactionValue (US$

million)Target Name

Target Nation Acquirer AcquirerCountry

Stake (%)

9,000.00Reliance Industries Ltd-21 Oil & Gas

BlocksIndia BP PLC United States 30.00

310.56Luminous Power Technologies(P) Ltd

India Schneider Electric SA France-

206.33 KSK Energy Ventures Ltd India investor GroupMauritius

20.00

150.00 Diligent Power Pvt Ltd IndiaWarburg Pincus India

Pvt Ltd

United States25.00

150.00 Gemmia Worldwide SA British VirginRam Kaashyap

Investment Ltd

India -

120.00Avantha Power & Infrastructure Ltd

IndiaKohlberg Kravis

Roberts & Co LPUnited States

11.00

113.19Visa Power Ltd

IndiaBlackstone Group LP United

Kingdom-

78.50Caparo Energy (India) Ltd

IndiaIndia Infrastructure

FundIndia -

67.61SPS Ispat & Power Ltd

IndiaAthena Capital

Partners LLP

United

Kingdom30.00

45.00 Undisclosed Oil & Gas Co IndiaStealth Ventures Ltd

Canada -

The top 10 Indian Deals in the energy sector contribute to about 97% of the total value of all the deals

Cumulative FDI inflows into Energy Sector (Period: April 2000 to January 2012)

Sector INR crore US$ millionPercentage to

overall FDI

Power 32,798 7,215 5%

Petroleum and Natural Gas 14,612 3,339 2%

Total 47,410 10,554 7%

Overall Karnataka (in all sectors) 42,434 9,468 6%

Source: Department of Industrial Policy & Promotion, Ministry of Commerce & Industry, Government of India

The FDIs in Energy and Gas Sectors do not show any specic trend. The investments petroleum and natural gas are

dependent on the linkages to the gas sources.



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Investment Opportuniies

Power Generation (KPCL) Construction of LNG-Terminal at Tadadi (Coastal Karnataka) through PPP.

Connecting gas pipeline b/w Tadadi LNG Terminal and GAIL Pipeline at Haveri near NH-4.

Hydro Power Plants based on Pumped Storage basis on Krishna river basin (in conjunction with Water Resource Department)

Renewable Energy (KREDL) The development of Solar park for facilitating evacuation of power and providing land to Solar Power Developers.

The Equipment manufacturing parks for facilitating Solar Power Proponents

Distribution (BESCOM/ESCOMs) Identication of Towns for adopting Franchise Model to reduce AT&C losses in high loss areas.

Identication of Towns/Locations in Urban areas for adopting Franchise Model in billing collection effecting prot sharemechanism.

Identication of Towns for adopting Franchise Model for implementation of High Voltage Distribution System.

Development of smart grid in Bangalore.

Development of IT initiatives in addition to initiatives under Accelerated Power Development and Reform Program.

Generation: Other Sources (PCKL) 1,000 MW Solar power plant (multiple locations/ in a single location of minimum 50 MW in each location)

Sourcing of Gas/R-LNG for 71.32 MMSCMD

Firm Capacity (MW) Gas Requirement (MMSCMD)

KPCL 2,800 12.8

PCKL 2,800 12.8

IPPs 10,670 45.72

Grand Total 16,270 71.32

Development of Gas based Power Project in Tumkur under Merchant Power Plant route.

Encouraging the Private Sector to set up Distributed Generation of 75 MW-100 MW Coal based under Merchant Power Plant

route by facilitating/obtaining water from the sewage treatment plants in Tier-II Towns.

Power Equipment manufacturing Parks (Boiler Turbine Generators, Steam turbine, etc.)

Transmission (KPTCL) Up-gradation of Transmission Network through PPP

Expansion of Transmission Network through Joint Venture (JV) route.

Others Development of R & D Centers

Universities and educational institutions in energy secto



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Shelf of Projects

S no Project District

Thermal Energy (Concerned Authority: PCKL)

1Merchant Power Plants, along the GAIL Pipeline

Corridor

Multi-district

2Gas based 700MW power plant (Gas Requirement

3.2 MMSCMD) at Belgaum, Gadag, and DavangereMulti-district

WindEnergy Plants (Concerned Authority: KREDL)

3 Kappadagudda Extension Gadag

4 Hill ranges of Guledagudda Gudur Bagalkot

5Hill ranges of Sureban,Yere Kittur, Kallur, Mallur and

BasidoniBelgaum

6Hill ranges of Halolli to Katkol (Godachi, Khanpet,

Torgal)Belgaum

7Hill ranges of Halagatti, Mudakavi, Tadasi, Vasan,

GovinakoppaBagalkot

8 Hill ranges of Soudatti to Ugargol Belgaum

9 Hill ranges of Hanumana Hatti to Kakti Belgaum

10 Zalki of Indi Taluk Bijapur

Solar Power Plants( Concerned Authority: KREDL)

11

Across 20 locations in Bidar, Gulbaraga, Bijapur,

Bagalkot , Tumkur, Kolar, Chitradurga, Davangere, etc

districts

Multi-district

Distribution (Concerned Authority: All ESCOMs)

12 Third Party Revenue Collection for all ESCOMs Multi-district

13Franchise Model for implementation of High Voltage

Distribution System all ESCOMsMulti-district



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Principal Secretary to Government of Karnataka

Commerce & Industries Department# 106, 1st Floor, Vikasa Soudha, Dr. Ambedkar Vedhi, Bangalore - 560 001, India.

Ph.: +91-80-22252443 / 22034340 Fax:+91-80-22259870 Email: [email protected]

Commissioner for Industrial Development and

Director of Industries & Commerce2nd Floor, Khanija Bhavan, No.49, Race Course Road, Bangalore - 560 001, India. Ph.: +91-80-22386796 Fax: +91-80-22389909 Email: [email protected] Visit us at: www.karnataka.industry.gov.in

Managing Director, Karnataka Udyog Mitra3rd Floor, Khanija Bhavan (East Wing), No.49, Race Course Road, Bangalore - 560 001, India.

Ph.: +91-80-2228 2392, 2228 5659, 2238 1232, 2228 6632 Fax: +91-80-2226 6063 Email: [email protected] Visit us at: www.kumbangalore.com

Principal Secretary to Government of KarnatakaEnergy Department

Room No. 236, 2nd Floor, Vikasa Soudha, Dr. Ambedkar Veedhi, Bangalore 560 001, India. Email: [email protected] Visit us at: www.gokenergy.gov.in

Managing Director

Power Company of Karnataka Limited,

Kaveri Bhavan,Bangalore-560 009, India. Email: [email protected] Visit us at: www.pckl.co.in

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