IPCL

Growing focus on solar

India Power Corporation Limited (IPCL) was incorporated in 1919 as a utility and power generation company. Over the years it has been growing its renewable energy portfolio and today has 143.2 MW of renewable capacity spread across Gujarat, Rajasthan, Karnataka, Maharashtra, West Bengal and Uttarakhand. As of March 2017, renewable energy accounted for 8.9 per cent of the company’s total power generation portfolio of 1,600 MW. In addition, it has a Category 3 state trading licence that allows it to trade up to 628 MUs of electricity per year across the country.

IPCL is one of the oldest discoms in eastern India and has a distribution licence for Asansol, West Bengal, and a distribution franchise in Gaya, Bihar. Its total distribution area spans 2,000 square km and it serves close to 0.25 million consumers. The company has been vigorously trying to reduce its transmission and distribution losses in its service areas. In Asansol, it was able to reduce losses to 3 per cent (in March 2017) from 5 per cent (at the time of takeover) by improving its network and implementing 100 per cent automatic meter reading, prepaid metering and a SAP system. The company claims grid reliability in the region to be 99.99 per cent, which is one of the highest in the country. In Gaya, IPCL claims to have increased power supply to 23 hours (as of March 2017) from 11 hours (at takeover) and reduced transmission and distribution losses to 49 per cent from 68 per cent during the same period.

Green initiatives

On December 30, 2015, IPCL incorporated a wholly owned subsidiary, India Power Green Utility Private Limited, with the objective of developing and acquiring renewable energy assets. Wind energy accounts for the majority of the company’s renewable portfolio, with an installed wind power capacity of 105.2 MW. Of this, the highest installed capacity is located in Jaisalmer district of Rajasthan, with two projects having a combined capacity of about 60 MW.

Till 2013, the company mostly focused on the development of wind power projects, except a 2 MW solar power plant at Seebpore, West Bengal, which was set up in 2008. This also happens to be the first grid-connected solar plant to cross the megawatt threshold in the country. However, no renewable power plants were commissioned after 2013, until 2016. In March 2017, IPCL commissioned three solar power plants of 12 MW each in Uttarakhand. All three were installed by Punj Lloyd.

Notable partnerships

In order to achieve better efficiencies, IPCL has entered into several joint ventures and partnerships. Some of the key deals are highlighted below:

  • In February 2017, India Power Green Utility Private Limited partnered with Punj Lloyd Infrastructure Limited to co-develop 36 MW of solar assets, with an investment of Rs 2,250 million in Uttarakhand for special purpose vehicles. The projects have already been commissioned and the Uttarakhand Power Corporation has signed a 25-year power purchase agreement (PPA).
  • IPCL has partnered with the United States Trade and Development Agency, which will provide funds to implement smart grid technology across the company’s distribution network, especially in Gaya.
  • IPCL has a 50:50 joint venture (JV) with India Uniper Power Services Private Limited. The JV was formed to improve IPCL’s thermal power plant fleet’s operational efficiency and flexibility. The services offered by this JV will be power plant operations and maintenance, asset monitoring, and so on.
  • In early 2016, IPCL entered into an agreement with ENGIE, a French multinational electric utility company, to acquire shares of Meenakshi Energy Limited (MEL) in Nellore, Andhra Pradesh. MEL is a coal-fired power plant with a functional capacity of 300 MW and 700 MW of capacity under construction.

Outlook

The company, which registered a gross revenue of Rs 7,266.8 million in 2016-17, had a compound annual growth rate of 1.97 per cent over five years. For its distribution network, it plans to reduce its losses further and increase efficiency, especially in Gaya, where it has set a target of reducing losses from 49 per cent to 15 per cent in the coming years. On the generation front, the company expects to add 500 MW of capacity by end-2017, although almost all of this capacity will come from coal-based generation.

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