Revolutionizing India’s smart grids with IT

BANGALORE, INDIA: As India aggressively progresses on the road to strengthening its position as an emerging economy, its power demands have been rising phenomenally. While it struggles to make up for the existing deficit of about 10 per cent, India also faces the challenge of providing access to electricity to over 400 million people.

Understanding the power situation

To meet the dramatic rate of increase in electricity deficit, the country requires massive investments in infrastructure. Simultaneously, we must fix the holes that are responsible for electricity leakages at various levels. The Indian power sector makes technical and commercial losses to the tune of 28 per cent of the total electricity produced.) This is now a social and economic development imperative.

The annual report 2009-2010 of the Central Electricity Authority, Ministry of Power, Govt. of India indicates that India has an installed power generation capacity 169,749 mega watts as of December 31, 2010. Additionally, there is a substantial amount of captive production capacity amounting to around 15,000 mega watts in the industrial sector, according to official data The country generated a total of 746 million mega watts in FY 2009-2010 to meet the demand of 831 million mega watts; and this power is distributed across the country through five regional grids, 31 state grids and over 100 area-wise grids.

Finding the ‘right' answer

Ideally, the first step should be to strengthen and smarten the current electricity system. The best way to do it would be by building new lines, substations and power plants. However, considering the hyper demand for electricity, coupled with the huge technical and commercial loss that the sector makes, superior grid reliability is more than mandatory. To achieve this, the system should be fortified with intelligence by integrating it with information and communication technology solutions (ICT) solutions to plug leakages and improve efficiencies.

A smart electricity grid in place will open avenues for new applications that will have far-reaching impact. But what is a smart grid? A smart grid is the integration of information and communications technology into electric transmission and distribution networks. The smart grid delivers electricity to consumers end usage of electricity. Also, to enable efficient use of the grid by identifying and correcting supply-demand imbalances instantaneously, thereby reducing costs and improving reliability and quality of service .

Technically, the smart grid involves and improves every stage of the electricity cycle, from utilities through electricity markets to applications. The emerging vision of the grid, therefore, encompasses a broad set of applications, including software, hardware, and technologies that enable utilities to integrate, interface with, and smartly control innovations.

Is smart grid the desired solution?

It does seem like it. Power utilities around the world are adopting smart grid technologies to make power infrastructure robust, adaptive and cost effective. India, too, decided to take a giant leap with its smart grid initiative, given the limited legacy systems and the huge potential for growth in the sector. The implementation of smart ensures enormous opportunity to capture information about supply, system demand, individual usage, and pricing, which will in a big way shift how electricity is utilized in our country.

According to the IEEE Standards Association (IEEE-SA), the standards development body of the Institute of Electrical and Electronics Engineers, India will soon emerge as the world's third largest smart grid market after the United States and China.

Keeping the industry's potential and limitations in view, India's smart grid policy is being jointly developed by a collaborative group of central and state government bodies and subject-matter experts from non-government research and development organizations, and the industry and academia. India's smart grid vision is primarily based on five fundamental objectives:

End of load shedding: Peak load shifting through a combination of direct control and differential pricing

Reliable power: Robust systems with self-healing capabilities through monitoring

Cheaper power: Dramatic improvement in aggregate technical and commercial losses and real-time monitoring of load sources

Shifting the peak away from costly power: Better utilization of assets

More sustainable power: Integration of green and renewable resources at a massive scale to increase energy independence

For the systemic growth of smart grid in the country, India Smart Grid Forum and India Smart Grid Task Force have been set up under the aegis of the Ministry of Power. India Smart Grid Forum is a non-profit voluntary consortium of public and private stakeholders with the prime objective of accelerating development of smart grid technologies in the power sector. And India Smart Grid Task Force is an inter-ministerial group that will serve as the government's focal point for activities related to the country's smart grid initiative.

Smart Grids Can Get Smarter with Technology

The power industry recognizes the fact that the success of the smart grid initiative is based on the most targeted and optimum use of technology. Adoption of technology in the power sector has enabled it to grow by optimizing energy of resources and helping it boost productivity in every sphere of business. Backed by technology, the industry is now keen to deliver newer efficiencies in business processes, customer relationships and partnerships with the help of technology.

Technology companies with extensive experience in serving governments across the world and comprehensive software suites and services, therefore, play an instrumental role in making India's smart grid initiative a success. Such companies work in tandem with the government and are committed towards enabling the power industry to become self-sustainable, collaborative and energy efficient. They can offer customized solutions to help utilities master business processes along the entire asset-centric and customer-centric value chain and across segments (including electricity, gas, and water). Utilities that adopt IT-integrated solutions for their entire value chain achieve many benefits.

Enterprise-wide visibility to manage innovation, risk, and costs

Efficiency and automation of core billing and settlement processes

Effective enterprise asset management

Adaptability to new market models

Loyal and profitable customer relations

Increased operational safety, security, and regulatory compliance

Mitigated risk deploying an enterprise business solution

For instance, the government-led Restructured Accelerated Power Development and Reforms Program (R-APDRP) launched in 2010 started a new wave of positive change in the power sector. The program focuses on actual, demonstrable performance in terms of sustained loss reduction. The contribution of technology companies has been crucial in the success of this initiative, and understandably so. Technology companies have been instrumental in establishing reliable and automated systems for sustained collection of accurate base line data and also in the adoption of information technology in the areas of energy accounting. For the government, it was essential that it build such efficiencies before it took up regular distribution strengthening projects.

Way ahead with IT

In the foreseeable future, increased investment in technologies and tools across the energy value chain to improve energy and operational efficiency will be a big game changer. A sustained emphasis will be on improving the current systems and business processes such as billing and collections, enterprise resource planning, metering and infrastructure and grievance handling and services. Improved efforts to reduce cost will drive changes in business processes, IT functionality requirements and IT spending.

Regulators will also significantly influence utilities and will pursue greater disclosure and stricter compliance. Mostly, regulatory forces will be in the areas of reliability, unbundling of distribution and ultra mega generation projects, distribution open access and policy changes. Utilities can look for ways to service customers in a more cost-effective manner. With changing customer needs and purchase behaviors, utilities would definitely prefer to offer more rate choices. IT investment is expected to increase in areas such as dynamic pricing, advanced metering system, outage management, customer relationship management, and analytics and meter-to-cash solutions.

The author is vice president, Strategic Industries, SAP India