IX Plan Scenario (1997-2002)
X Plan Scenario (2002-2007)
XI Plan Scenario (2007-2012)
General to all Plans

Electric power is a vital infrastructure for the development of energy be it in the agricultural sector or the industrial sector. Recognising this fact & realising no significant development of this sector in pre-independence era, Power Sector development was conceived under Public Sector under Electricity (Supply) Act, 1948. The State Government has been making substantial allocations ranging from 22.8% to 34.40% of the State's annual plan to the Power Sector. This has lead to all round development of the sector in the State, as indicated below:-

Break up :

Generation - 2745.51
EHV Transmission - 1303.53
Sub-Transmission & Distribution - 989.74
Rural Electrification - 1129.94

Electric power net work has also grown from Isolated Power Stations at the time of independence to fully integrated system in each of the 5 regions of the country with power exchange taking place between the regions on HVDC links giving as emblance of a National grid.

This development is inadequate to meet growing demand. In spite of special allocation of 694 MW as on 31.3.1998 from Central Sector Power Stations (including diversion of U.P.’s Share) & purchase/overdraw of 750 MW, State is facing Power shortage. Due to restricted availability of power, severe cuts and restrictions had to be imposed during peak hours and 7 hours supply is made to Agricultural sector besides unscheduled load shedding. CEA has recently carried out load survey, known as XV Electric Power Survey in which Demand & Energy requirement has been projected up to 2000-01 and beyond. Accordingly, Rajasthan will have unrestricted maximum demand & Energy requirement as under. Actual figures of restricted demand and energy requirement for 1996-97& 1997-98 are given in bracket.

The Electrical Industry is a capital Intensive Industry & establishing additional generation, Transmission & Distribution facility to meet growing demand is now beyond the resources which a State can provide without jeopardizing other important sector of development, e.g. Irrigation, Medical & Health, Education & Social welfare etc. In consideration to the resource crunch, private sector participation in Power sector, especially generation was formulated by the Union Government. Accordingly requisite legislative changes were made and Guide lines of normative parameters and tariff determinations issued in 1990 . Rajasthan State had conceived Private Sector participation much earlier by issuing licensee to M/s. CTIL to establish 500 MW Thermal Plant at Chittorgarh. However, following the GOI policy, State Govt. decided not to undertake any new power plant in State Sector and had invited International Competitive bidding for coal, Lignite, liquid fuel, Solar and wind energy based power projects. Letter of Intents have been given for 5628.70 MW & PPAs have been signed for 3948.70 MW Power Plants. The negotiations on price bids & PPAs are underway for another 1680 MW Power Plants.

The Scope for private Sector participation is being further widened by GOI, through legislative measures to include transmission & Distribution of Electricity.

The state had also initiated reform of power sector. The State Govt. in its power sector reform policy statement has resolved to reform its power sector with the objective of creating enabling conditions for sustainable development of its power industry and improving efficiency and quality of electricity services in the State.

After Power Sector Reforms, effected through proposed Rajasthan Power Sector Reform Bill 1997, the role and operational relationships of the various entities connected with Power Sector would be as follows :

1. Regulatory Commission will regulate bulk and retail tariffs and issue and enforce licenses.

2. RSEB will be corporatized as a new company (RSEC) which will be operated commercially and be eventually positioned to issue and list shares in the market. The new company will be a bulk purchaser and transmission company. Kota thermal plant will remain integrated with the new company as a separate profit centre.

3. Distribution functions will be progressively privatised for which licenses will be issued by the Government / Commission. Licensees will purchase power from corporate successor of RSEB. State Government is considering to privatize all distribution zones in the state by year 2002. As a first step, two areas, one consisting of Alwar, Bharatpur, Dholpur, Sawai Madhopur and Tonk districts and other consisting of Jodhpur, Pali, Sirohi, Jalore, Barmer and Jaisalmer districts considered for privatisation through joint ventures with the private bidders having 51% or more of the equity participation.

4. Independent Private Producers to sell power to corporate successor of RSEB as per their Power Purchase Agreements (PPA).

The Power Sector is presently at the threshold of an important evolutionary change, which when full accomplished will alter investment scenario from entire dependence on State & Public Sector / financial institutions financing to a public / private sector distancing from the Govt., accessing capital market and also generating Internal resources. Scenario will change from the single State monopoly to a sector with multiple operators guided by market forces, efficiency and quality of service. With changing scenario, past indicators of investment and developments will not be relevant.

IX Plan Scenario :Year 1997-2002

In the field of power generation, presently only Suratgarh Thermal Station Stage-I, is under execution in State Sector, its first Unit is likely to be commissioned by Dec., 1997 & next Unit by June 1999. Plan outlay in 'generation' will taper off from 2000 and more resources will be available for Transmission system (including evacuation system for Private Sector Power Stations) & distribution system. In the execution of transmission and distribution lines, the priority in following order has been considered.

1. On going scheme,

2. Transmission schemes primarily meant for evacuation of power from Independent Power Producers.

3. Schemes meant for PHED, Lift irrigation & Industrial loads.

4. Scheme meant for reducing T & D loses to a level of 20%

5. Schemes to meet growing load demand.

Above outlay does not include investment for 140 MW Solar hybrid power plant (Rs.980 Crores) & Kota Unit VI (Rs.760 Crores) to be financed almost by the external assistance. The State's contribution to solar power plant would be the equity of Rs.50 Crores.

Compared to VIII Plan, IX Plan will have lesser dependence on State's resources. Scenario is likely to be as under :-

As stated above, two distribution areas may be transferred to joint venture companies with Private Sector. However, initially (for say five years) we will have to have policy of uniform retail tariff throughout the state irrespective of whether distribution system is in state or private sector. Some EHV transmission may be Built, Owned and Maintained by the Private Sector with their operations with RSEC. However, their contribution will be insignificant.

Compared to urban sector, rural sector will be less lucrative to private licensee. To reduce population & industrialization pressure on Urban areas, which may give rise to health, sanitation, drinking water & other problems, quality of electricity services in rural area, as a policy, will have to be improved & brought at the level of that in urban areas. Scheme of Incentive/dis-incentive and regulatory measures will have to be evolved to achieve their objectives.

With population growth, drinking water may become scarce and on agriculture front more & more areas may be under dark zone. Though power sector will be able to meet increasing load of lift irrigation & drinking water schemes, yet it will be appropriate to formulate a water conservation policy including irrigational /crop technique requiring lesser water or feasible with waste water recycling.

Though by the end of IX Plan, the Scenario of self sufficiency in power will emerge, but by then we would be fully exploiting the known lignite & Natural gas reserves in Rajasthan, and could have established Thermal Plants as per availability of Water from IGNP or at sites along Chambal river (not in environmentally sensitive area). The scenario for generation by 2001-02 is likely to be as under:-

X Plan Scenario (Year 2002-07)

By the end of IX Plan, village electrification will reach 38247 Villages (including 250 villages of REDA) against total villages of 39180. By then, sub-transmission & Distribution system is likely to be transferred from Rajasthan State Electricity Board (or Rajasthan State Electricity Corporation) to licenses in Private Sector or Joint venture Distribution Companies and Rajasthan Electricity Regulatory Commission would be determining the tariff for supply of electricity by licenses/RSEC as well as their performance parameters in respect of quality of services & efficiency norms. The role of RSEC will be mainly limited to a transmission facilitators, transmitting & regulating the power supply from various generating stations / sources to licensees/Bulk consumers. Existing and envisaged PPAs between RSEB and Independent Power Producers (in private sector), will get assigned to the licensees/bulk consumers. State’s role will then be of promotional nature, mainly, in the development of Hydro & Solar energy and providing direct subsidies (capital or otherwise) for electricity supply to socio-economically weaker sections, tribals, small farmers etc. Appropriate, self sustaining mechanism of electricity duty, generation / sales tax (on ex-bus power supply) etc. would have to be devised so that these does not become burden on State.

Greater emphasis will be laid in this plan on transmission, sub-transmission & distribution thereby improving system reliability, supply at proper voltage & with least interruptions etc. In the years to come, Industrial growth would be high. New industrial load centers would come up necessitating new 400 KV, 132 KV & 33 KV transmission system, Drinking water, Lift Irrigation Load growth would be served thereby eliminating / reducing drinking water & irrigation problem.

In Rajasthan Jaipur & Jodhpur cites may come under metrocity category during Xth plan period. The other city like Kota, Ajmer, Udaipur, Alwar may also develop accordingly due to population growth. This will raise the problem of public transport. The system will have also to take care of these along with railway electrification load growth. L.T. Less system will pick up in cities and rural areas.

During Xth Plan, investment in EHV Transmission of RSEC is likely to be Rs.1500 Crores. In this plan, distribution system may be privatised either fully or as a joint venture with RSEC. However, initially (for say five years) we will have to have policy of uniform retail tariff throughout the state irrespective of whether distribution system is in state or private sector. Trends of transmission system owned and maintained by it but controlled/operated by RSEC may be more visible.

Rajasthan has meagre sources for conventional energy generation. The lignite and gas reserves will all get earmarked for Private Sector Projects in IXth plan. The hydro potential on river Chambal and Mahi may only remain be exploited in Private Sector, but when exploited their contribution will be mainly to meet peak demand. The State will have to depend on its share from Power Station established outside the State. Investment on Rural Electrification may be small because of almost 100% electrification. Private Sector Investment in Generation will be mostly outside the State. Investment in distribution is envisaged at about 70% of that by the end of IXth plan (based on growth of 8% per annum) i.e. about 47.0% in five years to meet growing demand and about half of it (i.e. 23%) for System Augmentation to reduce T&D losses. Reduction in T&D losses, quality improvement and efficiency mechanism to enforce these through RERC or through legislation will have to be evolved so that this desired objective is achieved. Retail tariff variation within narrow band consistent with quality and efficiency may emerge out in this plan.

Xth Plan Investment : at present price

A. Generation :

• Within State Rs. 6000 Crores (Private Sector)
  (for 2600 MW addition with 50% gestation period in IXth Plan)
• Outside the State Rs.6600 Crores (Rs.600 Crores for Parvati HE (private and CEPA) S&I + likely equity contribution in State Sector).

B. (a) EHV Transmission Rs.1500 Crores (State Sector)
(b) -do- CEPA Evacuation Rs.1700 Crores (Private Sector/Powergrid)

C. Sub-transmission Rs.2300 Crores (Private Sector) Distribution

D. Investment by the end of out of which State Sector

IXth plan in RE, ST and outlay will be Rs.2100 Crores distribution Rs.2180 Crores plus Rs.2205 Crores.

During this plan, with improvement in quality and efficiency, consumer's acceptance of differential retail tariff may emerge out and policy of retail tariff within a narrow band may have to be given up.

XIth Plan Scenario : Year 2007-2012

The technological improvement coupled with increasing dependence on costly power purchases from outside the State Power Station may make solar energy power stations to be competitive with conventional ones with little Govt's promotional support by the end of Xth plan. With vast Desert stretch in Rajasthan, it may not be necessary to go for mega solar energy projects but small projects meeting the need of a village (or cluster of villages) and also exporting a part (say 50%) to neighbouring area may be more appropriate as it will not require any investment on transmission system and will enable least cost of transmission of power and minimum transmission losses. A part of energy need may also be met by other non-conventional sources of energy eg. anaerobic fermentation of cow dung (Gobar gas) or sewage. A well laid down policy, which may promote such small power plants of non-conventional energy sources may be necessary in the form of grants to University or research organizations and also as concessions in taxes etc. to entrepreneurs.

Beyond Xth Plan, scenario may be of rate of investment lower than growth rate due to energy conservation & decentralised small plants etc. Investment may be about 80% of growth rate of 8% per annum (i.e. 6.4% p.a. i.e. total 36.4%) Investment pattern may be :-

General for All Plans

In order that power sector is not unduly taxed and thereby tariffs are made unbearable to consumers at large, it would be desirable to lay policy of a specified ceiling for the local taxes (i.e. octroi) or State Taxes or Water/Pollution Cess etc. on inputs (e.g. coal, gas, lignite, water etc.)

Power development generates employment but power sector in itself is not a potential employment generator. This Sector presently employees 67780 personnel (vide Budget Estimates for 1997-98). With private sector participation, man power employed per MW may get reduced. In order; that this may not give rise to socio-economic problems, it would be appropriate to earmark a portion of State's resources, saved due to private sector advent in Power Sector, for self employment generation schemes.

Policy of promoting sub-license in smaller areas, need be the part of regulator’s policy.