The draft National Electricity Policy (NEP) which, under the Electricity Act 2003 is a guiding policy for planning power generation, supply and investment, has emphasised on increasing private participation, especially in power distribution in its latest revision.
NEP has also introduced power quality, micro grids, pump hydro storage, real time power markets in the draft policy statement as key focus areas.
NEP has noted that despite the Central government connecting 100 percent households in the country with the national power supply grid, quality of power and duration remains an issue.
The Union Budget 2021 announced a revamped reform scheme for discoms, entailing Rs 3.05 trillion expenditure. The scheme will put the onus on the states to formulate their own action plans and funds would be disbursed accordingly.
The draft has stated that public private partnership (PPP) in electricity distribution is one of the effective ways to improve efficiency, enhance consumer satisfaction and reduce financial losses of the discoms.
The draft has been floated in a public forum by the Ministry of Power for getting comments from stakeholders.
NEP has introduced several new concepts starting from the need of micro grids in remote areas to having a real time power market and need for investment in pump hydro generation.
With the rising capacity of renewable energy generation and lack of balancing sources of energy such as gas and large hydro, NEP has batted for realising the potential of pump hydro storage. NEP noted that the country has a potential of 96,524 MW of pump hydro storage and of that barely 4,785 MW has been put up.
For utilising power generation at the source end and reducing power supply wastage, NEP has suggested that power distribution companies (discoms) should explore the possibility of micro grids, especially in areas prone to natural disasters.
NEP has further stated that these micro grids should preferably be powered with renewable sources of energy.
