Power to Unlock

There are significant pointers available to the policy makers in the phenomenal success of the PGCIL IPO, both at the state and central levels.

First and foremost, it is important to establish through policies, regulations and the administrative machinery, a viable business model. When established systems are unbundled or restructured, it is necessary to keep in mind the possible future options and decide on the policy frame work.

The second important pointer is that of the organisational culture and capabilities of the public sector entity, to benefit from the enabling environment. PGCIL through its employees, have established a bench mark in performance, which is comparable to its peers abroad.

Market is also rating the NTPC Scrip (another major player in the Power sector) with lots of expectations. NTPC has also benefited from similar policy initiatives and is a well manged and run organisation with committed employees. All these augurs well for the sector as a whole. The prevailing sentiment should be capitalised to bring in part of the enormous funds required to make power for all by 2012.

Forward looking state governments should be encouraged to corporatise packets of distribution network, along with or as a separate entity the transmission systems and approach the market for equity. Every state through the Electricity act have put in place a regulator who is guiding the policy issues. In the case of Tamilnadu for instance, aggregate commercial losses on a grossed basis may look marginally higher compared to what the market would like to see. But one can look at significant pockets(geographical areas) which can be spun off into separate companies and corporatised.

Tamilnadu should take the lead to bring in the much needed funds to improve the balance network with out loosing government's control.

Indian Governments need to be more proactive

Choke Eases Even More

RBI has done its bit to unshackle the Indian Entrepreneur and industrialists from the chains of bondage to the Indian currency. The Investors are, by the day being encouraged to, explore new markets, compete globally to maximise returns on their capital.

It is now the turn of the Government to step in an unobtrusive way to support the initiative. In this era of globalisation, we need to ensure energy security, and committed linkages to commodities that help us meet our growing needs. This is best done through selective investments, which also translate to export of our capital globally. All these can be front ended by the nibble footed Indian investor, but he surely needs the unfailing commitment of the government.

We need politicians who will understand the dynamics of the Indian multinationals' support requirements and guide the policies. They should intervene to nudge friendly governments to grant a license or exclusivity. They should also provide the bureaucratic support to secure favourable terms for our capital such as Sovereign government guarantees, negotiate hard during bilateral exchanges with the Indian investors capital in mind.

Bulk of our increasing foreign exchange reserves are due to the earnings of Indian diaspora who are toiling away to bring in the riches to the country. It would befit all their efforts if the governments and Indian Entrepreneurs use this capital to further enhance the Indian growth story.

Wired Broad band in India

Wired broad band is one of the most cost effective of building the backbone to deliver high speed connectivity to Tier II, Tier III cities and rural India. While providing "Open Access" on the existing fiber and copper is one of the best ways there are other interesting possibilities as well waiting to be exploited.

And that is the Optic Fiber run on Transmission Lines. Composite Optic Power Ground wire, which is run on existing Transmission Lines serve two distinct purposes. It acts as earth wire for the Line(shielding) and also provide Optic fiber (up to 24 fibers as a standard).

With the Electrical utilities, already having a ready made "Right of Way" , these Optic Fibers which are run on thees lines with the end equipments housed in various stations provide the opportunity to take Fiber along all the main state trunk routes. It also saves enormous costs for the utilities who are increasingly going on for Automation of billing, etc for which they are currently hiring broad band from ISPs.

With the enormous reach of the Electrical utility in the state and their established mechanism to provide O&M services, the Optic fiber once laid will provide additional revenue streams. It is also easy to break the fiber at intermediate Substations and add signals, This facilitates additions of intermediate stations which are other wise unattractive locations from the revenue point of view of Service Providers. One can also look at the possibility of leasing out space for the Mobile operators in the substations, along with back bone connectivity to provide wireless signals for the last mile.

For the utilities this provide a new stream of revenue and the government a cost effective solution.

Once the Optic fiber is in place connected, the Government can lease some of the fibers for its educational services, Telemedicine and e Governance. The surplus fiber can be either leased out as "Dark Fiber " or the utility can provide bandwidth as well.

TRAI shall take the decision to provide "Automatic" state level Service Provider's Licence to the Electric public utility as a starter.

PGCIL has already laid the fiber and is generating revenues. Some of the forward looking electricity boards are already working on it and has commenced the work. The time is right to take a decisive move on this initiative.

Olympic Myths

Olympic Myths

An interesting locals perspective on the Olympics has been presented in this article. While I agree with the views presented, it would do us all lots of good if we look at a possible solution as well for this "distortion" to ordinary lives and permanent alterations(damage!) to the locale.

Given the proven business model of Olympics, any progressive thinker like you (Mike) should propose an alteration to the model so that part of the business model stays. Any effort to totally alter the scheme will bring with it the enormous clout of the forces that stand to benefit from this once a 4 year show.

Some of my suggestion are:

1. Leverage technology: With the enormous capability of technology one can synchronize multiple locational events and present a coherent continuous spectacle to the Television audience which is the key funder of such extravagance.
   
2. Allow to bid for hosting specialized events only instead of the entire games. Such an effort will make it easier for new comers to look at creating a part of the facility and not burden itself with the issues of hosting the entire paraphernalia of the Olympic teams. It will drastically reduce the logistics effort required to move men and materials for the event, while bringing in more live(read physical) participation to encourage the sport and the participants.
3. Make use of the created facilities game after game. Such large facilities can be wasted away for a once in life time function. It has to be reused to conserve energy if not anything else. It also brings in enormous savings in costs of hosting subsequent Olympics.
4. Such an approach reduces the risk of security and partly saves the games from the efforts of evil minded eliminating the possibility of whole some interruption.

What would be the objections and who would be the objectors? Policy makers should think it out and act out the next steps.

Accounting for Power

Minimizing the human effort at the stage of collection and assimilation of consumption data through IT enabled environment will bring in the much needed transparencies and accountability to the Power Sector. Data accuracy will improve and so will the revenue. Efforts are needed to bring in this change across all levels of consumption.

Under the Accelerated Power Development and Reforms programme (APDRP) an effort to bring in energy accounting system was launched. This failed to take off, for the consumers did not see the benefit from this. The consumers were not educated on the likely benefits which accrue to them due to the possible reduction of commercial losses. A lesson is available for all, to therefore not repeat the same mistake when we grapple with new technologies and initiatives.

To bring in IT enabled accounting system, as your leader suggests, should be done with innovative tariff mechanism with inbuilt incentives for the consumer. A classic instance is that of the group accounting system. Each of our multi storied apartments has a dedicated transformer (if not more). Each of these transformers shall be metered and reconciled with the energy consumed as measured through the individual meter recordings to record the losses. Allowing for technical losses, the rest of the losses shall be recovered from all the consumers at a flat rate. This brings in a collective responsibility to the consumers in that apartment block as they see immediate benefit to themselves. The same model can be replicated across a commercial street where the losses could be substantial because of influential elements interests. Villages, with the promise of continued supply will also join the effort if for instance a scheme is drawn up where say for the "day and peak power" the villagers pay and the "night power" it is free.

Today technology (read IT) is available to make this whole effort automatic and with minimum human interface. Once the system is established the housing society's representative (or the local representative of the commercial street) can themselves tally and zero in on the reasons for losses. To start this entire exercise we need to prepare simple and easily understandable tariff models.

Today the tariff for say, TNEB is uniform across the state for identified slabs and has factored in it the aggregate commercial and technical losses as allowed by the Regulator. As and when we move to collective accountability system the new tariff called "Group Tariff" which shall not have any losses loaded in the base tariff (Losses as applicable for the appropriate voltage levels) but will have provision to load at actuals arrived at every reading.The recovery for the cost of providing this IT enabled environment should be spread over say a 5 year period, through BOT models for which I am sure we can find dedicated and competent firms.

One should put in special efforts to educate the consumer after launching such an incentivized scheme, so that popular will supports the implementation and minor vested interests are not allowed to derail the effort. Data generated through such dedicated IT enabled metering system could be used for planning, monitoring and establishing the performance of equipments and systems, so on & so forth.