EMIS Insight - India Utilities Sector Report - 0

Utilities Sector
India
January 2014
Produced by:
Any redistribution of this information is strictly prohibited.

Copyright 2014 EMIS, all rights reserved.
-1-
Table of Contents
I. Utilities Overview
III. Power Generation - Overview
1. Utilities Highlights
2. Main Sector Indicators
3. Power Sector Snapshot
4. Power Sector Snapshot (contd)
5. Utilities as Percent of GDP
6. Wholesale Price Index (WPI)
7. FDI in Utilities
8. Power Sector Forecast
9. Electricity Utilisation, Consumption Forecast
10.Energy Requirement and Peak Load Forecast
11.Power Generation Forecasts
12.Water Supply Forecast
13.Employment and Salaries
1.
2.
3.
4.
5.
6.
IV.Power Generation By Type of Fuel

1. Coal
2. Coal (contd)
3. Legal Framework for IPP Projects in India
4. Competitive Bidding Policy
5. The Fuel Supply Agreement (FSA)
6. Gas and Liquid-Fuel-Based Generation
7. Gas and Liquid-Fuel-Based Generation (contd)
8. Hydropower Generation
9. Hydropower Generation (contd)
10.Nuclear Power
11.Nuclear Power (contd)
12.Renewable Energy
13.Share of RES in Power Generation, Capacity
14.Power Generation SWOT Analysis
II. Utilities Government Policy

1.
2.
3.
4.
5.
6.
Power Sector Government Policy

Power Sector Government Policy (contd)
Power Sector Government Policy (contd)
Renewable Energy Government Policy
Urban Water Supply Government Policy
LPG, PNG Government Policy

Power Sector Highlights

Power Generation, Electricity Demand
Installed Capacity and Capacity Additions in FY 2013
Capacity Utilisation and Per Capita Consumption
Energy Requirement/Availability Gap
Peak Load Demand/Supply Gap
-2-
Table of Contents
V. Power Transmission and Distribution
VIII.Major Players
1.
2.
3.
4.
5.
6.
Power Transmission and Distribution Highlights

Power Transmission and Distribution Highlights (contd)
Power Transmission and Distribution Highlights (contd)
Performance of State Power Utilities
Performance of Utilities Selling Directly to Consumers
(contd)
7. Power Exchange and Trading
8. Power Exchange and Trading (contd)
1. Top M&A Deals

2. Possible M&A Activity in Utilities
3. Liquidity and Solvency Ratios of Major Players
4. GAIL India Ltd.
5. GAIL India Ltd. (contd)
6. NHPC Ltd.
7. NHPC Ltd. (contd)
8. NTPC Ltd.
9. NTPC Ltd. (contd)
10.PowerGrid Corporation of India Ltd.
11.PowerGrid Corporation of India Ltd. (contd)
12.Tata Power Ltd.
13.Tata Power Ltd. (contd)
14.Tata Power Ltd. (contd)
VI.Water Supply and Sanitation (WSS)

1.
2.
3.
4.
5.

Water Utilities in India
Urban Water and Sewage Highlights
Water Supply
Water Supply and Sewage
IX.Appendix
VII.City Gas Distribution (CGD)
1. Table of Terms and Abbreviations

2. Ratio Calculation Formulas
1. City Gas Distribution (CGD) Highlights

2. PNG in India
3. CNG Sales, Stations and Vehicles

-3-
I. Utilities Overview

-4-
Utilities Highlights
Energy consumption
In 2011, India was the fourth-largest energy consumer in the world after the United States, China and Russia. The country currently accounts for
about 5% of the world's primary energy consumption and is forecast to claim 6% by 2025. Per capita energy consumption in Asia's third-largest
economy is among the lowest in the world, but is expected to be around the present levels of Japan by 2030.
Transmission
Four of India's five regional electricity grids are interconnected. Inter-regional transmission capacity totalled 28 GW in Mar 2012, accounting for
14% of generation capacity. While keeping its focus on adding generation capacity, the government has pledged to increase inter-regional
transmission to some 59 GW by 2015. State governments sell electricity to consumers at discounted rates and also grant capital subsidies to the
state utilities. Policies and electricity tariff rates are decided by the government. Issues to be addressed include unbundling, granting open access
to transmission and adopting loss reduction technologies.
Water Supply
Economic growth and urbanisation are widening the demand/supply gap of water and managing domestic water resources rationally and
sustainably is a national priority. Current water consumption is roughly in line with availability, but by 2030, water consumption is estimated to be
100% higher than water available. The uneven distribution of water resources, both geographically and seasonally, aggravate the problem. Less
than 50% of the urban population has access to piped water. Cities typically receive piped water for a few hours per day. Water utilities are run by
state, municipal or city authorities.
Natural Gas
With a share of 10%, natural gas is India's third most important energy source and is expected to grow to 20% of the energy basket by 2025. About a fifth
of natural gas demand is currently met by imports. In 2013, India had some 14,000 kilometres of gas pipelines, some 75% of which were operated by staterun gas utility GAIL. City gas distribution (piped natural gas or PNG) was available in some 50 geographical areas at the end of 2013.

-5-
Main Sector Indicators

Main Sector Indicators
Indicator
National GDP, (at constant prices, FY 2005 is base), INRbn
GDP growth (at constant prices, FY 2005 is base), %
Fiscal Deficit, INRbn
FY 2013
FY 2012
55,054.37
52,435.82
4.99%
6.21%
5,209.25
5,159.90
Performance Trend
10-Year History
8-Year History
FDI Inflows in Power, USDbn (calendar years)
3.83
(Jan-Jul 2013)
38.57
Plan-Wise History**
Installed Generation Capacity, GW*
223.34
199.88
Gross Electricity Generation, TWh
963.72
922.45
Transmission Lines Installed, ckt km
17,107
20,434
Per Capita Electricity Consumption, kWh
917.20
883.60
10-Year History
All-India Plant Load Factor (PLF) (Coal & Lignite), %
69.93%
73.47%
Energy Deficit, %
8.71%
8.50%
Peak Deficit, %
9.00%
10.60%
*Includes Renewable Energy Sources (RES)

**Planwise databars show data for years:
FY 1966 (End of 3rd Plan); FY 1974 (End of 4th Plan); FY 1979 (End of 5th Plan); FY 1985 (End of 6th Plan); FY 1990 (End of 7th Plan); FY 1997 (End of 8th Plan); FY 2002 ( End of 9th Plan); FY 2007 (End of 10th
Plan); FY 2012 (End of 11th Plan); FY 2013 (First Year of 12th Plan);
Source: CEIC, CEA

-6-
Power Sector Snapshot

Fossil Fuel Reserves of Key Countries, 2010
25%
498
308
Years of Reserves
10%
5%
1%
1%
1%
0%
Egypt
2%
33
Australia
2%
Natural Gas Demand Forecast
371
446
405
186
134
FY 2013
185
FY 2014
FY 2015
FY 2016
China
4,055
24%
U.S.
2,722
16%
India
980
6%
Russia
814
5%
Japan
597
4%
Demand from power generators outstrips domestic production of fossil

fuels (coal and gas). As a result, coal imports have been rising to support
the operation of plants not ordinarily functioning on imported coal.
Generation losses due to coal supply shortages have also been
increasing. Indias energy requirement is expected to grow four times the
current level to 2.0 BMT/year by 2031. To meet this demand, domestic
coal production has to grow between 7% and 9%. During the XII planning
period, thermal power plants are expected to require 842 MMT of coal,
against an estimated domestic availability of 604 MMT. The 238 MMT
shortfall is expected to be bridged by imports.
Gap,
MMSCMD
159
249
% of World
Consumption
Fossil Fuel Availability
168
206
199
Energy Consumption
(Mtoe)
473
197
293
Country
Total World Consumption: 16,922 Mtoe
Share of Primary Energy Consumption, %
Projected Gas Demand, MMSCMD
Rank
15%
179
South Africa
36
Saudi Arabia
92
4%
Brazil
6%
India
35
211
Russia
9%
6%
3
Western Europe
38
Japan and South

Korea
88
20%
20%
China
19%
USA
600
500
400
300
200
100
0
Projected Primary Energy Consumption in 2025
305
Supply,
MMSCMD
FY 2017
Source: BP Statistical Review, Tata Power, India Energy Book 2012, World Energy Council, GAIL, Oil India Limited, NTPC, Planning Commission
-7-
Power Sector Snapshot (cont'd)
(charts show Indian fiscal years)
Capacity Addition Targets (MW) for the XII Plan (2012-2017)
XI Plan (2007-12) Capacity Addition - Target Vs Actual

Actual as Percent of Target
39,829
Hydro, 9,204
Coal, 62,695
12.14%
Total: 75,785 MW
3.7%
1.43%
38%
10,760
Gas, 1,086
State Sector, MW
Target
Private Sector Vs Total Capacity Additions
FY 2009
5,061
13%
21,180
56%
42,131
-10.10%
-12.00%
FY 2011
FY 2012
FY 2013
-8.50%
-8.50%
-8.71%
-9.00%
-9.80%
-10.60%
-11.90%
-13.30%
IX Plan (1997-2002) X Plan (2002-2007) XI Plan (2007-2012) XII Plan (2012-2017)

(F)
-16.00%
Energy Requirement/Availability Gap, %

Peak Demand/Supply Gap, %
Total Capacity Addition, MW
Source: NTPC, Association of Power Producers (APP), CEA

Actual
-11.10%
23,012
2,671
Private Sector Capacity Addition, MW
FY 2010
-8.00%
42%
19,015
Private Sector, MW
Energy Availability and Peak Supply Gaps

75,785
Private Sector Capacity Addition as Percent of Total

Capacity Addition
54,964
23,012
60%
16,732
15,220
Nuclear, 2,800
Central Sector, MW
27%
214%
27,952
82.7%
-8-
Utilities as Percent of GDP

Industrial Production Index - Electricity
IPI Weight, FY 2014 GDP Growth Forecasts
149
180
160
140
120
100
80
60
40
20
0
8.19%
138
131
123
6.08%
5.50%
3.95%
2.75%
FY 2009
FY 2010
FY 2011
FY 2012
Industrial Production Index - Electricity, FY 2005 is base
With a weight of 10.32%, electricity is the fourth-largest contributor to India's

industrial production index (IPI), preceded by manufacturing with 75.53%,
mining with 14.16% and basic metals manufacturing with 11.34%,
respectively, the statistical supplement of the Economic Survey of India for
FY 2013 showed. Chemicals and chemical products have a weight of
10.06% and food products and beverages of 7.28%.
9%
8%
7%
6%
5%
4%
3%
2%
1%
0%
155
In June 2013, the IMF revised its GDP forecast for India for the current fiscal
year (FY 2014) to 5.6% from 5.8% issued in April.
In September 2013, HSBC cut its forecast for India's GDP growth to 4.0%
from 5.5%, while in October the World Bank lowered its forecast for FY 2014
to 4.7% from 6.1% estimated in April.
FY 2013
% y/y change
Utilities as % of GDP
60,000
40,000
41,587
2.00%
45,161
52,436
55,054
2.05%
2.00%
1.95%
20,000
0
49,370
1.88%
1.88%
1.87%
831
882
928
988
1,029
FY 2009
FY 2010
FY 2011
FY 2012
FY 2013
80,000
1.95%
60,000
1.90%
40,000
1.85%
20,000
1.80%
53,036
1.86%
61,089
83,535
1.80%
1.80%
Source: CEIC, EMIS Insight calculations

-9-
1.80%
1.75%
1.73%
1.72%
1.90%
1.85%
72,670
1.70%
911
1,139
1,310
1,448
1,702
FY 2009
FY 2010
FY 2011
FY 2012
FY 2013
All India GDP, INR bn (Current Prices)

GDP Electricity, Gas and Water Supply, INR bn (Current Prices)
Electricity, Gas and Water Supply GDP as % of Total GDP
All India GDP, INR bn (Constant Prices, FY 2005 is base)

GDP Electricity, Gas and Water Supply, INR bn (Constant Prices, FY 2005 is base)
Electricity, Gas and Water Supply GDP as % of Total GDP

94,610
100,000
1.65%
1.60%
Wholesale Price Index (WPI)

Wholesale Price Index (WPI), Fuel and Power and Subsectors, FY 2005=base
240
220
200
180
160
140
120
100
Mar-12
May-12
Apr-12
Jul-12
Jun-12
Sep-12
Aug-12
WPI Fuel and Power
Nov-12
Oct-12
Jan-13
Dec-12
WPI Fuel and Power - Coal
Mar-13
Feb-13
May-13
Apr-13
Jul-13
Jun-13
WPI Fuel and Power - Mineral Oils
Sep-13
Aug-13
Oct-13
WPI Fuel and Power - Electricity
Wholesale Price Index (WPI), Electricity Subsectors, FY 2005=base

200
180
160
140
120
100
Mar-12
May-12
Apr-12
Jul-12
Jun-12
WPI Electricity - Domestic
Sep-12
Aug-12
Nov-12
Oct-12
WPI Electricity - Commercial
Jan-13
Dec-12
WPI Electricity - Agriculture
Source: CEIC
Mar-13
Feb-13
- 10 -
May-13
Apr-13
Jul-13
Jun-13
WPI Electricity - Railway Traction
Sep-13
Aug-13
Oct-13
WPI Electricity - Industry
FDI in Utilities
(charts show calendar years)
Foreign Investments in Power in India

300
250
200
6.30%
4.87%
8%
7.54%
253.37
179.77
5.72%
137.73
150
6%
158.63
148.62
50
4%
52.22
3.27%
100
12.35
11.32
11.97
7.88
4.86
0
2008
2009
2010
2011
2012
FDI Inflows, Power, USD bn

Total FDI Inflows, USD bn
FDI Inflows in Power as % of Total FDI Inflows
0.93%
0.48
2%
4.71%
Between April 2000 and March 2012, the Indian power sector
attracted FDI equity inflows of some 4%, compared to 19% by the
service sector and 7% by telecommunications.
40
5%
40.51
30
20
10
0
4%
33.94
25.60
17.52
0.81%
0.14
2008
25.73
17.45
0.82
2009
3%
2%
0.09
1.07%
0.23%
0.36
2010
2011
0.15
0.59%
2012
0.04
0.14%
1%
0%
2013
(Jan-Oct
2013)
In May 2010, the country got its first FDI in the power sector in 54
months, when Singapore-based Sembcorp announced plans to
invest in a 49% stake in a 1,320 MW thermal power plant in
Andhra Pradesh.
In December 2011, Mauritius-based private equity fund Multiples
Private Equity, set up by an Indian national, sought government
approval to acquire a minority stake in the Indian Energy
Exchange (IEX), one of the two power exchange platforms in the
country. The move sparked a debate on whether the government
needs to clarify rules on FDI in such enterprises.
According to comments by India's largest thermal power producer
NTPC, the low FDI inflow in the power sector is indicative of
concerns of the foreign investors over the government's slow
progress in dealing with the sector's structural problems.
Total FDI Outflows, USD mn

FDI Outflows - Electricity, Gas and Water, USD mn
Electricity, Gas and Water Outflows as % of Total Outflows
Source: CEIC
In spite of this, FDI inflows in the power sector have been very
moderate and have not shown a trend to increase over the years.
India's total FDI inflows are about a fourth of those of China.
0%
2013
(Jan-Jul
2013)
Indian Investments Abroad

50
The Electricity Act of 2003 makes provisions for 100% FDI in the
Indian power sector under an automatic approval scheme and
offers incentives such as 16% assured post-tax return on equity in
current dollars and a five-year tax holiday.
- 11 -
Power Sector Forecast

Soaring
Demand
India's demand for electricity may cross 300 GW earlier than most estimates, consulting firm McKinsey said in a report. The
reasons for the optimistic forecast include faster growth of India's manufacturing sector in the future compared to the past, the
rapid increase in domestic demand as the quality of life of Indians improves, and connection to the grid of some 125,000
villages. A demand of 300 GW will require about 400 GW of installed capacity, the McKinsey analysts pointed out, adding that
blackouts and load shedding currently suppress demand.
Capacity
Additions
India will need between 600 GW and 1,200 GW of new power generation capacity before 2050, according to the International
Energy Agency (IEA). The technology and fuel sources India adopts as it adds this capacity may have a significant impact on
global resource usage and the environment.
Reliance on
Imported Coal
With a share of 58.3% of Indias total installed generation capacity, coal is the single most important fuel in domestic electricity
generation. Reliance on imported coal has been steadily increasing in the past decade, with volume more than doubling to 80
MMT in FY 2012 from 30 FY in fiscal 2010. In comparison, domestic production has remained stagnant. Reliance on imported
coal for power generation in India is expected to continue. Imported coal is forecast to account for some 20% of the coal-based
generation and 19% of all generation in India by fiscal year 2017.
Natural Gas
Deficit
Net natural gas production dropped 15.94% to 38,945.61 MCM in FY 2013, against 46,326.91 MCM in the previous year, due
to lower than anticipated production by both the public and private/JV sectors. The gap between natural gas demand and
supply is expected to grow. The gas requirement of the power sector in fiscal 2017 is forecast at 100 MMSCMD. Due to the
unfavourable demand/supply balance of hydrocarbons in India, the government is encouraging national oil companies to
pursue equity oil and gas opportunities abroad as well as explore domestic shale gas deposits.
Nuclear Power
India has a largely indigenous nuclear power program and expects to have 14,600 MWe nuclear capacity by 2020. It aims to
supply 25% of electricity from nuclear power by 2050. The government has adopted a vision for the country to become a world
leader in nuclear power, due to its expertise in fast reactors and thorium fuel cycle. The use of thorium for nuclear power
generation was developed in India due to its limited availability of indigenous uranium and its being largely excluded from
nuclear trade for some 30 years. The country is a nuclear power and has not signed the Nuclear Non-Proliferation Treaty.

- 12 -
Electricity Utilisation, Consumption Forecast

Electricity Utilisation Pattern Forecast, %
Rural, Urban Electricity Consumption Forecast, %
120%
120%
100%
80%
8.27%
7.83%
35.79%
36.35%
100%
38.36%
80%
55.45%
60%
60%
40%
20%
18.96%
17.86%
10.60%
11.52%
61.64%
20%
26.38%
26.44%
FY 2017
FY 2022
Commercial
Irrigation
Industrial
58.76%
40%
0%
Domestic
68.77%
39.13%
59.09%
44.55%
31.23%
60.87%
41.24%
40.91%
0%
Northern
Others
Western
Southern
Urban
Eastern
North-Eastern
All India
Rural
Comments
The national, regional and state findings of the 18th Electric Power Survey of India were released in September 2011. The Electric Power Survey
Committee (EPSC) convened to forecast annual electricity demand for states, union territories, regions and the whole country, up to the end of the 12th
Planning Period in fiscal 2017. Another task on the committee agenda was to project electricity demand for the 13th and 14th Planning Periods, i.e. up to the
end of fiscal years 2022 and 2027, respectively.
Source: 18th Electric Power Survey of India (most recent available)

- 13 -
Energy Requirement and Peak Load Forecast

All India Energy Requirement and Peak Load Forecast
Energy Requirement Forecast, GWh

Region
FY 2014
FY 2015
FY 2016
Northern
324,206
353,738
386,382
Western
313,465
337,289
362,901
Southern
280,709
301,823
324,033
Eastern
129,725
140,637
151,668
4,000,000
3,000,000
12,621
13,703
14,878
All India
1,076,327
1,159,201
1,248,456
400,705
2,000,000
1,000,000
0
North-Eastern
600,000
541,823
400,000
283,470
200,000
199,540
1,354,874
1,904,861
2,710,058
3,710,083
FY 2017
FY 2022
FY 2027
FY 2032
All India Energy Requirement, MU, (l)
Al India Peak Load, MW, (r)
Energy Requirement and Peak Load Forecast by Region

FY 2017
FY 2022
FY 2027
FY 2032
Region
Energy
Requirement, GWh
Peak Load, MW
Energy
Requirement, GWh
Peak Load, MW
Energy
Requirement, GWh
Peak Load, MW
Energy
Requirement, GWh
Peak Load, MW
Northern
422,498
60,934
59,400
86,461
840,670
121,979
1,135,543
164,236
Western
394,188
62,015
539,310
86,054
757,318
120,620
1,028,974
163,222
Southern
357,826
57,221
510,786
82,199
727,913
118,764
1,017,526
165,336
Eastern
163,790
24,303
236,952
35,928
349,412
53,053
480,046
72,874
North-Eastern
16,154
2,966
23,244
4,056
33,952
6,169
46,921
8,450
All India
1,354,874
199,540
1,904,861
283,470
2,710,058
400,705
3,710,083
541,823
Source: 18th Electric Power Survey of India

- 14 -
Power Generation Forecasts

Power Generation Mix Forecast, %
Coal Consumption Trend Forecast

21%
19%
18%
17%
15%
120%
20%
19%
15%
11%
11%
10%
10%
11%
100%
3%
2%
FY 2013
FY 2014
FY 2015
Increase in Domestic Coal Consumption, %

Imports as % of Total Coal Consumed
FY 2016
22%
21%
20%
20%
19%
10%
9%
8%
8%
7%
14%
16%
17%
19%
19%
54%
54%
55%
53%
53%
FY 2014
FY 2015
FY 2016
FY 2017
80%
FY 2017
Increase in Imported Coal Consumption, %

60%
Transmission and Distribution Losses Forecast, %

Region
FY 2017
FY 2022
Northern
20.13
16.12
Western
19.12
14.91
Southern
16.78
15.44
Eastern
19.36
14.22
North-Eastern
22.71
18.65
FY 2013
All India
18.9
15.39
Domestic Coal
40%
20%
0%
Source: CRIS Analysis, 18th Electric Power Survey of India

- 15 -
Imported Coal
Gas
Hydro & Renewables
Water Supply Forecast

Water Demand Forecast by Sectors, bcm
807
According to the Asian Development Bank (ADB), India's

population is likely to total around 1.6 billion people in
2050. Food requirement is estimated at 400 million metric
tonnes (MMT), against current food production at about
230 MMT.
543
43
Withdrawals for
Agriculture
2010
2050
111
Withdrawals for
Municipal and
Household Use
37
81
19
70
From a water supply perspective, India will have to extend

irrigation to currently rain-fed areas to meet this demand.
Industrial Withdrawals Power Withdrawals
Water Requirement Projection for All Sectors, 2050 921 BCM
Average Annual Water Resource Potential, bcm, 2030

Available Water Resources
Utilizable Water Resources

Ground
Water
(GW),
BCM,
230
Ground
Water
(GW),
BCM,
400
Surface
Water
(SW),
BCM,
2,118
The Ministry of Water Resources forecast total water

requirement in 2050 for all sectors including irrigation,
domestic, industry, power, inland navigation, ecological,
and evaporation losses, at 1,180 billion cubic meters
(bcm). The return flows have been estimated at 259 BCM,
giving a net requirement of 921 BCM for 2050.
Climate change impact is expected to increase
demand, mainly for agriculture, due to increased
evaporation from cropped areas.
An expert committee on Indian urban infrastructure and
services has estimated the total capital investment
needed in the urban water and sewage sector at INR
7,546.27bn over the next 20 years.
Surface
Water
(SW),
BCM,
514
Source: Ministry of Water Resources, Asian Development Bank, 2030 Water Resources Group, Planning Commission
- 16 -
Employment and Salaries

Daily Average Number of Employees
FY 2009
Daily Avg No. of Employees in
Electric Power Generation,
Transmission and Distribution
Average Daily Wages in Utilities

FY 2010
26,913
550.71
472.27
28,926
462
365.17
Daily Avg No. of Contract Workers in

Electric Power Generation,
Transmission and Distribution
8,034
13,600
Daily Avg No. of Employees in Water

Collection, Treatment and Supply
833
452
169
N/A
1,156
937
170
385

Water Collection, Treatment and
Supply
Daily Avg No. of Employees in
Sewerage
Sewerage
291.5
263.59
Average Daily Wage in Electric Average Daily Wage in Water

Power Generation,
Collection, Treatment and
Transmission and Distribution,
Supply, INR
INR
FY 2009
Average Daily Wage in

Sewerage, INR
FY 2010
Employment in Utilities
946
940
920
910
870
860
850
850
800
840
840
830
41
50
40
50
50
50
40
50
50
60
60
70
FY 2000
FY 2001
FY 2002
FY 2003
FY 2004
FY 2005
FY 2006
FY 2007
FY 2008
FY 2009
FY 2010
FY 2011
Employment in Electricity, Gas and Water Utilities - Public Sector, thou persons
Employment in Electricity, Gas and Water Utilities - Private Sector, thou persons
Source: CEIC
- 17 -
II. Utilities Government Policy

- 18 -
Power Sector Government Policy
Key Bodies
The Ministry of Power (MoP) of India - acts as a liaison between the central government and state utilities of public and private
ownership, as well as oversees rural electrification projects.
The Central Electricity Authority of India (CEA) MoP's planning arm, provides advise to the central and state governments and
regulatory commissions on technical matters relating to generation, transmission and distribution of electricity. It also provides
operational advise to state governments and utilities.
Central Electricity Regulatory Commission (CERC) a key regulator of the power sector in India, in charge of overseeing the tariffs
of state-owned power generating companies and regulating interstate transmission of energy.
Other
Institutions
The Ministry of Coal is in charge of exploration of the coal and lignite reserves of India, as well as of production, supply, distribution
and price of coal through government-owned coal major Coal of India Limited (CIL).
The Department of Atomic Energy (DAE) of India is a body directly under the Prime Minister, in charge of nuclear technology,
nuclear power and research.
The Ministry of New and Renewable Energy (MNRE) the chief institution in charge of implementing renewable energy policies and
programs in India. It was established as Ministry of Non-Conventional Energy Sources in 1992 and assumed it current name in 2006.
The Petroleum & Natural Gas Regulatory Board (PNGRB) Act of 2006 provides the legal framework for the development of the
natural gas pipelines and city or local gas distribution networks.
Electricity Act
2003
The Electricity Act, 2003, is a key legislation regulating generation, distribution, transmission and trading in power in India. It replaced
laws adopted in 1910 and 1948 which were unable to meet modern-day electricity demand and realities. The act de-licenses power
generation, except for hydropower projects over a certain size, de-licenses distribution in rural areas and introduces a licensing regime
for distribution in rural areas. In addition, the act stipulates that 10% of the power distributed to consumers has to be generated from
renewable and non-conventional sources of energy.
Power Finance Corporation Ltd. (PFC) is the financial backbone of the Indian power sector. It provides financial assistance for
power projects across India and also provides funding to State Electricity Boards (SEBs) (which are both electricity regulation boards
and power generating companies), central and state sector power utilities and private companies.
Source: CEA, Power Ministry, CERC, Coal Ministry, DAE, MNRE, PNGRB, PFC
- 19 -
Power Sector Government Policy (cont'd)
Power
Legislation
National Electricity Policy, 2005 adopted as required by the Electricity Act of 2003. Policy sets priority on hydropower, highlights
the need for increased use of natural gas and nuclear power, pledges to make thermal power less polluting by using low-ash coal and
sets recommendations for improving the transmission and distribution of power.
National Water Policy, 2005, Small Hydropower Policy, 2007 (for plants with capacity of below 20 MW), Hydropower Policy, 2008
- emphasis on development of Indias full hydropower potential, states encouraged to develop workable PPP projects.
The Energy Conservation Act of 2001 was adopted to promote energy saving, reduce Indias energy intensity and curb energy
wastage. The act was amended in 2010. The Bureau of Energy Efficiency (BEE) is a Government of India agency under the Ministry
of Power, in charge of encouraging the conservation and efficient use of energy in India. BEE was set up in 2002 under the provisions
of the Energy Conservation Act of 2001.
Rural
Electrification
Scheme
(RGGVY)
A comprehensive scheme of rural electricity infrastructure and household electrification for providing access of electricity to all rural
households was launched by the government of India in Apr 2005. Under the scheme, called Rajiv Gandhi Grameen Vidyutikaran
Yojana (RGGVY), state capital subsidy is provided for projects under the following panels: Rural Electricity Distribution Backbone
(REDB), Creation of Village Electrification Infrastructure (VEI), Decentralised Distributed Generation (DDG) and Supply and
Electrification of Below Poverty Line Households. In addition, states develop their own Power Distribution and Rural Electrification
Projects. Some 80% of India's inhabited villages were electrified and 44% of the rural households had access to electricity, according
to the 2001 Census. As of July 31, 2011, 96% of India's villages had access to electricity, the Planning Commission said in its report
on Power in the XII Planning Period (2012-17).
Ultra Mega
Power
Projects
(UMPP)
Projects under this initiative, aimed at bridging the gap between Indias power demand and supply, are awarded to developers on the
basis of competitive bidding, by the Ministry of Power in association with CEA and PFC. Each of the coal-based projects has about
4,000 MW capacity.
According to the government's Economic Survey for FY 2012, four UMPPs at Sasan in Madhya Pradesh, Mundra in Gujarat,
Krishnapatnam in Andhra Pradesh and Tilaiya in Jharkhand, respectively, had been awarded to developers. The Mundra UMPP,
owned by Tata Power and functioning on coal imported primarily from Indonesia, started operations in March 2012. The Tiliaya UMPP,
awarded to Reliance Power, is expected to be up and running in 2015.
A 50,000 MW hydroelectric initiative, aimed at building a combined 50,000 MW of hydropower capacity in 16 states, was launched in
2003. UMPPs are regulated by the Revised Mega Power Project Policy of 2009.
Source: World Resources Institute, Planning Commission, India Economic Survey 2011-12, Reliance Power
- 20 -
Power Sector Government Policy (cont'd)
Energy
Efficiency
Management
National Mission on Enhanced Energy Efciency (NMEEE) an Indian government initiative designed to address inefficient energy
use, developed under the Energy Conservation Act of 2001. A major energy saving initiative is the Perform, Achieve, Trade (PAT)
scheme. PAT is a trading mechanism aimed at stimulating high-energy-consuming industries to implement energy efciency measures
and to comply with energy consumption targets set by the Bureau of Energy Efciency. Under PAT, 478 Designated Consumers (DCs)
have been selected from eight industrial sectors including the power sector. The DCs have been given targets to reduce energy
consumption by March 2015. If the DCs are unable to achieve the allocated targets, they would be either required to purchase Energy
Saving Certicates (ESCerts), or pay penalty corresponding to the shortfall in their target achievements.
Financial
Incentives to
Electrical
Utilities
India's Finance Act of 2012 provided a number of incentives to the domestic power sector. Steam coal has been fully exempted from
basic custom duty and countervailing duty (CVD) has been reduced to 1% until March 31, 2014. Coal mining projects have also been
fully exempted from basic custom duty on imports. Import duties on natural gas have been scrapped. Tax withholdings on External
Commercial Borrowing have been reduced to 5% from 20% and income tax exemption rules have been extended to power plants that
had started generation by the end of the FY 2012 in March.
Reforms in
Distribution
Power distribution is a highly regulated segment, so government policies play a crucial role in its development. Power distribution in
India, a link between power consumers and generators, is plagued by high distribution losses and low billing recovery, which results in
the poor financial health of utilities. The Accelerated Power Development and Reform Program (APDRP) was launched in FY 2003
to improve the financial viability of state utilities, reduce transmission and distribution (T&D) losses and improve the reliability, quality
and availability of power supply. In FY 2008, the government introduced the Re-Structured Accelerated Power Development and
Reforms Program (R-APDRP) to implement IT systems for distribution and launch large-scale distribution franchising.
Source: NTPC, Tata Power, Chandigarh Engineering Dept.

- 21 -
Renewable Energy Government Policy
Market
Mechanisms
Details
Significance
Technologies for power generation from Renewable Energy Sources (RES) are evolving and
the Indian RES market is expected to mature rapidly. As a result, the cost of renewable-based
generation is expected to decrease. The Indian RES market functions under two governmentpromoted mechanisms Renewable Energy Certificates (REC) and Renewable Purchase
Obligations (RPO). RECs are a policy mechanism to promote RE-based power generation in
India. RPO is being implemented throughout the country to create demand for renewable
energy. Under the Electricity Act 2003, the National Electricity Policy 2005 and the Tariff Policy
2006, State Electricity Regulatory Commissions (SERCs) are required to purchase a certain
percentage of power from renewable energy sources.
Various State Commissions have established an RPO obligation for their distribution
companies. They have also determined the tariffs for RES generation based on different
technologies. However, the specified RPO varies from 1% to 10% across the country. At the
same time, there is wide divergence in the tariffs of different technologies set by different
Regulatory Commissions. REC is aimed at addressing the mismatch between the availability
of RE resources in states and the requirement of the obligated entities to meet the RPO. Under
the REC mechanism, RE generators have two options - to sell the renewable energy at a
preferential tariff or to sell the two cost components of RE generation (1) electricity
generation and (2) environmental attributes associated with RE generation - separately. The
environmental attributes can be exchanged in the form of RECs.
Subsequent to the launch of the Jawaharlal Neru National Solar Mission (JNNSM) in 2010,
almost every state announced a solar-specific percentage as a part of the overall RPO. These
are currently in the range of 0.25% to 0.5% and are expected to go up to 3% by 2022. Solar
generation is complemented by solarsector specific RECs. RECs are issued to RE generators
for 1 MWh of RE electricity injected into the grid, and are valid for 365 days after the date of
issuance. Purchase of RECs is equivalent to purchase of RE for RPO compliance.
Strengthening the REC mechanism is expected to help manage the liquidity in the RE market
by allowing states that lack RE sources to meet their RPO. There could be significant
opportunities in the RE sector, depending on how the REC market evolves, and also on
whether regulators penalise distribution companies that do not meet their RPO.
Source: Council of Energy, Environment and Water, Tata Power, NTPC

- 22 -
Mid-Term Potential
The Planning Commission
estimated
the
total
medium-term (up to FY
2032) potential for power
generation
from
RE
sources, such as wind,
small hydropower plants,
solar, waste-to-energy and
biomass, in India at some
183,000 MW.
Government measures to
boost RE energy
development:
Fiscal
and
financial
incentives
such
as
capital/interest subsidies
and nil or lowered excise
and customs duties.
Preferential tariff for gridinteractive
renewable
power in most states.
FDI of up to 100% under
the automatic route.
JNNSM targeting 2,000MW
of grid-connected solar
power by 2022.
Urban Water Supply Government Policy
Strain on
Urban
Infrastructure
According to the United Nations Population Division, between 500 and 600 million Indians, equivalent to roughly half of the countrys
population, will live in cities by 2030. As a result, urban infrastructure is coming under severe pressure. In an attempt to boost urban
infrastructure development, the Indian government launched the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) in
December 2005 to fast-track the development of 65 cities across the country. The initiative envisaged spending USD 11bn over
seven years on water, sanitation, drainage, solid waste management, roads, transport and urban renewal. Water supply projects
under JNNURM focus on goals such as reducing non-revenue water (NRW) below 15% and introducing volumetric tariffs, 100%
metering of all connections as well as a 24-hour water supply, among others.
Urban
Renewal
Mission
JNNURM covered 65 Mission Cities and several hundred non-mission cities. The interventions in the Mission Cities are covered by
two sub-missions called Urban Infrastructure and Governance (UIG) and Basic Services to the Urban Poor (BSUP). The non-mission
cities, on the other hand, have two sub-schemes called Urban Infrastructure Development Scheme for Small and Medium Towns
(UIDSSMT) and Integrated Housing and Slum Development Programme (IHSDP). The UIG and UIDSSMT components are managed
by the Ministry of Urban Development (MoUD), while Ministry of Housing and Urban Poverty Alleviation (MoHUPA) is the nodal
agency for the other two components.
Steps to
Improve Urban
Water Sector
According to a report by ADB and another by the Indian Planning Commission on water guidelines for the 12th planning period ending
2017, measures that need to be adopted to address the issues faced by the urban water sector include making the installation of
rainwater harvesting systems mandatory for all public and private buildings, levying progressive water tariffs to discourage waste of
water while providing a basic quantity of water at a low price, introducing mandatory water supply metering, developing a suitable
strategy for operation and maintenance of the assets of water utilities, empowering local bodies to impose penalties for water wastage,
encouraging the usage of low-volume flushing cisterns and promoting the recycling of wastewater.
Source: CEA, UN Population Division, Grant Thornton, ADB, Indian Planning Commission
- 23 -
LPG, PNG Government Policy

The Indian government controls fully the prices of LPG and kerosene and partially de-controlled those of petrol and diesel in 2010 and 2013, respectively.
Subsidies are provided on 14.2 kg LPG cylinders sold to households under the PDS Kerosene and Domestic LPG Scheme of 2002. Subsidised LPG is
termed "domestic" and is only for residential usage. In September 2012, the government limited subsidised LPG to six cylinders per household a year but in
December said it would raise the cap to nine cylinders per year. As of December 2012, subsidised LPG cost INR 410.66 per cylinder, against a market price
of some INR 896 per 14.2-kg bottle. The price of 19-kg commercial-usage cylinders is market-linked and higher than the market price of the 14.2-kg bottle.
Subsidy
Details
The total amount of the LPG subsidy was INR 19.89bn in FY 2013, according to data by the Petroleum Planning and Analysis Cell. As
of Aug 16, 2013, LPG's cost to Oil Marketing Companies (OMCs) (desired price) was INR 807.98 per cylinder. The price OMCs
charged to retailers (depot price) was INR 373.41, and the retail price charged to consumers was INR 410.66. The difference of INR
434.57 between the desired and the depot price represents the OMCs under-recoveries per cylinder as of that date. The central
government subsidy totalled INR 22.58. The remaining INR 411.99 (to INR 434.57) were shared by upstream (oil producing)
companies and the OMCs themselves.
Consumers
Must Make a
Choice
Households pay for PNG less than they do for subsidised LPG, which results in many using PNG, while continuing to get refills of their
LPG bottles. In early 2009, the government said households using PNG will have to give up their LPG connections. Authorities also
authorised state-owned OMCs to develop a mechanism for blocking multiple or back-up LPG connections, the newswire added.
According to a report by The Hindu dated Oct 20, 2013, India is home to some 140 million LPG connections, of which 25 million are
believed to be multiple LPG connections or to exist parallel to PNG infrastructure. Some 6.3 million of these have already been
blocked by OMCs.
LPG
Connection
Portability
In early 2013, the government launched an LPG portability scheme allowing consumers to change LPG dealers but not the supplying
oil company. In October, the scheme - which is available in 24 cities across India - was enhanced by the possibility for consumers to
buy small 5-kg cylinders at retail company-owned company-operated outlets (COCO), which account for some 3% of all filling stations
in the country. According to an Oil Ministry official, inter-company portability was not legally possible, as the current law required LPG
cylinders belonging to a particular company to be refilled only by that company. The ministry was looking into ways to amend the law
or allow users to return their bottles before signing up for a new connection to a different company, the official added.
Source: Petroleum Planning and Analysis Cell, International Institute for Sustainable Development/The Energy and Resources Institute, EMIS Insight
- 24 -
III. Power Generation - Overview

- 25 -
Power Sector Highlights

Installed
Capacity
India's power generation sector boasts the world's fifth-largest installed capacity, at 223.34 GW as of March 31, 2013. Captive
power plants generate additional 43.3 GW. Thermal power plants, fuelled by coal, gas and diesel, constituted more than 67% of
the installed capacity, with coal alone accounting for 58.3% of capacity at the end of FY 2013 in March. Hydro power plants and
those using renewable energy sources had shares of some 17.7% and 12.32%, respectively.
Demand
Outstrips
Availability
Electricity demand in India traditionally outstrips availability, both in terms of base load energy and peak availability. In FY 2013,
base load requirement was 998,114 GWh against availability of 911,209 GWh, which translated into an 8.7% deficit. The
percentage dipped slightly from FY 2012, when peak load demand was 130 GW, against availability of 116 GW, which resulted
in a 10.6% deficit. Peak load deficit was 9.0% in FY 2013.
Electricity
Subsidies
State governments sell electricity to consumers at discounted rates and also grant capital subsidies to the state utilities.
Policies and electricity tariff rates differ among states and between consumer categories in each state. State utilities compute
tariffs on the basis of revenue required and sales forecasts. Tariffs are subject to approval by state regulatory commissions.
The approved tariffs are often lower than those suggested by the companies. State governments then compensate utilities with
a cash subsidy that is supposed to be paid in advance for the upcoming financial year but is often paid later.
Network
Losses
India's transmission and distribution (T&D) losses totalled 23.65% of distributed electricity in FY 2012, against a world average
of some 15%. According to expert estimates, technical factors contribute up to 20% of total losses. Non-technical losses result
from illegal tapping of lines and the installation of faulty electric meters that underestimate actual consumption, among others.
Intermittent
Supply
More than 300 million Indians, comprising nearly half of the rural and 6% of the urban population, had no access to electricity
as of December 2011. Industry experts often criticise the electricity supply in India as intermittent and unreliable with blackouts
and power shedding interrupting irrigation and manufacturing across the country.

- 26 -
Power Generation, Electricity Demand

Power Generation, TWh, FY 2013
1,000
876.89
912.06
900
5.28
32.29
32.87
800
130.51
Electricity Consumption by Sectors, GWh, FY 2013
4.79
Traction 15,431
Industrial 382,670
113.72
44.87%
Import from
Bhutan
700
1.81%
Total
Consumption
(figure by
CEA):
852,902 GWh
600
Nuclear
500
400
300
708.81
760.68
Hydro
17.95%
5.25%
8.33%
200
Others 44,809
21.79%
100
Thermal
Commercial
71,019
0
FY 2012
Agriculture
140,960
FY 2013
Household
185,858
Comments
In India, a kilowatt hour is called a unit of energy. Energy is traditionally measured in Million Units (MU) = million KWh and Billion Units (BU) = billion KWh.
1 MU = 1 Gigawatt hour (GWh), and 1 BU = 1,000 MU = 1 Terawatt hour (TWh). For example, 855 BU=855,000 MU=855 TWh. All power and electricity
figures taken from Indian sources and measured in MU and BU, have been converted to GWh and TWh for convenience.
On the other hand, 1 TWh per year = 114 megawatts (MW). [1 megawatt = 10^6 watts; 1 terawatt = 10^12 watts. 1 year = 8,765.813 hours.]
Source: Tata Power, NHPC, NTPC, CEA, 18th Electric Power Survey of India Report
- 27 -
Installed Capacity and Capacity Additions in FY 2013

Installed Generating Capacity (GW) by Type of Fuel, FY 2013
17%
Installed Capacity by Sector (GW), FY 2013
Gas (Thermal)
20.1
Diesel (Thermal)
1.2
9%
Companies owned
by State
Governments
(State Sector) 68.9
Nuclear 4.8
Private
Companies
(Private Sector)
65.36
68.9%
2.15%
Coal (Thermal)
130.2
58.3%
Total:
223.34 GW
12.32%
29.26%
RES 27.5
17.7%
Companies owned
by the Central
Government
(Central Sector)
89.12
Hydro 39.5
39.91%
Comments
India's total installed capacity was 223.34 GW as of March 31, 2013, the world's fifth-largest. Capacity additions expected in FY 2014 total 18,432 MW,
comprising 15,234 MW of thermal, 1,198 MW of hydro and 2,000 MW of nuclear power stations. The country's gross energy generation from the power
plants in operation and those expected to be commissioned by the end of FY 2014, has been assessed at 975 TWh, the Central Electricity Authority (CEA)
said.
The number of villages with provided access to electricity jumped by 37,099 to 593,732 in FY 2013 from 556,633 in FY 2012.
Source: Central Electricity Authority, Tata Power, NTPC, Infraline Reports
- 28 -
Capacity Utilisation and Per Capita Consumption

Thermal Power Capacity Utilisation, PLF %
All India Annual Per Capita Consumption of Electricity
82.01%
76.19%
79.18%
68.35%
67.27%
FY 2013 (1st Year of 12th Plan)
73.47%
75.69%
69.93%
65.54%
917
FY 2012 (End of 11th Plan)
62.16%
884
672

Central PLF, %
State PLF, %
IPP PLF, %
FY 2012
559
465
Private PLF, % All India PLF, %

Per Capita Electricity Consumption, kWh
FY 2013
Comments
Capacity utilisation in the Indian power sector is measured by a Plant Load Factor (PLF). Plant Load Factor is the ratio of the actual output of a power
plant over a period of time and its output if it had operated a full capacity of that time period.
Plant Load Factor = Gross Generation / (Installed Capacity * Number of Hours).
Per Capita Consumption = Gross Electrical Energy Availability/Mid-Year Population.
Per capita electricity consumption in India about one-third of the worlds average, but is expected to reach 5,000-6,000 kWh by 2050, which would require
about 8,000 TWh per year.
Source: CEA, NTPC, Sterlite Technologies
- 29 -
Energy Requirement/Availability Gap

All India Energy Requirement/Availability Gap
Requirement/Availability Gap by Regions, FY 2013

-27,534
300,000
-10.10%
-8%
50,000
-12%
-11.10%
0
FY 2009
FY 2010
FY 2011
FY 2012
FY 2013
-15.50%
Availability (GWh)
-10%
-14%
-16%
-18%
Northern
Western
Southern
Deficit, GWh
Requirement (GWh)
-8%
-12%
100,000
-10%
-6%
-7.30%
10,718
-8.71%
-2%
-4%
11,566
-9.20%
150,000
-8.50%
-848
-4.60%
107,457
-6%
-4,947
238,058
200,000
281,842
-4%
0%
-43,784
-3.30%
286,683
250,000
-9,792
296,475
-2%
300,774
998,114
350,000
102,510
200,000
-8.50%
-86,905
911,209
861,591
830,594
400,000
746,644
777,039
600,000
691,038
800,000
857,886
-86,001
-79,313
937,199
-73,236
-83,950
788,355
1,000,000
0%
273,240
1,200,000
Eastern
North-Eastern
Deficit, GWh
Requirement (GWh)
Demand Deficit, %
Availability (GWh)
Demand Deficit, %
Comments
India's energy requirement and availability are forecast at 1,048,533 GWh and 978,301 GWh for FY 2014, respectively. This translates into a shortage of 70,232
GWh, or a deficit of 6.7%, according to CEA. India's energy requirement outstripped availability between FY 2009-2013. Both requirement and availability reported
annual increases in the observed years, so that the gap between requirement and availability remained essentially unchanged. In percentage terms, the energy
requirement deficit reported an average value of -9.4% between FY 2009-2013. Therefore, a constitutional gap between requirement and availability exists in the
country. In the future, as demand grows further, India will have to either boost generation capacities by exploiting more own resources, increase inter-state power
trading or rely on imports.
Source: CEA, EMIS Insight calculations
- 30 -
Peak Load Demand/Supply Gap

Peak Demand-Supply Gap
Peak Demand-Supply Gap by Regions, FY 2013
38,767
31,586
-10%
-12%
-14%
-16%
-18.50%
1,864
5,000
FY 2011
Supply (MW)
FY 2012
-18%
-20%
Northern
-14%
-6%
-8%
-13.30%
Demand (MW)
-4%
-6.70%
-7.40%
10,000
-12%
FY 2010
45,860
15,000
-134
-1,240
16,655
-10.60%
-7,181
-8.90%
20,000
-10%
-2%
39,486
25,000
0%
-1.50%
40,075
123,294
-6%
-9.00%
-11.90%
FY 2009
30,000
-589
15,415
-9.80%
35,000
-4%
-4,070
1,998
20,000
40,000
-8%
60,000
40,000
45,000
-2%
135,453
116,191
-13,815
130,006
110,000
-12,000
122,000
-15,747
102,725
96,785
80,000
109,809
100,000
-13,024
118,472
140,000
120,000
50,000
0%
-12,159
41,790
160,000
Western
Southern
Eastern
North-Eastern
FY 2013
Demand Deficit, %
Demand (MW)
Deficit, MW
Supply (MW)
Demand Deficit, %
Deficit, MW
Comments
India's peak demand and supply are forecast at 144,225 MW and 140,964 MW for FY 2014, respectively. This translates into a shortage of 3,261 MW, or a
deficit of 2.3%, according to CEA's Annual Load Generation Balance Report (LGBR) for FY 2014. Considering transmission constraints, however, the
anticipated peak shortage increases to 6.2%, CEA added. Similarly to energy requirements and availability commented on in the previous slide, peak load
demand and supply reported increases between FY 2009-2013. Deficit remained large, at an average value of -10.9%, but in the years after FY 2010, it
has been smaller compared to 2010, perhaps due to utilities striving to add capacities to reduce power cuts. Peak load demand is set to further increase in
the future, not only because of current consumer usage, but also as a result of new consumer additions under the rural and urban electrification programs.
Source: CEA, EMIS Insight calculations
- 31 -
IV. Power Generation by Type of Fuel

- 32 -
Coal
Sufficiency of Coal Reserves in Meeting India's Power Demand
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
40
22
12
39,761
24,492
12,879
9,297
Jharkhand
Orissa
Chhattisgarh
Andhra
Pradesh
8,871
Madhya
Pradesh
5
5,490
45
40
35
30
25
20
15
10
5
0
Maharashtra
Top 6 States with Proven Coal Reserves (million tonnes)

No. of Years Reserves Can Support India's Power Requirement
Share of Coal-Fired Plants in Total Installed Capacity, 2012

92%
77%
76%
China
Australia
56%
India
South Africa
Share of Coal-Fired Plants in Total Installed Electricity Capacity, 2012
Source: Tata Power, Sterlite Technologies, CRIS Analysis, Coal India

- 33 -
With a share of 58.3% of India's total installed generation

capacity, coal is the single most important fuel in domestic
electricity generation.
Some 75 thermal power projects depend on governmentowned Coal India Ltd. (CIL) for supplies. Power projects
absorb about 80% of domestic output. It takes some 5,000
tonnes of coal to generate 1 MW of power.
CIL accounted for about 81% of the total coal produced in
India in FY 2013. The countrys ever-increasing demand for
coal is expected to total 980 million tonnes by FY 2017. The
power sector is to account for some 70% of this demand.
In FY 2013, CIL reported output of 452.21 million tonnes of
coal, against 435.84 million tonnes in FY 2012.
Domestic coal availability is challenged by a number of
issues including bottlenecks in capacity expansion of CIL and
coal block allocation, tribal land acquisition and
environmental and forest clearances. Most of Indias coal
deposits are located under forest land.
Coal-based plants also face issues related to water
availability and ash disposal.
Thermal coal imports are needed to bridge the gap between
demand and domestic coal availability.
Reliance on imported coal has been steadily increasing in the
past decade, with volume more than doubling to 80 MT in FY
2012 from 30 MT in FY 2010. In comparison, domestic
production has remained stagnant.
Coal (cont'd)
CIL Production and Dispatch to Power Sector
285
299
304
310
312
FY 2009
FY 2010
FY 2011
FY 2012
FY 2013
CIL Production, MT
As of March 31, 2013, the President of India held 90% in

CIL. The remaining 10% were owned by Indian and
overseas financial institutions, pension funds and other
investors, following a 2010 IPO. The government of India
has repeatedly stated it aimed to further reduce its stake
in CIL through share offers in the markets, a Sep 2013
report by the Institute for Energy Economics and Financial
Analysis (IEEFA) and Greenpeace said.
CIL's current measure of its extractable reserves, by its
own research subsidiary the Central Mine Planning and
Design Institute Limited (CMPDIL), is 16% below the
estimates contained in the 2010 IPO papers, the IEEFA
and Greenpeace report added.
There remains significant uncertainty about the true extent
of CILs extractable reserves. The Indian Chamber of
Commerce considers an accurate account of CILs
extractable reserves as a critical reform to Indias coal
policies.
Domestic coal prices have grown at a slower rate than
imported coal prices over the past five years. Imported
coal is forecast to account for some 20% of the coalbased generation and 19% of all generation in India by FY
2017, CRISIL said.
As the reliance on imported fuel grows, power tariffs need
to become more reflective of costs and fuel prices, the
research agency added.
452
440
430
420
395
Dispatch to Power Sector, MT
Indian Coal Production and Imports
362
442
440
419
397
27
28
30
46
FY 2008
FY 2009
FY 2010
FY 2011
Domestic Coal Production, MT
80
FY 2012
Imported Coal, MT
Source: Tata Power, CRIS Analysis, Ministry of Coal, IEEFA, Greenpeace

- 34 -
Legal Framework for IPP Projects in India

Legal Options for Establishing IPP Projects in India
A merchant plant
In India,
there are
three options
for setting up
an
Independent
Power
Producer
(IPP) project:
Under the negotiated

route (MoU route)
Under a competitive
bidding process
Power off-take
arrangements
depend upon
the scheme
the IPP is set
up by.
The power producer does not enter

into long term off-take arrangements,
and instead sells power on a shortterm basis on the spot market or
through .a power exchange.
A memorandum of understanding
(MoU) is negotiated and executed
with a state government for setting
up the project within its jurisdiction.
The IPP candidate bids for an

identified project under the
Competitive Bidding Guidelines.
Power procurement in the Indian
market is increasingly being done
through competitive bidding.
In January 2011, the Ministry of Power decreed that all long-term power procurement by state governments and
distribution companies should be made under the competitive bidding process.
The Competitive Bidding Guidelines require project developers to bid on the basis of a level annual tariff.
Winning bidders sign a standard-form power purchase agreement (PPA) drafted by the Power Ministry.
Source: Trilegal
- 35 -
The Competitive Bidding Guidelines provide for

two bidding models:
Case I Route - the project developer is
responsible for arranging consents, land and
fuel for the power project; and
Case II Route - the procurer undertakes to
bear higher risk by arranging land and fuel
linkages for the project.
The effect of the introduction of competitive
bidding has been estimated as positive, but a
major problem is that the contractual
framework does not provide power producers
with flexibility to react to issues such as coal
shortage or increase in coal prices, leading to
project developers running a significant risk of
default. Considerable certainty on fuel price
and availability is necessary for bidders to
accurately price their bids. However, obtaining
an assured domestic coal supply arrangement
has become a challenge resulting in producers
often failing to meet their agreements with offtakers.
Competitive Bidding Policy
Coal Supply
The Ministry of Coal grants coal allocation under a long-term or a short-term linkage. To
obtain a long-term linkage, project developers file an application with the Ministry, which
issues a letter of assurance (LoA). Following fulfilment of milestones set out in the LoA, the
IPP signs a standard-form Fuel Supply Agreement (FSA) with a government-owned coal
producer [e.g. Coal India Limited (CIL)]. Under the FSA, the coal supplier guarantees up to
50% of the IPPs requirements, which is a significant risk for the project developer. In
agreements signed in late 2012 and Jan 2013, CIL guaranteed coal supplies meeting at
least 80% of plants requirements (see next slide).
Coal Supply
Problems
IPPs are entitled to full capacity charges when selling power only if their plants
operate at "normative availability", which was 85% as per tariff regulations in force in
January 2012. Under the standard PPA, if availability falls below a pre-agreed
threshold, the IPP is required to pay a penalty to the power purchaser. The power
purchaser can terminate the PPA if average availability falls below 65% of normative
availability for a specified period. Thus, IPPs are penalised for failing to achieve
normative availability due to fuel supply problems outside their control. On the other
hand, existent coal reserves cannot be transported to IPPs due to transportation
network problems.
Way Out of
Coal Supply
Problems
In an attempt to insure themselves against coal supply risks, IPPs may seek to buy
imported coal in which case they will face a substantial increase in fuel supply and
power generation costs. IPPs may seek to pass this increase on to power distributors
(which they sell power to), and ultimately to consumers. However, the Competitive
Bidding Route forbids the passing on of increased fuel supply costs. As a result, IPPs
risk incurring significant losses if they use imported coal to generate power and sell it
at the tariff agreed under their PPAs.
Source: Trilegal, Tata Power

- 36 -
Policy Changes Needed

Coal suppliers should be
required to commit to supply
100% of IPPs requirements
or provide compensation;
IPPs should not be penalised
for failing to perform their
obligations under the PPA to
the extent of the effect of the
reasons outside their control;
Allowing passing on of fuel
price increases to the extent
beyond the control of IPPs
should be allowed;
Power distribution companies

are also required to bid for
power procurement under the
Competitive Bidding Policy.
However, the negotiating
process
is
seriously
challenged as procurers are
unwilling to take fuel price
risks and would like them to
be built into the tariff. As a
result, distribution companies
prefer to procure power under
the MoU route with a fuel price
increase pass-on, or under
competitive bids on fixed
charges and efficiency.
The Fuel Supply Agreement (FSA)
Coal Demand
Above
Production
Capacity
With the nationalisation of coal mines in 1973, the government of India became responsible for managing the country's coal mines through Coal of
India (CIL) and its subsidiaries. The shortage of coal supply in recent years has limited the ability of power companies to generate at full capacity
and meet their purchase agreements with off-takers. In an effort to address coal supply uncertainties, the Ministry of Coal decreed that by March 31,
2012, CIL and its subsidiaries sign Fuel Supply Agreements (FSA) with power projects that had entered into long-term PPAs with distribution
licensees, and started operations after March 31, 2009 or are scheduled to become operational by March 31, 2015. CILs independent directors
strongly opposed the move saying that the aggregate demand under the FSAs will exceed the companys and its subsidiaries current and near
future production capacities. In April 2012, the President of India issued a decree requiring CIL to commit to supplying 80% of the coal requirements
of projects that started operations between March 31, 2009 and 2011. In case of a failure to do so, the company had to pay a penalty of 0.01% of the
value of the deficit measured against the supply commitment, or import coal to bridge the shortfall.
Controversy
over Coal
Supplies
The presidential decree sparked off a multi-level debate. Experts questioned its legality since there is no judicial precedent of a decree regulating the
management of a company. Others voiced concerns as to whether coal supplies to power producers were a public or a commercial interest. CIL
independent directors said the decree undermined their fiduciary duties to act in the best interest of the company. Power producers demanded
higher penalty, claiming that the proposed threshold of 0.01% of commitment deficit may make CIL consider penalty payment a more viable option to
importing coal. In the same time producers argued that if CIL chose to import coal to bridge its supply deficit, it may transfer higher coal costs to
them, thus making the production and delivery of power under an agreed tariff impossible. Other contentious issues included coal quality and the
need to sign multiple FSAs for multiple units of the same plant.
Indias largest thermal power producer, NTPC, declined to sign the FSA, saying the pact was lacking in commitment. As a result of the growing
pressure, the CIL Board of Directors requested the Prime Ministers Office (PMO) to review the FSA provisions in May 2012.
Attempts at
Solution
The PMO recommendations, which NTPC deemed acceptable, included fuel supply commitment of 65% instead of 80%, and a penalty of between
20% and 40% of the value of the deficit in the first four years of the agreement. Interested parties voiced enthusiasm over the Prime Ministers
recommendations, but Indias legal order makes them less binding to CIL than those of the President.
On December 10, 2012, CIL and NTPC officials met to smooth out their differences over the FSA provisions and set a date for signing the pact.
NTPC agreed to sign the FSA in June 2013 on mutually agreed terms and conditions. In August 2013, CIL modified the FSA to allow a third party to
collect samples and determine the quality of the dry fuel. As of September 6, 2013, the coal producer had signed FSAs with 140 power plants, out of
the 173 that depend on it for coal supplies. In the meantime, in the summer of 2013, CIL came under the scrutiny of Indias Competition Commission
over allegations that it abused a dominant market position in supplying fuel to power plants.
Source: Trilegal, Local media

- 37 -
Gas and Liquid-Fuel-Based Generation

Deficit in Domestic Natural Gas
163.9
103.9
85
FY 2006
111.9
115.8
120
86
84.6
89.7
FY 2007
FY 2008
FY 2009
129.5
FY 2010
179.8
178.8
142.6
FY 2011
132.5
FY 2012 Est.
Supply of Domestic Natural Gas (MMSCMD)

Total Consumption of Gas (MMSCMD)
LNG Imports, million tonnes

14
12
10
8
25%
11.632
8.922
7.958
9.73
19.55%
10.901
15%
12.11%
10%
9.06%
5%
4
2
20%
0%
-3.54%
-6.28%
-5%
-10%
FY 2009
FY 2010
FY 2011
FY 2012
Total LNG Imports (Long-Term, Spot), million tonnes
FY 2013
% y/y change
Source: Tata Power; Deloitte Touche Tohmatsu; Petroleum Planning and Analysis Cell; NTPC;
- 38 -
India was home to 20.1 GW of gas-based installed

generation capacity as of Mar 31, 2013.
The price of the gas power generators receive from stateowned GAIL are decided by the government under the
Administered Price Mechanism (APM) regime. Gas can also
be domestically sourced from companies exploiting the
Panna Mukta Tapti (PMT) fields, both at APM and non APM
prices. Generators sign Gas Sales and Transmission
Contracts (GSTCs) and long term agreements for gas
supplies.
In FY 2012, the Ministry of Petroleum and Natural Gas
(MPNG) said Indias gas output was expected to fall by 35%
by the end of the year and by additional 12% in years 2013
and 2014. For this reason, the Central Electricity Authority
(CEA) issued a statement advising investors not to plan new
capacities based on domestic gas supplies until the end of
FY 2016 in March. The embargo did not affect FY 2012
capacity additions which were a little above 1,000 MW.
The ban will also not be applicable to power projects planned
on imported LNG, which, according to comments by Tata
Power, is a direct substitute for domestic natural gas but at
almost double the price.
As a result, electricity produced from imported LNG will
increase the cost of generation, the recovery of which will be
uncertain due to highly regulated transmission. The
production of such electricity may not be financially viable.
Gas and Liquid-Fuel-Based Generation (cont'd)
27,063
FY 2008
FY 2009
FY 2011
FY 2012
38,942.61
41,025
46,326.91
51,229.29
Natural Gas Net Production, mmscm
46,042
40,831.10
FY 2010
34,303
31,751.02
26,947
31,478.57
Natural Gas Available for Sale is

derived by deducing internal use
of gas by producing companies.
46,485.88
Production and Availability of Natural Gas
FY 2013
CAGR Natural Gas Available for

Sale FY 2008-2013: 4.95%
Natural Gas Available for Sale, mmscm
Source: PPAC, CEA, GAIL, OIL, ONGC, Ministry of Petroleum and Natural Gas
- 39 -
With a share of 9%, natural gas was Indias fourth power

generation source in FY 2013, after coal with 58.3%, hydro
power with 17.7% and RES with 12.32%, respectively.
The average global share of natural gas in primary energy
consumption is some 24%. It is expected that the share of
natural gas in India's energy basket will double to 20% by
2025.
The demand for natural gas is largely met through
domestic production with imports contributing less than
30% of the total gas consumption.
With an import of 20.5 million tonnes in 2012, India has
become the fourth largest importer of LNG in the world,
ONGC said.
The main producers of natural gas are Oil & Natural Gas
Corporation Ltd. (ONGC), Oil India Limited (OIL) and
Reliance Industries. LNG is imported by state-owned
company Petronet LNG Ltd. As of March 2013, GAIL held
some 60% in India's gas marketing.
The demand for natural gas is expected to reach
more than 450 thou mmscmd by end of the XII five-year
plan ending in FY 2017, and over 600 thou mmscmd by the
end of the XII five-year plan ending in FY 2022.
In such a scenario, India will have to boost domestic
natural gas production as well as create sufficient
infrastructure for LNG imports to meet demand.
Hydropower Generation
All India Hydropower Generation, GWh
Hydropower generation accounted for 17.7%, or 39.5 GW, of
Indias total installed capacity as of Mar 31, 2013.
In the early 2000s, the Indian government adopted a strategy
to boost hydropower development in the country in an effort
to achieve a hydro-to-thermal ratio of 40:60.
Some 68% of Indias identified hydropower capacities were
still to be developed as of Nov 30, 2012.
The following hydropower projects exist in India: storage
schemes, Run-of-River (RoR) Schemes without Poundage,
RoR Schemes with Poundage and Pumped Storage
Schemes.
Problems affecting the development of the hydropower
sector include land acquisition, resettlement and
rehabilitation issues, delays in environment and forest
clearances, landslides affecting capacity construction
schedules, tunnelling in inaccessible sites and inter-states
water disputes.
The Indian government has established special mechanisms
and committees to encourage hydropower cooperation with
neighbouring Nepal, Bhutan and Myanmar, as well as with
Afghanistan.
Hydropower projects are capital-intensive, have a long
gestation period and require large investments, which all
hinders the full exploitation of Indias hydropower potential.
Since water is a state subject in India, state governments are
demanding incentives, such as free power, which results in
higher tariffs.
135,714.00
118,924.80
FY 2009
119,905.80
109,026.30
FY 2010
FY 2011
118,514.79
FY 2012
FY 2013
All India Hydropower Generation, GWh
Hydropower Stations in India as on Aug 31, 2013

No. of Stations
No. of Units
Capacity (MW)
Northern Region
61
206
15,523.25
Western Region
28
101
7,392.00
Southern Region
67
240
11,387.45
Eastern Region
17
61
4,078.70
North Eastern
All India (Total)
10
183
29
637
1,242.00
39,623.40
Note: Figures show installed capacity of stations with capacity above 25 MW
Source: CEA, hydropowerstation.com, NHPC

- 40 -
Hydropower Generation (cont'd)

Hydropower Potential Development by Region
Hydropower Potential Development by Basin
Percentages are shown in terms of Identified Capacity Above 25 MW (which is assumed to equal 100%).
Figures are as of Nov 30, 2012.
Percentages are shown in terms of Identified Capacity Above 25 MW (which is assumed to equal 100%).
Figures are as of Nov 30, 2012.
Capacity Identified
Total
(MW)
Northern
Region
53,395
Capacity Under
Operating Capacity
Construction
Above
25 MW
52,263
MW
15,643.30
29.93
MW
6,903
Capacity Under
Capacity Yet To
Operation and
Be Developed
Under Construction
MW
13.21 22,546.30
MW
Southern
Region
16,458
15,890
9,426.90
59.33
510
3.21
9,936.90
62.54
5,953.20
37.46
Eastern
Region
10,949
10,680
3,138.70
29.39
2,482
23.24
5,620.70
52.63
5,059.30
47.37
NorthEastern
Region
58,971
All India,
148,701
Total
58,356
145,320
1,242
35,002.9
68.28
2.13
400
2,810
4.92
4.82
24.09 13,105.00 9.02
5,952
4,052
48,107.80
73.20
6.94
2,179.00
54,304
26.80
93.06
33.10 97,212.20 66.90
Source: CEA
Above
25 MW
MW
Indus
33,832
33,028
11,244.3
34.04
Ganga
20,711
20,252
4,987.2
Central
Indian
Rivers
4,152
3,868
West
Flowing
Rivers
9,430
East
Flowing
Rivers
Capacity Under
Construction
MW
Capacity Under
Capacity Yet To
Operation and
Be Developed
Under Construction
MW
MW
5,596.0 16.94
16,840.3
50.99
16,187.7
49.01
24.63
1,307.0
6.45
6,294.2
31.08
13,957.6
68.92
3,147.5
81.37
400.0
10.34
3,547.5
91.71
320.5
8.29
8,997
5,660.7
62.92
100.0
1.11
5,760.7
64.03
3,236.3
35.97
14,511
13,775
7,843.2
56.94
410.0
2.98
8,253.2
59.91
5,521.9
40.09
Brahmaput
66,065
ra Basin
65,400
2,120.0
3.24
5,292.0
8.09
7,412.0
11.33
57,988.0
88.67
All India,
148,701
Total
145,320
35,002.8
24.09
13,105.0 9.02
48,107.8
33.10
97,212.2
66.90
43.14 29,716.80 56.86
8,928
5,552
Operating Capacity
Total
(MW)
Western
Region
8,131
Capacity Identified
- 41 -
Nuclear Power
Indian Nuclear Power Capacity Expansion, MW
6,000
140%
5,000
118%
114.9%
4,780
120%
India has a 42-year history of nuclear power generation

with 20 nuclear power reactors operating in six states.
100%
4,000
87.1%
4,120
80%
3,000
60%
1,890
2,000
46.9%
1,000
320
470
FY 1969
FY 1979
40%
1,010
16%
20%
0%
FY 1989
FY 1999
FY 2009
FY 2011
The countrys three-stage nuclear power program

includes a closed-fuel cycle of Pressurised Heavy Water
Reactors (PHWR) in the first stage, Fast Breeder
Reactors (FBR) in the second stage and uranium and
thorium usage in the third stage. Efforts are made towards
progressively increasing the share of nuclear power in the
countrys electricity portfolio.
Indian Nuclear Power Capacity Expansion, MW

CAGR FY 1969 FY 2011: 71.3%
% change
Nuclear Power Generation

35,000
32,451
30,000
25,000
20,000
15,000
32,863
40.81%
18,798
26,469
25.98%
14,921
22.60%
10,000
5,000
1.27%
FY 2009
FY 2010
FY 2011
Electricity Generation by NPCIL, GWh
FY 2012
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
FY 2013
% y/y change
Source: World Nuclear Association, NPCI, Department of Atomic Energy (DAE), EMIS Insight calculations
- 42 -
India's integrated energy policy aims to reach 63,000 MW

of nuclear power generation by 2032.
The Nuclear Power Corporation of India Ltd. (NPCIL) is a
state-owned nuclear power company, in charge of
generation, construction and operation of the first stage
PHWRs and Light-Water Reactors (LWR).
As of March 31, 2013, NPCIL operated 20 nuclear power

reactors with a total installed capacity of 4,780 MW. A
total six reactors, with an aggregate capacity of 4,800 MW
were under various stages of construction and
commissioning. A total eight projects with a cumulative
capacity of 16,100 MW have been proposed for launch in
the 12th Five-Year Plan.
Nuclear Power (cont'd)

Nuclear Plants in Operation, as of Mar 31, 2012
Plant Name
Tarapur Atomic Power Station (TAPS),

Maharashtra
Rajasthan Atomic Power Station (RAPS),

Rawatbhata, Rajasthan
Madras Atomic Power Station (MAPS),

Kalpakkam, Tamil Nadu
Kaiga Generating Station (KGS), Karnataka
Narora Atomic Power Station (NAPS), Uttar

Pradesh
Kakrapar Atomic Power Station (KAPS), Gujarat
Projects Proposed for Launch in the XII Plan (2012-17)
Capacity, Launch
MW
Year
Unit
Type
BWR
160
1969
BWR
160
1969
PHWR
540
2006
PHWR
540
2005
PHWR
100
1973
PHWR
200
1981
PHWR
220
2000
PHWR
220
2000
PHWR
220
2010
PHWR
220
2010
PHWR
220
1984
PHWR
220
1986
PHWR
220
2000
PHWR
220
2000
PHWR
220
2007
PHWR
220
2011
PHWR
220
1991
PHWR
220
1992
PHWR
220
1993
PHWR
220
1995
Capacity (MW)
Type
Expected Commercial
Operation
Kudankulam Nuclear Power

Project, Tamil Nadu
2 x 1,000
LWR
Unit 1 - FY 2014
Unit 2 - FY 2014
Kakrapar Atomic Power

Project, Gujarat
2 x 700
PHWR
Unit 3 - FY 2017
Unit 4 - FY 2017
Rajasthan Atomic Power

Project, Rajasthan
2 x 700
PHWR
Unit 7 - FY 2017
Unit 8 - FY 2017
Source: NPCIL
Plants under Different

Stages of Construction and
Commissioning
- 43 -
Renewable Energy
Indias Renewable Energy Basket, FY 2013
Small Hydro Power
13.01%
Biomass Power
and Gasification
4.63%
Bagasse
Cogeneration
8.43%
Waste to Power
0.35%
Wind Power
68.27%
Solar Power 5.30%
Off-Grid/Captive Power Capacities as of Jan 31, 2013

Off-Grid/Captive Power (Capacities in MW eq)
Waste-to-Energy
Biomass (non-bagasse) Cogeneration
Capacities in MW eq, as of Jan 31,

2013
116
443
Biomass Gasifiers
Rural
17
Industrial
140
Aero-Generators/Hybrid Systems
2.08
SPV Systems
107.8
Water mills/Micro Hydel
2,323 (number)
Bio-Gas Based Energy System
0.65
TOTAL
826.1
Source: Ministry of New and Renewable Energy (MNRE)

- 44 -
The installed capacity of India's renewable energy sector

increased significantly from 3.9 GW in FY 2003 to about
27.5 GW in FY 2013. Capacity was at 24 GW in Jan 2012.
Wind energy dominates India's renewable energy
industry, accounting nearly 70% of installed capacity (18.6
GW). It is followed by small hydropower (3.5 GW),
biomass power (1.26 GW) and solar power (1.45 GW).
A total capacity of 18,635 MW was installed up to January
2013 in the country, making India the fifth-largest wind
power producer in the world, after the U.S., Germany,
Spain and China. India is a major producer of wind
turbines.
The slowdown in the growth of the wind power sector in
FY 2013 that can be attributed to the withdrawal of
accelerated depreciation for investments made in the
sector, MNRE said.
A total 1,067 MW of wind power projects started
operations in FY 2013 .
A total 12,760 villages and hamlets have been covered
under the Remote Village Electrification Program as of
December 31, 2011. In FY 2013, a total 66,000 biogas
plants were installed across India, taking the total number
of biogas plants to 4.54mn.
Share of RES in Power Generation, Capacity

RES as % of Total Generating Capacity in India
318,414
17.12%
350,000
300,000
250,000
150,000
100,000
50,000
0
147,965
143,061
200,000
63,636
85,795
69,065
902
32
18
105,046
0.03%
0.05%
31-Mar-90
31-Mar-92
1.05%
132,329
12.26%
5.86%
1,658
11,125
7,761
1.58%
31-Mar-97
10.63%
9.74%
8.95%
7.78%
199,877
173,626
159,398
31-Mar-02
31-Mar-07
Total Installed Generating Capacity in India, GW
31-Mar-08
15,521
13,242
31-Mar-09
31-Mar-10
31-Mar-11
Total Installed RES Generating Capacity, GW
54,503
24,503
18,455
31-Mar-12
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
31-Mar-17 (F)
RES % of Total Capacity
RES as % of Total Energy Generation in India

1,000,000
900,000
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
844,846
799,850
722,626
670,654
517,439
3.49%
741,167
928,113
5.52%
4.87%
4.62%
245,438
6
0%
1990
39
0.01%
1992
876
0.22%
1997
2,085
0.40%
3%
2002
Total Gross Energy Generation in India, GWh
25,210
27,860
36,947
41,150
51,226
1%
0%
2007
2008
2009
Total Gross RES Energy Generation, GWh
Source: CEA
2%
1.47%
9,860
5%
4%
3.76%
395,889
287,029
6%
- 45 -
2010
2011
RES as % of Total
2012
Power Generation SWOT Analysis

Strengths
Opportunities
India offers different models of power sale including integrated utilities,

single buyers (MoU-based regulated generation), wholesale
competition (Ultra Mega Power Projects), captive power generation and
sale to captive users, as well as retail competition (open access).
Economic growth and policy reforms are triggered by social factors
such as urbanisation. Increased environmental responsibility drives
efforts to replace current polluting technologies with more sustainable
sources.
. The need for regular and sustainable sourcing of fuel will result in
company efforts to decentralise generation and distribute capacities
among various resources and technologies. Diversified generation will
be challenged by technology maturity and grid infrastructure issues.
New business models will result from regulatory intentions to privatise
distribution and transmission companies and allow distribution
franchisees as a way to bring private investment into the sector. Clarity
in commercial policies and regulations will be crucial.
Power Sector
SWOT Analysis
Delays in land acquisition, environmental clearances and indigenous

population policies block the development of power projects.
Distribution companies sell power at prices below procurement costs,
which hurts their liquidity and solvency and results in high subsidies.
The low tariff hikes approved by authorities limit the cost recovery
possibilities of companies. The ban on the pass-on of increased costs
to consumers adds to the problem. T&D losses need to be limited
through metering, feeder separation and other measures.
Domestic coal supply is estimated to last less than a century and is a

concern because of policy and logistic issues. Imported coal will result
in higher fuel and generation costs. Shortage of domestic gas and
expensive LNG imports could hamper the financial viability of gasbased power plants. The availability and cost of capital for funding new
projects is also a problem, as power projects are highly capitalintensive. The fresh water requirements of power plants can be met by
developing coastal capacities and building desalination plants.
Weaknesses
Threats
Source: Tata Power, NTPC

- 46 -
V. Power Transmission and Distribution

- 47 -
Electricity Grids
India has five electricity grids - Northern, Eastern, North-Eastern, Southern and Western. All of them are interconnected in
synchronous mode into a National Grid, except the Southern grid, which is connected asynchronously. All are run by the stateowned PowerGrid Corporation of India Ltd. (PGCI), which operated more than 100,200 circuit km of transmission lines at endMarch 2013. One-third of the population is not connected to any grid. Installed transmission capacity is about 14% of
generation capacity. Part of Indias national power strategy is to have a country-wide synchronous grid by 2014.
Power
Allocation
Electricity end-consumers are largely served by their respective State Electricity Boards (SEBs). Each SEB has an allocated
share of the electricity generated by the central sector and public-private companies, which is provided, and expected to be
drawn, at a certain price. Pricing is controlled by the central and state governments. The amount of electricity drawn below or
above the allocated daily share is called Unscheduled Interchange (UI) and is priced at a separate UI rate. PowerGrid
transmitted some 50% of the total power generated in India as of end-March 2013.
Electricity
Tariffs
End-user electricity tariffs consist of fixed- and variable-charge components, determined by the Central Electricity Authority
(CERC). The fixed-charge component covers fixed costs such as property, plant and equipment maintenance and salary
expenses; the variable-charge component covers the costs of generating electrical energy, including fuel costs linked to
generation. The actual amounts of charge components depend on each beneficiarys claim on the generation capacity used.
Power Trading
Power generation and transmission are highly capital-intensive so the fixed-charge components make up a major part of the
tariff. Thus, the average tariff becomes sensitive to the generation capacities Plant Load Factor (PLF). Investing in higher grid
interconnection that would enable trading of power from state utilities reporting surplus to those reporting deficit, could help
defer or reduce investment in additional generation capacity, would increase PLF and reduce the average cost of power for
utilities and consumers.

- 48 -
Power Transmission and Distribution Highlights (cont'd)
Power Trading
Problems
India is currently home to two power exchange platforms PXIL and IEX. According to B2B portal electricityindia.com, the
issues hampering the quicker development of inter-regional electricity exchange include relative lack of commercial awareness
by SEBs, lack of statutory provisions for direct sale by Independent Power Producers (IPPs) and Captive Power Plants (CPPs)
outside the state, and inadequate transmission capacity, among others.
Debt Recast
In September 2012, the Indian government approved a plan to relieve the debt burden of state-run power distribution
companies by taking over half of their short-term debt over the next two to five years. According to international media, the
distribution companies will issue bonds to lenders backed by the state governments against this debt. For the remaining shortterm debt, lenders will relax the terms, including extending the time of repayment. The central government will also provide
fiscal incentives to states which adopt the plan.
Temporary
Relief
The implementation of the plan is at the discretion of states, which could be a hurdle to its success. As of Sep 2013, six states
have approved the scheme, and two of them Tamil Nadu and Haryana, have already issued bonds. According to Standard
and Poors, the plan would provide only temporary relief as it fails to address tariff regulations and unreliable fuel supply.
Reliable fuel supply, according to the rating agency, depends on the existence of a transparent framework for producing fuel
and adequate infrastructure for transporting it.
Electricity
Tariffs
More than 30 states and Union Territories have raised electricity tariffs since January 2012. The move was an attempt to
improve the financial position of distribution companies, whose accumulated losses (at INR 2.4tn in FY 2013) prevent them
from meeting payment deadlines from lenders and generating companies. The average price increase was 16%. Tamil Nadu
was the state that reported the highest increase 37%, followed by Kerala 30%, Mumbai 28%, Kolkata 24% and Delhi
21%.

- 49 -
Power Transmission and Distribution Highlights (cont'd)
Grid InterConnection
Milestones
Grid management on regional basis started in the 1960s in India. Integrating regional grids to establish a national grid was
conceptualised in the early 1990s. State grids were initially interconnected to form regional grids. The initial inter-regional links
were planned for exchange of operational surpluses amongst the regions. Later the planning philosophy evolved from regional
to national self-sufficiency. The North-Eastern and Eastern grids were connected in 1991. The Western and Northern grids
joined the network in 2003 and 2006, respectively. The Southern grid is connected to the synchronous grid network through
HVDC links. Part of Indias national power strategy is to have a country-wide synchronous grid by 2014. As of March 31, 2013,
India had inter-regional transmission capacity of 29.8 GW, against 28 GW (some 14% of generation capacity) in the previous
year. Inter-regional transmission capacity is expected to grow to 58.7 GW by 2015 and some 65 GW by the end of the XII Plan
in March 2017.
Private
Participation
In an effort to meet the growing power demand of the country, the government of India has developed a legal framework for
private sector participation in power generation. Private power generating companies, called Independent Power Producers
(IPPs), are required to transmit the power they generate to state and regional load centres. Regional Load Dispatch Centres
(RLDC) are the bodies in charge of the daily management of local grids. Their operations are overseen by the National Load
Dispatch Centre (NLDC), set up in 2009. Government-controlled company PowerGrid is in charge of granting Long-Term
Access (LTA) to private power producers. To facilitate the long-distance transfer of power generated from IPP projects,
PowerGrid will build 11 High-Capacity Power Transmission Corridors, nine of which are scheduled to be completed in the XII
plan ending Mar 2017.
Power
Transmission
Corridors
The 11 High-Capacity Power Transmission Corridors will be worth an estimated INR 750bn, newswire The Hindu reported,
quoting a top PowerGrid official as saying. The company planned to raise the funds it needed through bond issues. The first
phase of a 6,000 MW sub-station in the eastern state of Odisha, part of High-Capacity Power Transmission Corridor-1
(HCPTC-1) is expected to be completed in by March 2014, a May 2013 report by the Power Ministry said. HCPTC-1 will help
bring about 10,000 MW power from Independent Power Projects (IPP) to the state and will improve its transmission capacity.
The sub-station will require some 300 acres of land in and around four villages.

- 50 -
Performance of State Power Utilities

Revenue Growth in State Power Sector
3,000
25%
2,073.47
2,500
Capital Employed by State Power Utilities
2,421.89
20%
19.89%
2,000
16.80%
1,729.48
INR 4,707.92bn
15%
304
1,500
1,000
INR 4,297.84bn
10%
9.83%
240
5%
500
0
INR 3,729.36bn
262
0%
FY 2010
FY 2011
FY 2012
Sales, INR bn
FY 2010
57
244
39
Other Loans, INR bn
% y/y Growth
FY 2011
3,811
3,285
FY 2012
Consumer Contribution,
INR bn
Grants towards Capital
Assets, INR bn
206
31
Aggregate Losses of All State Power Utilities

FY 2009
302
2,632
Loans from Financial

Institutions, Banks, Bonds,
INR bn
State Govt. Loans, INR bn
-245.96
-377.73
-304.30
Networth, INR bn
-453.82
-534.92
-516.02
-539.86
-625.81
-644.63
-742.91
448
-670.06
150
437
551
53
-318
-928.45
Aggregate Book Losses, All Utilities, INR bn

Aggregate Losses w/o Accounting for Subsidy, All Utilities, INR bn
Aggregate Losses on a Subsudy Received Basis, All Utilities, INR bn
FY 2010
Source: Power Finance Corporation Ltd.

- 51 -
FY 2011
FY 2012

Subsidies Booked and Released
400
350
300
250
200
150
100
50
0
Total Income and Energy Sold

100%
89.54%
85.42%
56.08%
340.14
258.32
202.95
190.74
226.66
FY 2010
Subsidy Booked, INR bn
% Subsidy Released
80%
2,600
60%
2,400
40%
640,000
622,504
600,000
578,698
2,000
0%
2,684.47
FY 2011
FY 2012
Total Energy Sold, GWh
AT&C Losses by Region

77%
42.61%
76%
75.39%
1,906.98
2,529.32
FY 2010
2,287.31
2,998.15
FY 2011
75.51%
2,684.47
3,555.01
34.85%
76%
38.72%
37.03%
75%
31.49%
29.22%
75%
FY 2012
24.86%
18.62%
24.47%
27%
26.04%
19.21%
Aggregate Turnover of Utilities (SEBs, Power Departments and DISCOMs) Excl. Subsidy
Booked, INR bn
Aggregate Expenditure, INR bn
Eastern
North-Eastern
Northern
FY 2011
Cost Recovery, INR bn
Source: PFC
540,000
Total Income Excl. Subsidy for Utilities Selling Directly to Consumers, INR bn
Subsidy Released, INR bn
3,000
1,000
560,000
FY 2012
76.29%
2,000
580,000
2,287.31
Cost Recovery of Utilities Selling Directly to Consumers

4,000
620,000
2,200
20%
302.42
FY 2011
2,800
- 52 -
Southern
FY 2012
Western
Total
Performance of Utilities Selling Directly to Consumers (cont'd)

Receivables and Payables of Utilities Selling to Consumers
Power Sales by Region

FY 2010
Region
Eastern
FY 2011
160
FY 2012
Revenue
Revenue
Revenue
from Sale Energy from Sale Energy from Sale Energy
of Power, Sold, GWh of Power, Sold, GWh of Power, Sold, GWh
INRbn
INRbn
INRbn
149.57
44,124
187.56
47,957
231.03
151
140
1,075.53
1,000
116
120
48,656
North-Eastern
24.8
6,116
27.52
7,010
32.55
7,664
Northern
Southern
Western
All India
509.45
489.44
556.21
1,729.48
166,530
168,116
143,420
528,086
591.91
604.6
661.87
2,073.47
184,605
176,042
163,084
578,698
686.72
684.3
787.29
2,421.89
198,005
187,026
181,153
622,504
807.02
100
100
646.41
80
800
686.07
600
504.08
60
400
40
Gap between Electricity Cost of Supply and Consumer Price
200
20
0.7
FY 2012
1.07
109
As of Mar 31, 2010
0.64
FY 2011
105
As of Mar 31, 2011
102
As of Mar 31, 2012
No of Days of Customer Receivables Outstanding, (l)

0.94
No of Days of Payables for Purchase of Power, (l)

0.4
FY 2010
Total Receivables for Sale of Power of Utilities Selling Directly to

Consumers, INR bn, (r)
Total Payables for Purchase of Power of Utilities Selling Directly
to Consumers, INR bn, (r)
0.87
Gap with Subsidy, INR/KWh
Gap w/o Subsidy, INR/KWh
Source: PFC
1,200
1,077.50
- 53 -
Power Exchange and Trading

Price of Electricity Transacted
The Electricity Act of 2003 recognised power trading as a new
segment apart from generation, transmission and distribution.
Inter-state trading in electricity started in 2004. The two power
exchanges, IEX and PXIL, started operations in Jun 2008 and
Oct 2008, respectively. The number of CERC-licensed traders
rose to 56 in FY 2012 from 13 in FY 2005. A total 13.79 TWh
were traded through IEX and 1.03 TWh through PXIL in FY
2012.
Although unscheduled interchange (UI) is not a market
mechanism, electricity transacted under UI is considered part of
short-term transactions, as is electricity transacted directly
between distribution companies, without involving trading
licensees or power exchanges.
In FY 2013, the volume of UI transactions was 24.76 TWh and
that of transactions directly between distribution companies 14.52 TWh (see tables on next slide).
Developments expected to lead to further growth in power
trading in the future include open access to consumers,
increased share of merchant power from independent power
plants, establishment of distribution franchisees and supply of
power to investment-promoting projects such as the Special
Economic Zones (SEZs).
Rising competition among power exchange players reduces
trade margins. Independent power producers are selling below
their estimates, as, when faced with a deficit, power distribution
companies prefer load shedding to buying market-priced
electricity and thus increasing their expenses. In spite of the
Electricity Act provisions, open access is only slowly granted to
consumers, which is a further barrier to growth and competition
in the sector.
7.29 7.49
5.26 4.96
4.79
3.47
FY 2009
FY 2010
FY 2011
4.18
4.33
3.57
3.67
FY 2012
FY 2013
Price of Electricity Transacted Through Traders, INR/kWh

Price of Electricity Transacted Through Power Exchanges, INR/kWh
Short-Term Transactions by Participants, FY 2013

Long-term
transactions
accounted for
89% of all
power trading
transactions in
FY 2013. ShortTerm
transactions
were 11% of the
total.
Bilateral Through
Traders 36.5%
Power Exchange
Transactions
23.8%
UI Transactions
25.0%
Bilateral Between
Distribution
Companies 14.7%
Source: Central Electricity Regulatory Commission (CERC), Tata Power, NTPC

- 54 -
Power Exchange and Trading (cont'd)

Electricity Transacted by Trading Licensees, Sept 2013
Volume and Price of Electricity Transacted Through UI

Volume of UI
Transactions,
TWh
Volume of ShortVolume of UI as
Term
% of Short-Term
Transactions,
Transactions
TWh
UI Price
(INR/kWh)
FY 2010
25.81
65.9
39%
4.62
FY 2011
28.08
81.56
34%
3.91
FY 2012
27.76
94.51
29%
4.09
FY 2013
24.76
98.94
25%
3.86
Volume of Electricity Transacted Directly Between Discoms

Volume of Electricity
Volume of Direct
Volume of ShortTransacted Directly
Bilateral Transations
Term Transactions,
Between Distribution
as % of Short-Term
TWh
Companies, TWh
Transactions
FY 2010
6.19
65.9
9%
FY 2011
10.25
81.56
13%
FY 2012
15.37
94.51
16%
FY 2013
14.52
98.94
15%
Source: CERC, CEA

- 55 -
Name of the Trading Licensee
PTC India Ltd.
33.87%
Tata Power Trading Company Ltd.
14.79%
JSW Power Trading Company Ltd.
12.68%
Shree Cement Ltd.
6.21%
Reliance Energy Trading Ltd.
4.76%
Jaiprakash Associates Ltd.
4.67%
Mittal Processors Ltd.
4.31%
Adani Enterprises Ltd.
3.36%
Knowledge Infrastructure Systems Ltd.
3.13%
NTPC Vidyut Vyapar Nigam Ltd.
2.75%
Manikaran Power Ltd.
1.78%
GMR Energy Trading Ltd.
1.70%
National Energy Trading & Services Ltd.
1.46%
Instinct Infra & Power Ltd.
1.30%
RPG Power Trading Company Ltd.
1.27%
Essar Electric Power Development Corp. Ltd.
0.77%
Arunachal Pradesh Power Corporation Ltd.
0.73%
Pune Power Development Ltd.
0.33%
Customised Energy Solutions India Ltd.
0.12%
Ambitious Power Trading Company Ltd.
0.02%
Total
100.00%
Top 5 trading licensees
72.30%
VI. Water Supply and Sanitation (WSS)
Indias fiscal year runs from Apr 1 to March 31. Thus, FY 2012 (also called fiscal 2012) means Apr 1, 2011 Mar 31, 2012. In Indian documents, FY (fiscal) 2012 is also labeled FY11-12.
Indian fiscal year 2013 ends in March 2013 and the remaining nine months of calendar 2013 belong to fiscal year 2014.
In order to better align with calendar years and make international comparisons more meaningful, Emerging Markets Insight has chosen to label data by the year in which most of the result
occurred. Unless otherwise stated, in graphs throughout this report, 2011, for example, means the 12 months between Apr 1, 2011 - Mar 31, 2012, or what in India is referred to as fiscal 2012.

- 56 -
Water Supply and Sanitation (WSS) Highlights
Top Priority
India's rapid economic growth and urbanisation are widening the demand/supply gap of water and managing the countrys
water resources rationally and sustainably is one of the government of India's priorities for the 12th Planning Period (20122017).
Scarcity
According to the Asian Development Bank, per capita water availability is expected to fall to 1,140 cu m by 2050 from 1,588 cu
m in 2010 and 5,200 cu m in 1951. India's current water consumption is roughly in line with its availability, but by 2030, water
consumption is estimated to be 100% higher than the water available, the deputy chairman of the Indian Planning Commission,
Montek Singh Ahluwalia, was quoted as saying. The uneven distribution of water resources, both geographically and
seasonally, aggravates the problem.
Intermittent
Supply
According to the World Bank, more than 90% of India's urban population has access to drinking water, and more than 60% of
the population has access to basic sanitation. However, less than 50% of the urban population has access to piped water. No
Indian city receives piped water 24 hours a day, 7 days a week. Utility companies provide piped water for never more than a
few hours per day, regardless of the quantity available. The government urges power generators to reduce fresh water
consumption in plants under the Reduce, Reuse & Recycle principle.
Water Losses
The World Bank estimates Non Revenue Water (NRW), unaccounted for due to leakages, unauthorised connections and billing
and collection inefficiencies, at some 40% to 70% of the water distributed. Operations and maintenance (O&M) cost recovery
through user charges is at about 30% to 40%. Most urban water utilities survive on operating subsidies and capital grants.

- 57 -
Water Utilities in India

Indian Water Utilities Performance Trend
1,200
1,000
858
819
1,140
15.22%
990
930
Indian Water Utilities Industry Volume

16%
800
14%
800
8.36%
8%
6.49%
400
740
6%
4.69%
0%
FY 2008
FY 2009
FY 2010
FY 2011
Indian Water Utilities Turnover, INR bn
1,469
1,500
1,140
1,214
9.98%
1,335
10.01%
10.09%
1,783
10.29%
1,000
12%
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
Indian Water Utilities Industry Turnover Forecast, INR bn
FY 2010
FY 2011
FY 2012
% y/y change
1.95%
822
840
820
800
853
1.97%
860
10%
806
2%
760
0%
740
% y/y change
1.90%
1.86%
1.84%
1.85%
1.80%
1.75%
FY 2013
FY 2014
FY 2015
FY 2016
Indian Water Utilities Industry Volume Forecast, INR bn
- 58 -
2.00%
1.95%
1.90%
791
FY 2012
FY 2017
869
838
780
Source: Marketline
0%
FY 2009
880
4%
1%
Indian Water Utilities Industry Volume Forecast
6%
500
1%
Indian Water Utilities Industry Volume, bn cu m
8%
6.45%
2%
728
FY 2008
% y/y change
1,617
1.63%
744
680
FY 2012
Indian Water Utilities Industry Turnover Forecast

2,000
2%
700
2%
2.22%
720
4%
200
773
761
760
10%
600
2.24%
780
12%
3%
791
2.24%
FY 2017
% y/y change
Urban Water and Sewage Highlights
Sewage
Upgrade
As of January 2012, most Indian cities did not have sewage treatment plants for biological and chemical waste, the Planning
Commission said in a report. Technologies used are not adapted to treating chemical waste or operating within a limited
capacity of the receiving environment to assimilate treated waste. Sewage technology issues include price of capital, availability
of land and operation and maintenance costs. The increasing pollution of the receiving environment highlights the need for
more advanced and expensive sewage technologies.
Upgrade Costs
Tertiary treatment plants, capable of cleaning water for reuse in households and industries are being built in India, but are
expensive. According to the Planning Commission, cities can partially recover construction costs by restricting freshwater use
and promoting the sale and use of treated sewage water. Companies that build their own pipelines and connect them to the
citys sewage treatment plants can recover their costs by buying treated water at a lower price than the industrial tariff.
Public-Private
Partnerships
Current models of public-private water partnerships include concessions for treatment plants and service contracts for billing,
tariff collection and metering. Most projects are publicly funded and focus on distribution improvement by employing the
managerial and technical expertise of private companies. Examples of cities with privately-run citywide distribution include
Jamshedpur, where a company of industrial conglomerate Tata Group has set up a water supply system, and Tirupur where a
public-private company is in charge of water distribution.
Attracting
Private Capital
The Planning Commission believes that the role of private companies in water distribution and sewage treatment must be
encouraged. The current experience, however, is that the private sector is reluctant to engage in capital and operational
investments. In order to promote private participation, city authorities will have to better consider the financial sustainability of
projects, keep accurate base-line data on water and sewage, provide correct project designs and relax procedures for
renegotiating of tendered agreements in case of an inaccuracy significantly altering the performance or financial scopes of
projects.

- 59 -
Water Supply
Per Capita Water Availability in India (cu m/per year)
5,500
5,000
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
5,177
2,200
1,869
Water Stress
1,341
1,140
2015
2050
Water Scarcity
1951
1991
2001
Per Capita Water Availability in India (cu m/per year)
Water Resources by Source and Consumers

Utilizable Water Resources in
India (Publ. Oct 2011)
Ground
Water
(GW),
BCM,
433
Water Utilities by Major

Consuming Sectors, FY 2012,
%
Households
38.40%
Total:
1,123
BCM
Surface
Water
(SW),
BCM,
690
Agriculture
59.70%
Industry
1.90%
Source: Ministry of Water Resources, Asian Development Bank

- 60 -
Water availability in India is very unevenly distributed, with

75%-80% of precipitation falling during the monsoon
season from July to September. This, coupled with Indias
billion-strong population and increasing household and
industrial demand, is the major cause for water scarcity in
the country.
Because of India's rapid population growth, annual per
capita water availability is declining and is forecast at just
about the water stress line in 2015.
According to the Indian Planning Commission, the
drinking water requirements of most big cities in the
country are generally met with a combination of
groundwater (75%) and surface water supply (25%)
from nearby irrigation/multi-purpose reservoir schemes.
India's average annual water resource potential, meaning
the total runoff generated from rainfall, is estimated at
1,869 billion cubic meters (BCM), the Asian
Development Bank said.
Utilisable water resources are assessed at 1,123 BCM
and include water that can be utilised economically within
the
limitations of the technology available, the
physiographic, hydrological and socio-political conditions,
as well as the existing environmental, legal and
constitutional constraints.
Water Supply and Sewage

Central Government Investment in Water and Sewage
Period (FY)
INR bn
Central Assistance for Water and Sewage
1980-2005
37
Central Assistance for River Conservation
1995-2010
50
Central Assistance under JNNURM (urban renewal mission)
2005-2011
430
Improving water and utility management and ensuring

equal supply to all is Indias main urban water objective
the XII plan (fiscal 2012-17), according to a Jan 2012
report by the Planning Commissions body on water
resources and sanitation.
Water utilities are mostly run by cities and municipalities,
making Indias water supply network very fragmented.
Water utilities comprise the following legal forms:
municipal council, municipal corporation, private
company, city board and autonomous local body.
In most cities, water is supplied from distant sources.
Long pipelines result in higher leakage and losses, which
the Planning Commission estimated at some 50% of the
water that enters pipes. Electricity makes up 40%-60% of
water supply costs.
Pipes are distributed unevenly in cities, with some parts
getting nearly all the water and other parts getting none.
City water agencies have no records of the amount of
groundwater which is privately extracted in cities.
Cities keep no national accounts on the load of sewage
generated because of the different ways in which people
source water and dispose of sewage. According to the
Planning Commission, India treats 30% of the sewage it
generates, with the cities of Delhi and Mumbai claiming
40% of the countrys installed capacity.
Types of PPP Contracts in Water Supply and Sewage
Management Contract
Service Contract
Design-Build-Operate Contract (DBO)
Long-Term Lease
Build-Own-Operate Contract (BOO)
Build-Operate-Transfer (BOT) Variations: Build-Transfer-Operate
(BTO), Build-Rehabilitate-Operate-Transfer (BROT), Build-LeaseTransfer (BLT), Build-Own-Operate-Transfer (BOOT)
Source: Planning Commission, JNNURM, World Resources Institute

- 61 -
VII. City Gas Distribution (CGD)

- 62 -
City Gas Distribution (CGD) Highlights
Natural Gas
Overview
Indian natural gas production was 1.4% of global production in 2011, down from 1.6% in the previous year. Domestic natural
gas consumption accounted for 1.9% of global consumption in 2011. With a share of 9%, natural gas is India's fourth energy
source, after coal with 58.3%, hydro with 39.5% and RES 12.32%, respectively. Natural gas held a 10% share in India's
installed capacity in FY 2012. About a fifth of natural gas demand is currently met by imports. It is expected that the share of
natural gas in the countrys energy basket will grow to 20% by 2025.
City Gas
Distribution
Gas requires expensive infrastructure and complex pipeline networks to ensure constant flow. As of March 2012, India was
home to gas pipelines of a total length of 13,428 km, 70% of which were operated by public gas transporter and marketer GAIL.
City gas distribution was available in 43 geographical areas and consumed some 14 MMSCMD of gas, of which 6.63
MMSCMD is from re-gasified liquefied natural gas (RLNG), according to the government's Economic Survey for FY 2013.
PNG/CNG
City gas projects based on PNG/CNG started operations in the early 1990s in Delhi and Mumbai. Piped Natural Gas (PNG), in
this context also termed "cooking gas" is for household and commercial usage, and Compressed Natural Gas (CNG) is used as
transportation fuel. Before the government's Oil Sector Vision 2015 was adopted in 2009, PNG/CNG was available in 35 cities,
reached 860,000 households and was used by 500,000 vehicles. By 2015, a total 200 cities are envisaged to be covered. India
had some 1.6 million PNG connections in mid-2012.
LPG
In its Oil Vision 2015, the government pledged to secure 55 million new connections to raise population coverage from 50% to
75%. The total number of LPG customers is thus set to reach 160 million, with most of the newly joined households coming
from rural India. The government vowed to provide 100% LPG coverage to all towns with a population of more than 500,000.
Portability of LPG connections, similar to that for mobile phone numbers, is also on the agenda.

- 63 -
PNG in India
Piped Natural Gas Status as of Mar 31, 2013
State
City Covered
Company
Domestic PNG
Commercial PNG
Industrial PNG
Delhi
Delhi, Noida, Greater Noida, Ghaziabad
IGL
386,226
962
418
Maharashtra
Mumbai, Thane, Mira-Bhayandar, Navi Mumbai, Pune,

Kalyan, Ambernath, Panvel, Bhiwandi
MGL, MNGL
647,790
1,990
98
Gujarat
Ahmedabad, Baroda, Surat, Ankeleshwar
GSPC, SABARMATI GAS, GUJRAT GAS,

HPCL, VMSS,ADANI GAS
1,144,424
12,693
3,686
Uttar Pradesh
Agra, Kanpur, Bareilly, Lucknow
Green Gas Ltd. (Lucknow),

CUGL(Kanpur)
7,090
55
430
Tripura
Agartala
TNGCL
11,431
256
41
Madhya Pradesh
Dewas, Indore, Ujjain, Gwalior
GAIL GAS, AGL
1,775
49
Rajasthan
Kota
GAIL GAS
177
16
Assam
Tinsukia, Dibrugarh, Sibsagar, Jorhat
ASSAM GAS CO. LTD
23,632
759
366
Andhra Pradesh
Kakinada, Hyderabad, Vijaywada, Rajamundry
BGL
1,802
15
Haryana
Sonepat, Gurgaon, Faridabad
GAIL GAS, ADANI GAS, HARYANA CITY

GAS
11,508
43
123
2,235,855
16,779
5,228
TOTAL
Source: PPAC
- 64 -
CNG Sales, Stations and Vehicles

CNG Sales as of Mar 31, 2013
CNG Stations and Vehicles as of Mar 31, 2012

FY 2013
(Prov.),
thou
tonnes
State
Company Name
No of CNG
Stations
No of CNG
Vehicles,
mln
Gujarat
GAIL Gas/ Adani Energy/ Gujrat

Gas,GSPC, GGCL, SGL,HPCL
313
638,422
Delhi / NCR
Indraprastha Gas (IGL) New Delhi
286
654,158
Maharashtra
Mahanagar Gas Ltd.(MGL) Mumbai,

MNGL Pune.
203
334,810
29
19,958
State
Company Name
FY 2012,
thou tonnes
Gujarat
GAIL Gas/ Adani Energy/ Gujrat

Gas,GSPC, GGCL, SGL,HPCL
409.1
441.8
Delhi
Indraprastha Gas (IGL) New Delhi
649.3
695.1
Rajasthan
(Kota)
GAIL
0.2
0.8
Maharashtra
Mahanagar Gas Ltd.(MGL) Mumbai,

MNGL Pune.
382.8
425.1
Andhra Pradesh
Bhagyanagar Gas Ltd.( BGL)

Hyderabad.
15.8
24.7
U.P.

CUGL(Kanpur)
112.6
137.7
Tripura
Tripura Natural Gas Co. Ltd.(TNGCL)

Agartala.
3.2
4.3
M.P.
Avantika Gas (Indore) / GAIL Gas Ltd.
10.7
Haryana
Haryana City Gas Ltd.
West Bengal
GEECL
Total
Andhra Pradesh Bhagyanagar Gas Ltd.( BGL) Hyderabad.

Rajasthan
Gail Gas.
1,085
U.P.

CUGL(Kanpur)
30
56,857
Tripura
Tripura Natural Gas Co. Ltd.(TNGCL)

Agartala.
4,682
14.5
M.P.
Avantika Gas (Indore) / GAIL Gas Ltd.
16
10,878
54
73.2
Haryana
Haryana City Gas Ltd.
14
85,560
0.6
West Bengal
GEECL
1,201
1,637.7
1,817.8
All India
903
1,807,611
Source: Petroleum Planning and Analysis Cell (PPAC)

- 65 -
VIII. Major Players

- 66 -
Top M&A Deals

Top M&A Deals in the Indian Utilities Sector in 2013
Date
Target Company
Deal Type
Buyer
Seller
Deal Value USD (mn)
Stake %
Sep 11, 2013
Transmission and distribution (T&D)

business of Vijai Electricals Ltd
Acquisition
Toshiba Corporation
Vijai Electricals Ltd
200
N/A
Mar 4, 2013
Gujarat Gas Company Ltd
Tender Offer
Gujarat State Petroleum Corp (GSPC)
Minority Shareholders
62.46
8.58%
Goldman Sachs Capital Partners
N/A
135
N/A
Jul 5, 2013
150MW Gujarat wind mill project
Minority stake
purchase; PE Entry
Acquisition
Apr 8, 2013
Wind power facility of VRL Logistics
Acquisition
Jul 30, 2013
110 MW Chuzachen Hydro-Electric

Project in East Sikkim
Jun 5, 2013
ReNew Wind Power Pvt Ltd
Minority Stake Purchase
Bharat Light and Power Pvt Ltd
DLF Ltd.
53.41
100.00%
Amplus Infrastructure Developers Pvt Ltd
VRL Logistics Ltd
42.15
100.00%
GE Energy Financial Services
Gati Infrastructure Private

Limited
43.29
21.63%
N/A
60
N/A
Asia Clean Energy Ltd., DEG Investitions und

Entwicklungsgesellschaft mbH, FE Clean Energy
Group Inc., GS Power Co.Ltd., International Finance
Corp (IFC), Proparco - Societe de Promotion et de
Participation pour la Cooperation Economique SA
Apr 23, 2013
NSL Renewable Power Pvt Ltd
Minority stake
purchase; PE Entry
Oct 9, 2013
AES Saurashtra Windfarms Pvt Ltd
Acquisition
Tata Power Company Ltd
AES Corp
24.4
100.00%
Apr 4, 2013
Tamil Nadu wind mill of DLF
Acquisition
Tulip Renewable Powertech Pvt Ltd
DLF Ltd
34.62
N/A
Nov 15, 2013
Dans Energy Consulting Pvt Ltd
Minority Stake Purchase
Equis Funds, Singapore
N/A
18.96
N/A
18.64
33.96%
8.62
N/A
10.9
N/A
2.39
100.00%
Jan 23, 2013
Bharat Light and Power Pvt Ltd
Jun 13, 2013
Atria Brindavan Power
Apr 4, 2013
Rajasthan wind mill of DLF
Sep 15, 2013
Kudgi Transmission Ltd
Oct 30, 2013
5.7 MW hydro plant in Uttarakhand
Minority stake
Draper Fisher Jurvetson Venture Capital, UTI Capital
purchase; PE Entry, VC
N/A
Pvt Ltd, VenturEast,
Entry
Minority stake
BanyanTree Finance Pvt Ltd
N/A
purchase; PE Entry
Acquisition
Violet Green Power Pvt Ltd
DLF Ltd
L&T Infrastructure Development Projects Ltd (L&TAcquisition
Rural Electrification Corp Ltd
IDPL)
Acquisition
Pan Global Corp
Regency Yamuna Energy Ltd
6.6
100.00%
N/A
100.00%
N/A
100.00%
Aug 30, 2013
Vizag Transmission Ltd
Acquisition
Power Grid Corpn. of India Ltd
REC Transmission Projects

Co Ltd
Aug 26, 2013
Two wind farms in Madhya Pradesh
Acquisition
Continuum Wind Energy
Sravanthi Group
Source: DealWatch
- 67 -
Possible M&A Activity in Utilities

Companies Looking to Buy
Companies Looking to Sell
Tata Power Co Ltd is evaluating renewable energy projects totaling over

2,800 MW for acquisition, the Business Line reported on December 2,
2013. In October, the company had acquired a 39-MW wind farm in
Gujarat.
Jindal Steel and Power (JSPL) will acquire a majority stake of 53.63%
in Gujarat NRE Coke's loss-making Australian subsidiary through a
complex deal, which involves issue of convertible notes, placement of
shares and option to acquire shares at a later stage, the Financial Express
reported on October 28, 2013. The deal, announced in September, was
cleared on October 27, 2013 by the shareholders of Gujarat NRE Coking
Coal, which is the Australian subsidiary of Kolkata-based Gujarat NRE
Coke.
Public sector company SJVN Ltd. may acquire two hydro electric projects
owned by Jaypee Group if the later goes for open bidding, the Hindu
reported on September 16, 2013. SJVN Chairman and Managing Director
R. P. Singh said the private sector company was selling two of its major
hydro projects, the 1,000 MW Karcham Wangtoo and 300 MW Baspa
hydro electric projects, to square off some of its debts. The Jaypee Group
is believed to be in touch with many players including the UAE
Government-owned Abu Dhabi Water and Electric Authority (ADWEA) and
might choose not to go for an open international bidding.
State-owned NHPC was in the process of buying back its shares worth up
to INR 23.68bn between November 29 and December 12, Business Today
reported. The company was to buy back 123,00,74,277 fully paid-up equity
shares of INR 10 each at a price of INR 19.25 per share, which
represented 8.89% of its total paid-up equity share capital and free
reserves as of June 30, 2013. Prior to the buyback, the government held
86.36% in NHPC.
Essar Energy, the India-focused and London-listed oil, gas and power arm
of the Essar group, will be divesting its exploration and production (E&P)
assets globally to raise funds for further growth, the Financial Express
reported on November 26, 2013. Essar Energy CEO Sushil Maroo did not
give any deadline for completing the process or the amount that the
company would raise, but alluded to the fact that Essar Energy would look
at exiting most of its non-core or non-performing assets in the near future.
On Nov 7, 2013, the Indian government approved a secondary share sale
of PowerGrid Corp., open from Dec 3 to Dec 5 for institutional buyers and
to Dec 6 for retail investors, the Economic Times of India reported.
PowerGrids follow-on public offer (FPO) got subscribed 0.06 times on day
1 and 1.06, 4.77 and 6.74 times on days 2, 3 and 4 respectively. The offer
included a government disinvestment of 4% and the sale of 601.9 million
new shares, equivalent to 13% of the existing paid-up capital. Post-issue,
the governments holding in PowerGrid came down to 57.89% from
69.42%. The shares were offered at INR 85-90 per share and could fetch
around INR 70.83bn at the upper end of the price range. The company
may raise some INR 57.17bn, while the government may receive some
INR 17.58bn. PowerGrids IPO was held in October 2007. The
government has set a target to raise some INR 400bn from disinvestment
in the current fiscal year, ending Mar 31, 2014.
The Jaypee Group is in talks with Abu Dhabi National Energy
Company PJSC (TAQA) to sell its hydro-power projects, Business Line
reported on September 17, 2013. Earlier in September, the group, whose
interests range from engineering and construction to cement and sports,
sold its Gujarat cement unit for INR 38bn to UltraTech Cement of the
Aditya Birla Group.
Source: Local media

- 68 -
Liquidity and Solvency Ratios of Major Players

Liquidity Ratios of Major Players
Cash Flow/Earnings Index of Major Players
PowerGrid
NTPC
NHPC
Tata Power
GAIL
Current Ratio
2012
0.43
1.82
1.91
0.83
1.01
Current Ratio
2011
0.56
2.17
1.76
1.33
0.86
Acid Test 2012
0.22
1.06
1.24
0.43
0.55
Acid Test 2011
2.68
4.05
4.05
2.62
1.49
Cash Ratio 2012
0.13
0.82
0.92
0.15
0.27
Cash Ratio 2011
0.22
1.03
0.92
0.43
0.13
Solvency Ratios of Major Players

NTPC
NHPC
Tata Power
GAIL
Debt-to-Assets
2012
61.36%
36.09%
34.18%
35.84%
20.28%
Debt-to-Assets
2011
59.2%
35.7%
33.44%
31.65%
14.79%
Debt-to-Capital
2012
72.21%
41.97%
40.09%
44.53%
27.22%
69.45%
40.69%
40.10%
39.47%
19.82%
259.87%
72.33%
66.91%
80.29%
37.41%
227.36
68.6%
66.94%
65.20%
24.72%
NHPC
Tata Power
GAIL
Cash
Flow/Earnings
Index 2012
2.61
1.23
0.81
0.42
1.25
Cash
Flow/Earnings
Index 2011
1.97
1.16
0.75
0.56
1.23
Liquidity, measured by the current ratio, improved for GAIL and NHPC and
worsened for the other three observed companies in 2012. The quick ratio
reflects the y/y increase in current liabilities, observed in all companies
except NHPC, and the decrease or non-proportional increase in cash and
receivables. The cash ratio shows that NTPC and NHPC had more cash
relative to current liabilities compared to the other three companies.
Solvency weakened for all five observed companies. The three solvency
ratios were similar for the three power generators NHPC, NTPC and Tata
Power, and widely different for the other two companies, active in electricity
and gas transmission and distribution, respectively.
A Cash Flow/Earnings Index of 1.0 would indicate parity between a
companys net operating cash flows and net income. An index below 1.0
could be a sign of high levels of debt financing.
Source: Company data, EMIS Insight calculations

NTPC
Comments
PowerGrid
Debt-to-Capital
2011
Debt-to-Equity
2012
Debt-to-Equity
2011
PowerGrid
- 69 -
GAIL India Ltd.

Financial Performance
Highlights
Gail India Ltd., headquartered in New Delhi, is the largest
state-owned gas transporter and marketer in India. The
company is active in the following segments: transmission
of natural gas and LPG, natural gas trading, production of
petrochemicals, LPG and liquid hydrocarbons, and
telecommunications.
GAIL, formerly known as the Gas Authority of India Ltd.,
was set up in 1984 to create gas infrastructure in the
country. GAIL began city gas distribution in New Delhi in
1997. GAIL Gas Ltd. is a wholly-owned subsidiary of GAIL,
set up in 2008, to manage its PNG/CNG business.
As of March 31, 2013, GAIL held some 60% market share
in gas marketing in India. The company claimed 75% in the
gas transmission business in the country.
GAIL is the only company in India, which owns and
operates LPG transmission pipelines for third-party usage.
The company has seven LPG plants in the country which
produced a total 1.38 million tonnes of liquid hydrocarbons
between April 1, 2012 and March 31, 2013.
In the Exploration and Production (E&P) segment, the
company has been awarded exploration rights for a total 32
blocks, 30 of which in India and two overseas.
GAIL has international presence, including stakes in JV
companies, wholly-owned subsidiaries and representative
offices, in China, Egypt, Myanmar, Singapore and the
United States.
480
408
329
254
244
46 31
42 28
2008
2009
Gross Sales, INR bn
52 36
2010
Profit Before Tax, INR bn
53 37
2011
61 40
2012
Profit After Tax, INR bn
Physical Performance by Segments

Unit
2011
2012
Natural Gas Throughput
mmscmd
117.62
104.90
Natural gas Trading
mmscmd
84.17
81.44
Liquid Hydrocarbon Sales
thou tonnes
1,441
1,371
Polymer Sales
thou tonnes
448
427
LPG Transported
thou tonnes
3,362
3,136
Source: Company data

- 70 -
GAIL India Ltd. (cont'd)

Five-Year Gas Throughput/Production Overview
Highlights
Unit
2008
2009
2010
2011
2012
Natural Gas
MMSCMD
83.29
106.73
117.62
117.91
104.9
LPG
M/T
(metric tonnes)
SBP
Solvent/Naphtha
M/T
101,493
102,479
111,140
146,123
147,988
Pentane
M/T
58,392
58,551
34,523
23,144
20,739
Propane
M/T
152,671
179,274
155,152
146,015
129,570
Ethylene
M/T
431,580
429,992
428,444
457,080
448,534
HDPE/LLDPE
M/T
420,108
417,147
416,396
441,136
441,051
Its wholly-owned subsidiary GAILTEL operates in

bandwidth and infrastructure leasing.
GAIL moved from being a captive renewable energy
producer to being a commercial producer, after launching
some 100 MW of wind energy projects in 2011. In its
annual report, the company announced plans to further
expand its wind and solar energy portfolio.
GAIL is one of the three upstream companies that share
the under-recoveries of Oil Marketing Companies (OMCs)
by selling them petroleum products at a discount. In an
effort to make LPG affordable to domestic consumers, the
company has contributed a total INR 165.19bn since 2003.
GAILs contribution to OMCs under-recovery burden
totalled INR 26.87bn in 2012, slightly down from INR
31.83bn in the previous year.
The gas transporter and marketer is listed on both Indian
stock exchanges as well as on the London Stock
Exchange.
GAIL's operating cash flows were not sufficient to finance
investments in 2011 and 2012. Long-term borrowing
increased in 2012 compared to 2011. Unlike in 2011, in
2012 GAIL took on short-term debt. Cash increased by INR
14.27bn in 2012 compared to a net decrease of INR 12bn
in the previous year.
1,087,986 1,099,554 1,068,156 1,124,341 1,077,866
Statement of Cash Flows

2011,
INRbn
2012,
INRbn
Cash Flow from Operating Activities
44.88
50.33
Cash Flow from Investing Activities
-71.42
-54.72
Cash Flow from Financing Activities
14.54
18.65
Net Increase/Decrease in Cash and Cash Equivalents
-12.00
14.27
Cash and Cash Equivalents at the Beginning of the

Year
21.31
9.31
Cash and Cash Equivalents at the End of the Year
9.31
23.58

- 71 -
NHPC Ltd.
Highlights
55.10
42.19
40.47
27.72
26.72
10.75
2009
Sales, INR bn
8.61
7.38
6.77
3.25
23.48
21.67
20.91
2008
NHPC Ltd. is a hydropower generating company based in

Faridabad in the state of Haryana. As of Mar 31, 2012, the
government of India controlled 86.36% in the company.
NHPC, which is listed on both the Bombay and National Stock
Exchanges, had a total five subsidiaries and joint venture
companies in 2012. The utility was awarded a Miniratna status in
2008.
NHPC, set up in 1975, operated 16 power stations with an
installed capacity of 4,227 MW as of March 31, 2013. In addition,
it operated two power stations of its subsidiary, NHDC Ltd., with
an installed capacity of 1,520 MW. As of Mar 31, 2012, the
company had a 14.55% share of Indias installed hydroelectric
power capacity (5.75 GW out of 39.5 GW).
NHPC launched the 231-MW Chamera-III hydro project in
Himachal Pradesh in Jul 2012, the 44-MW Chutak project in
Jammu & Kashmir in Jan 2013 and the 132-MW Teesta Low Dam
III HEP project in West Bengal in May 2013. In addition, all the
three units of the 45-MW Nimmo Bazgo project were launched at
partial load.
Six hydropower projects with an installed capacity of 4,050 MW
were under construction at the end of the companys most recent
completed financial year in March 2013. Two of these projects,
the 760-MW Uri-II and Parbati-III were in advanced stages of
completion.
NHPC has also been working on capacity additions of 3,686 MW
to be developed through JVs with central and state utilities.
Net cash from operations decreased in 2012 (see next slide) but
was sufficient to cover the companys investments. The company
took on less debt compared to 2011 but repaid more, resulting in
negative cash from financing activities. The company reported
lower ending cash and increased borrowing in 2012 compared to
2011.
50.49
2010
Net Profit, INR bn
2011
7.38
2012
Dividend Proposed/Paid, INR bn
Power Generation Overview

18,604 18,683 18,923
16,689 16,960
14,813
9,863
2002
11,046 11,286
2003
2004
12,567 13,049
2005
2006
2007
2008
2009
2010
2011
2012
Power Generation, GWh

- 72 -
NHPC Ltd. (cont'd)

NHPC Borrowings

176.41
122.34
138.68
2004
71.67
2005
2007
2008
2009
2010
18.98
20.84
-12.95
-19.76
-9.91
5.45
Net Increase/Decrease in Cash and

Cash Equivalents
-3.88
6.54
Cash and Cash Equivalents at the

Beginning of the Year
60.04
53.5

End of the Year
56.16
60.04
Net Cash (Used in) Investing

Activities
Net Cash Flow from Financing
Activities
75.32
2006
2011, INRbn
Net Cash from Operating Activities
145.69
99.56
70.22
2012, INRbn
186.27
2011
2012
Borrowings, INR bn (include current maturities of long-term borrowings)
Other Lines of Business
Number of Employees
13,648
13,470
13,118
13,017
NHPC is registered with the World Bank, the Asian Development

Bank, the African Development Bank, the Kuwait Fund for Arab
Economic Development and the Central Water Commission as a
consultant in the area of hydropower.
The company has so far completed 84 consultancy assignments and
has 17 assignments under progress.
Apart from hydropower generation, NHPC has taken up initiatives in
solar power.
12,768
12,341
12,028
11,712
11,036
10,410
2002
2003
2004
2005
2006
2007
2008
2009
Number of Employees

11,420
- 73 -
2010
2011
2012
NTPC Ltd.
Highlights
800
NTPC Ltd, formerly called National Thermal Power

Corporation, is India's largest power utility. The Delhi-based
company, set up in 1975, is listed on both Indian stock
exchanges and was awarded a Maharatna status in 2010.
As of March 31, 2013, the utility was 75.00% owned by the
government of India.
The company's core business is engineering, construction
and operation of power plants. It also provides consultancy
services to both Indian and foreign power utilities.
As of March 31, 2012, NTPC had an installed generation
capacity of 34.82 GW, which accounted for 15.7% of India's
total installed capacity of 223 GW. Standalone coal-based
and gas-based plants had capacity of 31.9 GW and 3.96
GW, respectively. Group generation capacity was 41.18
GW in 2012, against 37 GW a year earlier. With standalone
power generation of 232.03 TWh, the company claimed a
25% share of Indias total generation in 2012.
As of March 31, 2012, NTPC had five subsidiaries and 21
joint venture companies. JVs reported a total 5.36 GW of
capacity, 3.4 GW and 1.94 GW of which were fuelled by
coal and gas, respectively.
Standalone number of employees was 23,865 in 2012
against 24,011 in 2011, and group employees were 25,484
against 25,511 in 2011, respectively.
NTPC's operating cash was sufficient to cover its
investment activities in both 2012 and 2011. Long-term
debts increased which drove ending cash up at the end of
the period. The dividends NTPC paid out accounted for
44% of net profit in 2012, compared to 40% in 2011.
679.31
645.15
700
573.99
600
492.34
452.29
500
400
300
200
82.01
100
91.03
87.28
126.19
92.24
0
2008
2009
2010
Total Revenue, INR bn
2011
2012
Net Profit, INR bn
Commercial Capacity and ESO (standalone)

34,820
40,000
35,000
30,000
27,850
28,840
25,000
205.09
29,830
206.58
30,990
215.92
10,000
215
210
206.68
205
20,000
15,000
220
200
195
193.69
190
5,000
185
180
2008
2009
Commercial Capacity , MW
2010
2011
2012
Energy Sent Out (ESO), TWh

- 74 -
NTPC Ltd. (cont'd)

Capacity and Generation by Regions, 2012
Number of Employees
Gross
Generation,
GWh
Number of Stations Fuel Type By Station
Capacity MW
4 - Coal
5,990
44,372
National Capital Region
2 - Coal; 4- Gas
4,869
29,421
Western Region
4 - Coal; 2 - Gas
12,154
71,540
Eastern Region
4 - Coal
7,900
51,670
Southern Region
2 - Coal; 1 - Liquid
Fuel
4,960
35,025
35,872
232,028
Northern Region
Total
24,011
23,865
23,797
23,743
23,639
2008
Number of Employees
NTPC Long and Short-Term Debt

700,000
502,671
600,000
133.90
500,000
400,000
345,663
377,836
132.60
160
581,457
122.60
154.95
107.10
Net Cash (Used in) Investing Activities
-140.17
-78.81
80
Net Cash Flow from Financing Activities
-7.52
-28.69
60

Cash Equivalents
7.26
-0.40

161.42
161.82
Cash and Cash Equivalents at the End of

the Year
168.68
161.42
20
0.00
2009
Long-Term Loans, INR mn
2010
2011
2012
Short-Term Loans, INR mn

Note: Figures exclude joint venture companies and

subsidiaries
40
2008
2012
2011, INRbn
100
200,000
0
2011
2012, INRbn
140
120
431,750
14.20
2010
300,000
100,000
2009
- 75 -
PowerGrid Corporation of India Ltd.

Highlights
133.29
90.99
79.02
67.01
53.24
2009
Transmission Charges, INR bn
2010
42.35
32.55
26.97
20.41
16.91
2008
95.44
75.04
61.39
PowerGrid Corporation of India Ltd. is the countrys Central

Transmission Utility (CTU) active in bulk power transmission
and in charge of operating the national and regional power
grids of India. PowerGrid also plans and supervises the
development of Indias inter-state transmission system.
The company, set up in 1989, was listed on both Indian stock
exchanges in 2007 and as of March 31, 2013 was 69.42%
controlled by the President of India. In 2008, it was awarded a
Navratna status, meaning it has the autonomy to undertake
new transmission projects of any amount without the approval
of its Board of Directors.
As of March 31, 2013 the company owned and operated a
transmission network of some 100,200 ckt km of inter-state
transmission lines and 197 EHV & HVDC substations with
transformation capacity of about 164,763 MVA.
PowerGrid had three subsidiaries and held stakes in 12 jointventure companies as of Mar 31, 2013. As of Nov 2013, it also
operated an all-India broad-band telecom network of some
29,300 km.
The company has worked as consultant and developer of
projects in Afghanistan, Bangladesh, Bhutan, Ethiopia, Nigeria,
Nepal, Kenya, Myanmar, Sri Lanka, Tajikistan and UAE.
Cash from operating and financing activities was insufficient to
cover investment both in 2011 and 2012, and the company
reported net cash decreases in both years. Borrowing
increased y/y in 2012, weakening both liquidity and solvency.
121.63
107.85
2011
Total Revenue, INR bn
2012
Net Pprofit, INR bn
Power Transmitted and Length of Transmission Lines
334,013
71,500
2008
363,723
75,290
2009
400,596
82,355
2010
430,992
92,981
2011
450,027
100,200
2012
Length of Transmission Lines, ckt km

Power Transmitted on PowerGrid network, GWh

- 76 -
PowerGrid Corporation of India Ltd. (cont'd)

Sources of Funds, %, 2012
PowerGrid Total Debt, INR bn

800
Foreign Currency
Loans 18.87%
Reserves 21.08%
700
534.02
600
Deferred Tax &
Net Current
Liabilities 7.78%
500
Equity 4.52%
Short-Term Loans
1.95%
Loans from Banks
and Financial
Institutions 1.78%
Bonds (Incl.
Foreign Currency
Bonds) 43.91%
344.17
400
284.65
300
31
26
15
22
13
631
277
2008
Cash Flow Statement
332
372
2009
2010
Total Long-Term Loans,

INR bn
2011
2012
Number of Employees (l), Sub-Stations (r)
2012, INR bn
2011, INR bn
110.46
64.03
2012
-217.11
-158.34
2011
9,670
2011
99.90
80.89
2010
9,775
2010

Cash Equivalents
-6.75
-13.43
2009

23.37
36.80

End of the Year
16.62
23.37
Net Cash (Used in) Investing

Activities
Net Cash Flow from Financing
Activities
2008
9,347
9,162
8,214
Number of Employees

Current Maturities of LongTerm Loans, INR bn
Grants 0.11%
Short-Term Loans, INR bn
491
200
100
17
408.83
681.88
20
- 77 -
2012
167
150
135
2009
124
2008
120
Number of Sub-Stations
Tata Power Ltd.

Standalone and Consolidated Financial Performance
Highlights
330.25
260.01
Tata Power, which assumed its current name in 2000, is

one of Indias leading privately-held utilities with a
significant international presence.
As of March 31, 2013, the company had an installed
generation capacity of 8,521 MW in India and a presence in
all the segments of the power sector - generation (thermal,
hydro, solar and wind), transmission, distribution and
trading. It is also a partner in a number of public-private
projects in power generation, transmission and distribution
in India.
As of March 31, 2012, Tata Power, which is listed on two
Indian stock exchanges, had a wind generation installed
capacity of 398 MW (375 MW in 2011) and plants spread
across Maharashtra, Gujarat, Tamil Nadu and Karnataka
the leading states in promoting wind power generation in
India.
Tata Powers international investments include a stake in
coal mines and a geothermal project in Indonesia; a coal
supply project in Singapore; a joint venture to develop
projects in South Africa, Botswana and Namibia; an
investment in geothermal and clean coal technologies in
Australia; and a hydro project in partnership with The Royal
Government of Bhutan.
As of March 31, 2013, Tata Power owned 23 subsidiaries
(14 wholly owned), 26 joint venture companies and 10
associates. Including major subsidiaries, the company
employed 4,830 people, against 4,709 a year earlier.
95.67
84.96
11.70
10.25
0.99
-9.68
2011
2012
2011
Standalone
2012
Consolidated
Revenue from Operations (Net of Excise Duty), INR bn
Net Profit, INR bn
Ten-Year Standalone Generation, Net Profit Overview

18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
14,717 14,807
13,746 14,269
12,917 13,283
8.7
5.51
5.09
6.11
9.22
15,946 15,325 15,230 15,770

11.7
14
10.25
10
9.39
9.41
12
8
6.97
6
4
2
0
2003
2004
2005
2006
2007
Generation, GWh, (l)
2008
2009
2010
2011
2012
Net Profit, INR bn (r)

- 78 -
Tata Power Ltd. (cont'd)

Installed Capacity of the Tata Power Group of Companies
Fuel Source
Thermal
Coal/Oil/Gas
Thermal
Waste Heat Recovery
Hydro
Location
State
Installed
Capacity
MW
Mundra
Maharashtra
4,000
Trombay
Jharkhand
1,580
Maithon
Gujarat
1,050
Jojobera
Jharkhand
428
IEL Jojobera
Jharkhand
120
Rithala
New Delhi
108
Belgaum
Karnataka
81
Lodhivali
Maharashtra
40
IEL Jojobera
Jharkhand
120
Haldia
West Bengal
120
Bhira
Maharashtra
300
Khopoli
Maharashtra
75
Bhivpuri
Maharashtra
72
Wind farms
Maharashtra,
Gujarat,
Karnataka, Tamil
Nadu
398
Maharashtra,
Gujarat
28
Renewables
Solar Photovoltaic (PV)
Total
Tata Power Group of Companies - Other Businesses
Total
Capacity by
Category,
MW
Business
Transmission
7,407
Distribution
Mumbai
Over 1,110 ckm of transmission lines, connecting

generating stations to 19 receiving stations.
Installed transmission lines which transmit surplus

Eastern/North power from the Eastern/North Eastern region
Eastern Regions (Siliguri) to Uttar Pradesh (Mandaula), covering a
distance of 1,166 km.
Mumbai
Over 2,500 ckm of distribution lines.
New Delhi
Over 10,500 ckm of distribution lines.
Mumbai
Retail
447
8,521

Details
240
427
Location
- 79 -
Over 380,000 customers with sales of over 6,500

MUs in FY13, emerging as the largest Distribution
Company in Mumbai.
New Delhi
Over 1.3 million customers with sales of over

7,760 MUs in FY13.
Strategic Electronics
Mumbai
One of the leading suppliers of defence

equipment and solutions amongst the Indian
Private Sector.
Power Services
Mumbai
One of the leading service providers for Project

Management, O&M and specialised services in
the power sector.
Tata Power (cont'd)

Comments
Performance by Major Items

2012
2011
Change,
INRbn
Revenue from Power

Supply and
Transmission
Charges, INRbn
9,081.33
8,051.53
1,029.80
13
Finance Costs,
INRbn
6.78
5.15
1.63
32
Depreciation and
Amortisation, INRbn
3.64
5.70
-2.06
-36
% Change
Tata Power reported higher Revenue from Power Supply in 2012 compared
to 2011 mainly because of higher fuel costs.
The company reported higher financing costs mainly due to the fresh issue
of INR 15bn of 10.75% Redeemable and Non-Convertible Debentures.
Depreciation was lower mainly due to a one-time impact of a change in the
depreciation rate and methodology authorised by the Ministry of Corporate
Affairs (MCA) for companies engaged in the generation and supply of
electricity.
In 2012, standalone net operating cash decreased 34% y/y. The company
invested less in 2012 compared to the previous year, took on more shortand long-term debt, but, unlike in 2011, did not issue Unsecured Perpetual
Securities which are classed as equity instruments. This resulted in a
deepened net decrease in cash and 39% less ending cash compared to
2011.
Standalone and Consolidated Cash Flow Statements

2012, INR bn
2011, INR bn
2012, INR bn
201, INR bn
4.32
6.51
32.80
11.47
Net Cash Used in Investing Activities
-14.94
-19.88
-42.86
-61.28
Net Cash from Financing Activities
8.03
11.63
-5.87
57.98
Net Increase/Decrease in Cash and Cash

Equivalents
-2.60
-1.74
-15.93
8.17

6.61
8.35
31.22
21.41
Cash and Cash Equivalents at the End of

the Year
4.01
6.61
17.90
31.22

- 80 -
IX. Appendix

- 81 -
Table of Terms and Abbreviations

Table of Terms and Abbreviations
kWh
A unit of energy equivalent to one kilowatt (1 kW), or 1,000 watts, of power expended for one hour (1 h) of time.
MW
A unit of electric power equal to one million (10^6) watts
GW
A unit of electric power equal to one billion (10^9) watts, one thousand megawatts
MU, BU
MMT, BMT
Plant Load Factor (PLF)
Load Shedding
MWe
MWth or MW t
Million Units, Billion Units; 1 MU = 1 GWh, 1 BU = 1 TWh. For example, 855 BU=855,000 MU=855 TWh
Million Metric Tonnes, Billion Metric Tonnes
Plant Load Factor is the ratio of the actual output of a power plant over a period of time and its output if it had operated a full capacity of
that time period. PLF = Gross Generation / (Installed Capacity * Number of Hours)
The deliberate shutdown of parts of a power distribution system to prevent the failure of the entire system when demand strains capacity.
Megawatt electrical, used in the electric power industry
Megawatt thermal, refers to a unit of tehrmal power produced
ckt km, circuit kilometers
The route kilometers of revenue producing circuits in service, determined by measuring the length in terms of kilometers, of the actual
path followed by the transmission medium.
MMBtu
One million Btu = British Thermal Unit, a unit of energy used for natural gas. Approximately 1,000 ft3 of natural gas 1 MMBtu 1 GJ
(gigajoule).
Source: Reference sources

- 82 -
Ratio Calculation Formulas

Calculation of Liquidity Ratios
Ratio Name
What it Measures
Calculation
Current Ratio
A unit of current assets per unit of current liabilities.

Higher ratio means higher level of liquidity.
Current Assets Current Liabilities
Quick (Acid Test) Ratio
More conservative than the current ratio. Reflects the

fact that certain current assets cannot be easily
converted into cash.
(Cash + Current Investments + Receivables) Current Liabilities
Cash Ratio
The most stringent liquidity ratio. A measure of a

companys liquidity n a crisis.
(Cash + Current Investments) Current Liabilities
Calculation of Solvency Ratios

Ratio Name
What it Measures
Calculation
Debt-to-assets
The percentage of total assets financed with debt
Total interest-bearing debt (long-term borrowings+current portion of long-term borrowings+short-term

borrowings) Total Assets
Debt-to-Capital
The percent of total capital (debt+equity) financed through

debt
Total debt (Total Debt + Total Shareholders' Equity)
Debt-to-Equity
The amount of debt financing relative to equity financing
Total debt Total Shareholders' Equity
Cash Flow/Earnings Index
Operating cash generated per rupee of net income
Net Cash Flow from Operations Net Income
Source: Emerging Markets Insight;

- 83 -
Contact:
Corporate Headquarters
Nestor House
Playhouse Yard
London EC4V 5EX
UK
Voice: +44 207 779 8471
Fax: +44 207 779 8224
Asia Headquarters
Eucharistic Congress Bldg. No.
III
4th Floor, 5 Convent Street
Mumbai 400 001
India
Voice: +91 22 22881123
Fax: +91 22 22881137
Americas Headquarters
225 Park Avenue South
New York, New York 10003
US
Voice: +1 212 610 2900
Fax: +1 212 610 2950
Disclaimer:
The material is based on sources which we believe are reliable, but no warranty, either expressed or implied, is provided in relation to the accuracy or completeness
of the information. The views expressed are our best judgment as of the date of issue and are subject to change without notice. EMIS and Euromoney Institutional
Investor PLC take no responsibility for decisions made on the basis of these opinions.
Any redistribution of this information is strictly prohibited. Copyright 2014 EMIS, all rights reserved. A Euromoney Institutional Investor company.
About EMIS Insight
EMIS Insight is a unit of EMIS that produces proprietary strategic research and analysis. The service features market overviews, industry trend analysis, legislation
and profiles of the leading sector companies provided by locally-based analysts.
About EMIS
Founded in 1994, EMIS (formerly known as ISI Emerging Markets) was acquired by Euromoney Institutional Investor PLC in 1999. EMIS works from over 15 offices
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organisations, and others.

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Utilities Sector

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III. Power Generation - Overview

IV.Power Generation By Type of Fuel

II. Utilities Government Policy

Power Sector Government Policy

Any redistribution of this information is strictly prohibited.

Power Sector Highlights

Power Transmission and Distribution Highlights

1. Top M&A Deals

VI.Water Supply and Sanitation (WSS)

Power Transmission and Distribution Highlights

VII.City Gas Distribution (CGD)

1. Table of Terms and Abbreviations

1. City Gas Distribution (CGD) Highlights

Any redistribution of this information is strictly prohibited.

Any redistribution of this information is strictly prohibited.

Any redistribution of this information is strictly prohibited.

Main Sector Indicators

Installed Generation Capacity, GW*

Gross Electricity Generation, TWh

Transmission Lines Installed, ckt km

Per Capita Electricity Consumption, kWh

All-India Plant Load Factor (PLF) (Coal & Lignite), %

*Includes Renewable Energy Sources (RES)

Source: CEIC, CEA

Power Sector Snapshot

Natural Gas Demand Forecast

Demand from power generators outstrips domestic production of fossil

Fossil Fuel Availability

Total World Consumption: 16,922 Mtoe

Share of Primary Energy Consumption, %

Projected Gas Demand, MMSCMD

Japan and South

Projected Primary Energy Consumption in 2025

Power Sector Snapshot (cont'd)

(charts show Indian fiscal years)

Capacity Addition Targets (MW) for the XII Plan (2012-2017)

XI Plan (2007-12) Capacity Addition - Target Vs Actual

Private Sector Vs Total Capacity Additions

IX Plan (1997-2002) X Plan (2002-2007) XI Plan (2007-2012) XII Plan (2012-2017)

Energy Requirement/Availability Gap, %

Total Capacity Addition, MW

Source: NTPC, Association of Power Producers (APP), CEA

Private Sector Capacity Addition, MW

Energy Availability and Peak Supply Gaps

Private Sector Capacity Addition as Percent of Total

Utilities as Percent of GDP

IPI Weight, FY 2014 GDP Growth Forecasts

Industrial Production Index - Electricity, FY 2005 is base

With a weight of 10.32%, electricity is the fourth-largest contributor to India's

Source: CEIC, EMIS Insight calculations

All India GDP, INR bn (Current Prices)

All India GDP, INR bn (Constant Prices, FY 2005 is base)

Any redistribution of this information is strictly prohibited.

Wholesale Price Index (WPI)

WPI Fuel and Power

WPI Fuel and Power - Coal

WPI Fuel and Power - Mineral Oils

WPI Fuel and Power - Electricity

Wholesale Price Index (WPI), Electricity Subsectors, FY 2005=base

WPI Electricity - Domestic

WPI Electricity - Commercial