A PROJECT ON

ANALYSIS OF THE POWER (ELECTRICITY) SECTOR

IN PARTIAL FULFILLMENT OF THE REQUIREMENTS OF THE MASTER OF MANAGEMENT STUDIES (M.M.S.) DEGREE COURSE 2003-2005

Submitted to PROJECT GUIDE Prof. (Ms) Ranjani

By:

MR. MEHERWAN KOTWAL M.M.S. FINANCE ROLL NO. 25

K.J. SOMAIYA INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH
VIDYAVIHAR MUMBAI

UNIVERSITY OF MUMBAI

CERTIFICATE
This is to certify that the project titled Analysis of the Power (Electricity Sector been submitted by Mr. Meherwan Kotwal, Roll No. 25, towards partial fulfillment of the requirements of the Master of Management (M.M.S.) degree course 2003-2005, has been carried out by her under the guidance of Prof. Ranjani, at the K.J. Somaiya Institute of Management Studies and Research, Mumbai 400 077, affiliated to the University of Mumbai.
The matter presented in this report has not been submitted for any other purpose in this institute.

Prof. Ranjani, Project Guide, K.J. Somaiya Institute of Management Studies and Research, Mumbai. 15th of March 2005

ACKNOWLEDGEMENTS
I would sincerely like to thank my project guide, Prof. Ranjani for her valuable support, guidance and encouragement given to me during the course of this project. I am grateful to the library staff of the institute for their timely co-operation. I also thank the administrative staff members for providing help at various stages. I extend my heartfelt gratitude to my colleagues and other good wishers who contributed towards the successful completion of my project work

Dated: March 15th 2005

Meherwan Kotwal

EXECUTIVE SUMMARY

The Power Sector in India presently experiences a deficit in the supply of electricity. Even the per capital consumption in India is much lower than the rest of the world.

The Power Sector is looking ahead to exciting times after being in the stronghold of the Public Sector since independence.

The Report adopts a top-down approach while dealing with the power sector. It starts off with the international power consumption patterns, then narrows it down to the domestic power scenario and finally focuses on individual companies in the domestic electricity generation, transmission and distribution arena.

The Report also pays emphasis on the newly introduced Electricity Act in the year 2003 and examines its positive implications on the entire industry.

Issues critical and peculiar to the Indian Power Scenario are also looked into and explained.

The report also tries to envisage the future of the power sector and specifies the reasons why the sector as such would look attractive for investments.

Finally a closer inspection of 3 of the leading power companies in the country is carried out and their financial performance is examined.

INDEX

The International Energy Consumption Patterns The International Coal Scenario The International Hydro Power Scenario International Nuclear Energy Scenario Indias Commercial Energy Consumption Indias Electricity Scenario Power Generation Indias Current Situation with respect to Coal Indias Thermal Energy Scenario Indias Hydel and Renewable Energy Scenario Nuclear Power in India Power Transmission Power Trading Power Distribution Electricity Act 2003 Important Issues Relating to the Power Sector Pricing Tri-partite Agreement Transmission and Distribution Losses Open Access Captive Consumption The Future of the Power Sector Why does the Power Sector in India look attractive Company Study NTPC Tata Power Reliance Energy Bibliography

6 8 10 11 12 13 15 17 19 21 22 24 26 27 31 34 35 36 37 38 40 43 48 52 56

The International Energy Consumption Patterns

The worlds total Primary Energy Consumption has shown a compounded average growth rate (CAGR) of 2.5% over the last 35 years. The forms of energy include coal, oil, gas, nuclear power, hydro and other renewable resources. If we also take into account the increase in population over the abovementioned time period then we see that there has been a per capita CAGR of around 0.7%.

The worlds current energy mix is given below:

The International Energy Mix

Renew ables 1% Hydro 7% Nuclear 7% Coal 24%

Gas 22%

Oil 39%

It is interesting to note that the fossil fuels i.e. hydrocarbons and coal account for 85% of the total energy consumed.

The fastest growth rate in energy consumption has been seen in the Middle East followed by the Asia-Pacific region (excluding Japan) over the last 35 years. Eastern Europe and Russia have seen a negative growth rate of around 3.5% over the last 15 years due to political turmoil and economic changes.

Going into the future we shall see coal maintaining its current share of the energy mix and once the oil and gas stocks start depleting its share could go up to 33%. This is because by the coal gasification and liquefaction technologies would be well developed. Given the limited fossil fuel resources it is expected that the share of renewable sources of energy will go upto 23% as a results of new discoveries and development of alternative processes for generating energy.

THE INTERNATIONAL COAL SCENARIO

Coal has been one of the oldest inputs for energy production as well as for the manufacture of iron and steel. With the oil shocks of the 1970s coal once again started gaining its lost glory and retained its position as an important source of energy supply especially for power generation.

At the turn of the century coal accounts for about 24% of the worlds Commercial Energy consumption. The coal consumption in the year 2004 was around 5000 tons. The share of the Asia-Pacific region (including Japan) was around 44% of the international consumption of coal.

China is the worlds largest consumer of coal with a consumption of over 1100 million tons which accounts for nearly 22% of the total international consumption. In the 2nd place came the United States of America which consumed around 1050 million tons of coal or roughly 21%. The third largest consumer of coal in the world is India that accounts for a consumption of roughly 360 million tones representing 7% of in international consumption.

The consumption of coal has gone down drastically in the European regions because natural gas has substituted domestic coal in the energy mix of these countries. Over the next two decades, coals share of global primary energy consumption is expected to decline to about 22% by 2020 after which there shall be a renewed emphasis and greater consumption of coal.

Following are some of the countries that account for a majority of the coal reserves in the world:

rank country 1. USA 2. Russian Federation 3. China 4. India 5. Australia

anthracite bitumous 115,891 49,088 62,200 82,396 42,550

& sub-bitumous lignite 134,103 107,922 52,300 2,000 39,540

&

percent total total 249,994 25.39% 157,010 15.95% 114,500 11.63% 84,396 8.57% 82,090 8.34%

of

At the end of the year 2003 the total international coal reserves stood at around 985 billion tons. The reserves to production ratio of coal is around 216 years making it one of the most reliable and abundant energy sources in the world.

For the Asia-Pacific region especially for India and China large increase in coal consumption is forecasted. This is because these economies not only have large exploitable coal reserves but are also on the fast track and are showing phenomenal industrial and GDP growth. These economies 9

are expected to keep growing at the same pace for atleast a few more years that would put great pressure on the energy resources and thus would culminate into an increased usage of coal to supply the industries with more and more power. Japan would continue to import coal and more that 50% of its coal consumed would be utilized by the countrys steel industry.

THE INTERNATIONAL HYDROPOWER SCENARIO

The worlds theoretical hydropower potential is estimated to be around 40000 Tera Watt hours, the technical potential at around 14000 Tera Watt hours and the economic potential at around 8000 Tera Watt hours. As against this only one third of the economic potential has yet been developed. The US and Western Europe has estimated to have already developed 76% and 65% of their potential. However in regions like Africa and Asia less than 20% of the potential is in use today.

The worlds installed hydro capacity stands at around 700 GW. The largest producers of hydroelectricity in the world are Canada, US, Brazil, China and Russia

Hydropower has cerain advantages, the principle among them being the ability to start and stop quickly and instantaneous load acceptance and rejection. The other benefits offered by hydropower plants are the long life of the plant, the renewable nature of the of the energy source, very low operating and maintenance costs and absence of inflationary pressures experienced by fossil fuels.

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Worldwide about 125 GW of hydro capacity is under construction bulk of which is in the developing countries.

INTERNATIONAL NUCLEAR ENERGY SCENARARIO

Nuclear Energy has seen a phenomenal growth from just 12 GW capacity in the year 1960 to around 349 GW at the turn of this century accounting for around 12% of the worldwide capacity and around 16% of the generation.

Following table summarizes the international nuclear energy situation: Particulars Number of generating countries Number of nuclear units in operation Nuclear Capacity Nuclear Energy Generation Nuclear Energy Share in Generation Uranium Requirements

31 434 349 GW 2407 TWh 16% 60000 tons

Nuclear energy has help economies engaged in its production to achieve Energy Security and helped them reduce their CO2 emissions since it is a carbon free energy resource. However there are concerns about the safety of using such a resource for energy production because of a few disasters that have occurred while nuclear power has been generated.

The following countries are the largest generators of nuclear power in the world today.

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Name of Country USA France Japan Germany Russia

Billion KWh 769 401 322 162 125

INDIAS COMMERCIAL ENERGY CONSUMPTION

The Following table given below summarizes the current consumption patterns within our country:

315 Million Tons of Oil Equivalent

OIL COAL NUCLEAR NATURAL GAS HYDRO / RENEWABLES

Thus we see that India depends for around 93% of its energy consumption on hydrocarbons viz. oil, coal and natural gas. With the discovery of gas its proportion in the pie shall slowly move up.

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But India has got a vast pool of unutilized renewable sources of energy that needs to be exploited further for better energy security and sustainable development.

INDIAS ELECTRICITY SCENARIO

There had been a complete shift in the ownership of utility companies since independence. At the time of independence private sector utilities and licenses provided over 80% of the total electricity supply in India. However after independence there was a gradual reversal of ownership. State Electricity Boards took over most private licensees when their licenses expirted and after 1956 no new licneses were granted. In the same year the government decided that the generation and transmission of electricity would be reserved exclusively for the public sector.

The total generation capacity available to the grid was 112,058 MW as on 31st March 2004 consisting of 31,370 MW hydro, 77,968 MW thermal, 2,720 MW nuclear and 1,617 MW wind. Of the total capacity the SEBs own 57% of the total installed capacity, while the private and the central sector own 8% and 35% respectively.

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The following chart illustrates the current breakup of electricity generation in the country.

NUCLEAR 2% WIND 1% THERMAL 70%

HYDRO 27%

HYDRO THERMAL WIND NUCLEAR

The electricity consumption has grown at an average rate of 7.0% (CAGR) during the period 1970-2002. However the growth has been uneven among the various consumer categories. The share of domestic and agricultural sectors in the total sales increased from 19% in 1970-71 to nearly 50% in 2001-02 while that of industry declined from over 68% to about 29% during the corresponding period.

The per capita electricity consumption increased from 178 kWh in 1985-86 to 355 kWh in 19992000 i.e. an increase of about 5.1% per annum. The regional share of power consumption has also changed marginally, the western region leads in power consumption with a 35% share in 1999-2000 from 29% in 1980-81, followed by the Northern region.

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The fastest growth in power consumption has taken place in agriculture. This is mainly because of the increased use of irrigation pump sets. Also the government has been laying stress on rural electrification and as a result of this there has been a substantial increase in demand for electricity for agriculture. The Electricity Sector in India can be distinctively divided on the basis of the stages of the electricity cycle into the following categories: A] GENERATION B] TRANSMISSION C] DISTRIBUTION

Let us take a look at GENERATION first.

INDIAS CURRENT SITUATION WITH RESPECT TO COAL

Commercial coal mining in India has a history that spans beyond 2 centuries. At the beginning of the first 5-year Plan the coal production was 33 million tons and as time progressed this limited production proved to be inadequate for meeting the needs of the growing demand. The government was of the view that since this industry was highly capital intensive adequate finance was not coming from the private sector. Besides the mining practices adopted by the mine owners and the working conditions that were offered to the labourers were highly sub-optimal.

On account of this the government decided to nationalize the private coalmines. The nationalization was done in two phases, the first with the coking coal mines in 1971-72 and then

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with the non-coking coal mines in the year 1973. In 1975 the nationalized coal industry was brought under the aegis of Coal India Limited. The government had passed an order not allowing private players to mine coal unless if it were for captive plants for iron and steel industry.

Coal is the most abundant energy resource available in India and hence has found maximum use in whichever industry in which it can be used as an alternative.

Following are some macro facts about coal in India: Reserves Proven Reserves -- 220 billion tons -- 80 billion tons

Current Consumption -- 335 million tons/year

In India more than 2/3rds of coal consumption is taken up by the Power (Electricity) Sector and a majority of the remaining part gets taken up by sectors such as steel and cement.

The coal reserves are mainly concentrated in the eastern parts of the country. The following are the states accounting for the largest coal reserves in the nation. State Jharkhand Orissa Madhya Pradesh West Bengal Total Reserves 69175 million tons 51571 million tons 49543 million tons 25919 million tons Percentage of Total 31% 23% 22% 12%

Out of the 220 billion tons of reserves 190 billion tons are of the non-coking type.

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The lignite reserves are currently place at around 35 million tons most of which occur in Tamil Nadu. Other states where lignite reserves are found are Rajasthan, Gujarat, Kerela, Jammu and Kahmir and Union Territory of Pondicherry.

India today is the 3rd largest producer of coal in the world just behind USA and China. Till the year 1978 India was self-sufficient with respect to coal. But from the year 1979 the country has started importing coal and today imports about 22 million tones. The imports have increased because as per the current import policy coal can be freely imported under Open License. Coking coal is imported by domestic companies such as SAIL to improve quality of the overall blend due to technological reasons.

Power Sector today is the single largest user of coal. Its share in coal consumption has gone up from 24% at the beginning of the 1970s to over 70% at the present moment. The share of the power sector in this regard is expected to grow further in the times to come.

The working group on Coal and Lignite for the formulation of the 10th 5-Year plan has assessed the countrys demand in 2006-07 will be around 453 million tones. As against this the production will be around 405 million tones and the balance shall need to be imported.

INDIAS THERMAL ENERGY SCENARIO

India gets majority of its electricity requirements from this source due to the abundance of coal as a natural resource in the country. Though the thermal energy sector accounts for 36% of the

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capacity utilization it accounts for 39% of the power generated. This is on account of the higher operating efficiencies that it enjoys. The following chart depicts the shares of the current major players in the thermal electricity generation field: Capacity Electricity Generation (MW) % Share (GwH) % Share 27629 36 182887 39.2 40849 53.3 237432 50.9 8191 10.7 46229 9.9 28925.2 100 466618 100

Central State Private Total

Amongst the Central Utilities NTPC has got the largest share accounting for a production of close to 85% of the centers share of thermal power generation. Besides NTPC, there are other central power generating authorities such as Neyveli Lignite, NEEPCO that account for the balance production of the center. Amongst the private Sector the largest thermal power generating company is Tata Power which accounts for around 9300 GWh of electricity production. It is followed by Calcutta Electricity Supply Company (6685 GWh) and Reliance Energy (6555 GWh). The installed capacities of these 3 largest players are as follows: Tata Power CESC Reliance Energy ---1411 MW 1065 MW 894 MW

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INDIAS HYDRO AND RENEWABLES ENERGY SCENARIO

India seems to be ignoring the potential energy that can be generated via renewable energy sources even though it has a separate ministry dealing with new and renewable energy sources. The following table will illustrate the current situation:

Biogas Plants Wind Solar Energy Waste to Energy Solar Water Heating

Potential 120 lakh 45000 MW 20 MW / sq. km 1700 MW 1400 lakh sq. m

Achievement 32.75 lakh 1507 MW 82 MW 17.1 MW 600000 lakh sq. m

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Indias current capacity from renewables (other than Hydro) stands at about 3400 MW or over 3% of the energy generated in the country. For the year 2012 a target of 10000 MW of power from renewables has been envision by the countrys policy planners.

As far as hydro-electricity generation goes the share of the total pie has gone down over the last 25 years. A lot of unexplored potential lies in generating power in this manner. The total potential is summarized as under. Basins / Rivers Indus Ganga Central Indian Rivers West-flowing rivers East-flowing rivers Bhramaputra Potential Load at 60% Load Factor (MW) 19988 10715 2740 6149 9532 34920

The total potential at 60% plant load factor is estimated to be around 84,044 MW. Thus this will require an installed capacity of 148,701 MW. The cost of developing this untapped potential in the country has been estimated to be about Rs 5,00,000 crores at current price levels.

The Ministry of Power has taken several measures like higher budgetary allocation, improving tariff dispensation and so on as the actual installed capacity is only about 15000 MW in the country. Another 6000 MW of hydel power is under development. The following are the market shares of the respective players vis--vis hydro-electricity: Capacity (MW) Central State Private Total Electricity Generation % Share (GwH) % Share 7754 26.8 26114 35.5 20294 70.2 44678 60.5 877.2 3 2974 4 28925.2 100 73796 100

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NHPC is the largest hydro power generating corporation in the country. With a total installed based of 2175 MW, the corporation has eight operational projects located in the northern, eastern and northeastern regions of the country. The company aims to add 4357 MW by 2007 and 14,432 MW by the end of the eleventh plan period.

NUCLEAR POWER IN INDIA

India at present has 14 nuclear power plants with a total installed capacity of 2720 MW. Nuclear Power Corporation of India, a wholly owned enterprise of the Government of India operates these plants. India has sufficient Uranium reserves to support a program of 10000MW power generation based on Pressurised Heavy Water Reactors. The Department of Atomic Energy plans to ramp up the installed capacity of nuclear power within the country to 20000MW by the year 2020. For this purpose energy would have to be generated using plutonium first. In the next step Uranium 233 would have to be extracted from Thorium to achieve the energy production targets. India has vast reserves of Thorium and these should come in handy to the Department of Atomic Energy. The following table below summarizes Indias Current Nuclear Power Generating Capacity Plant Tarapur Rawatbhata Kalpakkam Narora No. of Plants 2 4 2 2 Total Capacity 320 740 340 440 21

Karkrapara Kaiga TOTAL

2 2 14

440 440 2720

New capacity in nuclear power is also coming up as under: Location Tarapur Kaiga Rajasthan Kundankulam TOTAL No. of Plants 2 2 2 2 8 Total Capacity 1080 440 440 2000 3960

POWER TRANSMISSION
The Regional Power Grids in North, West, South, East and North-East have been established for optimum utilization of the unevenly distributed resources in the country by facilitating interregional and intra-regional power exchanges. Power Grid Corporation of India limited (PGCIL) was incorporated on October 23, 1989 as a public limited company, wholly owned by the Government of India. PGCIL started functioning on management basis with effect from August, 1991 and it took over transmission assets from NTPC, NHPC, NEEPCO and other Central/Joint Sector Organisations during 1992-93 in a phased manner. In addition to this, it also took over the operation of existing Regional Load Despatch Centres from CEA in a phased manner, which are now being upgraded with State ofthe-art Unified Load Despatch and Communication (ULDC) schemes. According to its mandate, the Corporation, apart from providing transmission system for evacuation of central sector power, is also responsible for Establishment and Operation of Regional and National Power 22

Grids to facilitate transfer of power within and across the Regions with Reliability, Security and Economy on sound commercial principles. Currently, it owns majority of inter state transmission assets. Private investment has been allowed in power transmission either through 100% equity or joint venture with PGCIL. In case of latter, the PGCIL will hold only 26% stake and the rest would be held by private party. Based on envisaged generation capacity addition program, it is expected that Eastern and NorthEastern regions would be a major source of additional power over the next decade and North, West and Sourth regions would be the major recipients of this power. To cope up transmission capacity is expected to reach 30000 MW by 2012. Name of Link HVDC LINKS Vidyanchal Chandrapur Gazukawa AC LINKS Balimela-Seleru Kolhapur-Belgaum Seleru-Burgur Karmnasa-Sahupur Biharsharrif-Sarnath Bipora-Sulakoti Auraiya-Malanpur Bongaigaon-Malda Kobra-Buddhipadar TOTAL Capacity 500 1000 500 200 300 100 200 500 100 200 800 450 4850

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POWER TRADING
Power trading inherently means a transaction where the price of power is negotiable and options exist about whom to trade with and for what quantum.In India, power trading is in an evolving stage and the volumes of exchange are not huge. All ultimate consumers of electricity are largely served by their respective State Electricity Boards or their successor entities, Power Departments, private licencees etc. and their relationship is primarily that of captive customers versus monopoly suppliers. In India, the generators of electricity like Central Generating Stations (CGSs), Independent Power Producers (IPPs) and State Electricity Boards (SEBs) have all their capacities tied up. Each SEB has an allocated share in central sector/ jointly owned projects and is expected to draw its share without much say about the price. In other words, the suppliers of electricity have little choice about whom to sell the power and the buyers have no choice about whom to purchase their power from.

India being a predominantly agrarian economy, power demand is seasonal, weather sensitive and there exists substantial difference in demand of power during different hours of the day with variations during peak hours and off peak hours. Further, the geographical spread of India is very large and different parts of the country face different types of climate and different types of loads.

Power demand during the rainy seasons is low in the States of Karnataka and Andhra Pradesh and high in Delhi and Punjab. Whereas many of the States face high demand during evening

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peak hours, cities like Mumbai face high demand during office hours. The Eastern Region has a significant surplus round the clock, and even normally power deficit states with very low agricultural loads like Delhi have surpluses at night. This situation indicates enough opportunities for trading of power. This would improve utilization of existing capacities and reduce the average cost of power to power utilities and consumers.

In view of high fixed charges, average tariff becomes sensitive to PLF. Trading of power from surplus State Utilities to deficit ones, through marginal investmentI in removing grid constraints, could help in deferring or reducing investment for additional generation capacity, in increasing PLF and reducing average cost of energy. Over and above this, the Scheduled exchange of power will increase and un-scheduled exchange will reduce bringing in grid discipline, a familiar problem.

PTC India Ltd. (PTC, formerly power trading corporation), is the leading provider of Power Trading services, and has been trading power on a sustained basis since FY 2002 through purchase from surplus utilities and sales to deficit ones at an economical price, providing best value to both the buyers and sellers and ensuring that the resources are utilized optimally.

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POWER DISTRIBUTION
The Central Government has got as negligible share in the distribution of power throughout the country. The bulk of the power generation is carried out by the State Governments via their state electricity boards within their respective states. The private sector also operates in a limited capacity as distributors of electricity. The players procure energy from their own generating plants, the Central Government plants and the independent producing plants and then supply the electricity to the end consumer. Distribution reforms have been identified as the key area of reforms in the power sector. The reforms aim at boosting private sector participation in the distribution of electricity and restructuring of the State Electricity Boards. Under the ongoing reforms programme, distribution has been privatized in Orissa and Delhi. While in Orissa, the power distribution is divided into four zones of which three are owned by Reliance Group Companies. The other zone was privatised in favour of AES Group, . The Delhi state was privatised by distributing city in three zones with two of the zones going in favour of Reliance Group and the remaining in favour of Tata group. The following are a few private companies that are engaged in distribution: Name of Company CESC Ahmedabad Electricity Tata Power Reliance Energy Surat Electriciy NESCO WESCO SOUTHCO CESCO Location Kolkatta Gujarat Mumbai Mumbai Surat Orissa Orissa Orissa Orissa

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BSES Rajdhani BSES Yamuna NOIDA Power Company

New Delhi New Delhi Uttar Pradesh

ELECTRICITY ACT 2003

Electricity Act 2003 was need to bridge the discrepancy between the future needs and actual capacity in the Indian electricity sector. Only 55% of households in India have access to electricity, and many of these do not get uninterrupted reliable supply. Moreover, tariffs for the electricity provided are among the highest in the world. Just over half of the capacity additions planned during the 8th and 9th plans (1992-2002) was actually added. Ambitions for future development, however, have not faltered. The Act aims to fulfill the governments plan to provide electricity for all villages (about 80,000 more than currently covered) by 2007 and all households by 2012. As discussed in the introduction the Ministry of Power estimates that over 100,000 MW of additional capacity will be required to meet these goals. The Government of India also plans to augment inter-regional transfer capacity from the current 8000 MW to 23,500 MW by the end of the 10th Plan in 2007.

The following are the features of EA 2003:The act eases requirements for private entry into generation: It reduces licensing requirements for generation, except hydropower (which still needs clearance from the Central Electricity Authority as it uses the states resources). Captive generation is freely permitted, as are dedicated transmission lines . Captive power plants are also exempted from surcharges for access to the grid. The act encourages creation of nonprofit societies, user associations, and other arrangements in rural areas these will be allowed to buy bulk power and bypass SEBs.

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1) It also opens transmission and distribution to private participation, though participants still require licenses: Private participation in operating and maintaining transmission networks had been allowed previously, but EA 2003 allows private companies to potentially set up parallel transmission networks. The policy creates some threat of competition for existing transmission networks, but has the disadvantage that costly parallel networks may be built if the state-owned transmission utilities do not or cannot invest enough to improve their transmission reliability. Existing distribution companies are free to undertake generation, while generation companies could also engage in distribution.

Multiple distribution licenses may be issued for any particular area.

EA 2003 also requires that all transmission utilities provide non-discriminatory open access to their system from the outset. Open access in distribution will be phased in as soon as arrangements for cross-subsidy surcharges can be worked out. In addition to accepting private participation and planning for open access, EA 2003 proposes a new tariff framework based on competitive bidding transmission, distribution, and retail supply for electricity. to form the basis for generation,

The combination of lower barriers to private sector participation and open access to transmission and later distribution are steps toward facilitating national power trading in addition to the contracts determined by competitive bidding. Transmission utilities are barred from trading, but distribution companies will be allowed to trade without separate licenses, and generation companies can sell to any users as soon as regulations are developed. CERC has set out licensing

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requirements, including capital adequacy and human capital requirements for other companies wishing to act as intermediaries between generators and distributors of energy.

2) Restructuring of SEBs: The Act provides general guidelines for restructuring of SEBs, including vesting of assets in state governments, provisions for sale of parts of the Board to private companies, and division of the SEBS into separate generation, transmission, and distribution companies

3) Reduction of Transmission and Distribution Losses: EA 2003 also contains several provisions aimed at reducing transmission and distribution losses. It requires universal metering and permits state governments to set up special courts to provide quick trials in cases of theft. Punishments for theft include up to three years of imprisonment as well as fines.

4) Consumer Protection: EA 2003 increases consumer protection by mandating that distribution licensees set up a forum for addressing consumer complaints in accordance with guidelines to be specified by the state regulatory commissions. Each SERC must appoint an ombudsman to hear complaints that are not redressed by the distribution licensees. Regulators are explicitly prohibited from setting tariffs that discriminate among consumers of electricity except on technical grounds such as load factor, time and size of consumption, etc. An appellate tribunal provides an avenue for consumers to protest other regulatory decisions EA 2003 requires advance approval for sales, mergers,

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takeovers of entities within the same state, and states that no licenses would be exclusive within a region.

These provisions may limit monopoly powers, though much will still depend on the development of regulation to prevent abuse of market power. There is currently no limit in the percent of generation capacity that can be owned by a single company.

5) Puts Central Government in the Drivers Sear: Finally, EA 2003 establishes the Central governments leadership though not explicit control in developing a common national energy policy, accounting and regulatory norms, as well as tariff frameworks and arrangements for making subsidies more transparent. The Act empowers the Central Government to prepare a National Electricity Policy in consultation with State Governments, while it reiterates the supervising role of the Central Electricity Authority in advising the central government in the National Electricity Policy, specifying technical and safety standards for new projects, specifying grid standards for new transmission lines, carrying out research, and advising all levels of government as well as private licensees.

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IMPORTANT ISSUES RELATED TO THE POWER SECTOR

PRICING
The transition to market-based tariffs appears to be closer for generation than transmission or distribution. Transmission pricing is complicated by the need to coordinate state and central policies to ensure prices reflect grid conditions. Distribution and retail pricing is complicated by the inevitable interface with consumers, many of whom have been conferred political protection vis--vis prices.

Generation

The CERCs new tariff guidelines for generation and inter-state transmission fill in the gap between the previous system of two-part tariffs and future pricing based on competitive bidding. The two-part structure is similar to before, with fixed costs based on depreciation, interest on working capital, income taxes, etc.

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The key difference is that the tariffs provide a ceiling of 14% return on equity, as opposed to a floor of 16% under past regimes. The main reason for this that inflation has fallen down from higher levels to much lower levels as of now.

Working capital allowances and operations and maintenance costs, transit and handling losses of coal, and other operating parameters are set at normative rather than actual levels, so that companies can only make this rate of return by performing at relatively high benchmark levels. The regulations also clearly specify applicable interest rates, income tax assessments and depreciation rates, limiting the potential areas for clever accounting. The debt-equity ratio applicable for calculating rate of return on equity has also been increased from 50:50 to 70:30.

The new regulations are an advance over past pricing policies in several ways. They reduce the windfalls that generating companies had accumulated in the past, and reward generating plants for more efficient operation

The new regulations also increase the rewards for higher plant load factors.

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Transmission

The new guidelines for long-transmission tariffs are similar to those for generation in several ways. As in generation, the recovery of annual transmission charges is based on normative rather than actual costs of operations and maintenance and auxiliary power, allowances for working capital, and other operating parameters. The ceiling of return on equity is lowered to 14%, and the debt-equity ratio is also increased to 70:30 as in generation tariffs. The precise rules for calculating depreciation, interest on working capital, are also clarified in the regulations.

Target availability of transmission capacity is the main performance measure embedded in the regulations for longer-term contracts it is set at 98% for an AC system and 95% for HVDC systems. Recovery of fixed charges is reduced for lower availability. Rules for

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open access also provide an incentive to maintain transmission lines at high capacity, as transmission licensees can keep a quarter of the charges earned from providing transmission to short-term customers while returning the balance to longterm customers through tariff reductions.

The regulations basic floor for pricing, in Rs per MW per day, is backwardlooking. The short-term rate based on the average transmission charges over the past year divided by average capacity served over the last year. Transmission utilities are expected to announce a rate in Rs per MW per day at the beginning of the year, which remains in effect for a year..

If requests for access are higher than capacity, snap bids are solicited by the Regional Load Dispatch Center. Bidders bid in terms of percentage points above floor price and

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reservation of trading capacity made in decreasing order of price quoted. Everybody pays the lowest price bid. Transmission customers bear the costs of transmission losses on the basis of average losses in the national transmission system, calculated ex-post based on actual flows. It would be worthwhile to consider changing this regime to one in which transmission companies bear the burden of these losses, as this would create a greater incentive to mitigate losses.

Distribution

The state electricity boards have been providing subsidised power to the agricultural and the domestic sector with the subsidy to be recovered from the state Government and the other customers like industrial and commercial which are supplied power at surcharged rates. Thus the distribution gets priced at rates that are cross-subsidized. A higher rate is charged to industrial users to compensate for the lower rate charged to the domestic consumers of electricity and the close to zero rate charged to the agricultural consumers.

TRI PARTITE AGREEMENT

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All the 28 State Governments signed the tripartite agreements with the Central Government and Reserve Bank of India to wipe out the outstanding dues of the SEBs to the CPSUs. 26 states issued bonds amounting to Rs289.8bn as of March 2004.

60% of accumulated interest and surcharge was waived and the balance interest/ surcharge along with the principle amount was securitised.

The States have issued 15 years State Government guaranteed tax-free bonds (with an interest rate of 8.5%).

Besides, the penal provisions on non/delayed payment by SEBs, a provision for cash incentive was also built in.

SEBs were required to establish a Letter of Credit for 105% of their average future monthly billing with a view to ensuring payment to CPSUs for their future supply of power.

TRANSMISSION AND DISTRIBUTION LOSSES

Some amount of transmission & distribution losses (T&D losses) occur in a power distribution system on account of inherent electrical resistance of the transmission cables. Internationally, about 10% T&D losses occur in a power transmission system.

Further, there can be theft which can increase the losses. All of this electrical energy lost

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results in loss of revenue for the power utilities thereby reducing their overall income from the electricity generated. However, in India, the state electricity boards which are the primary agencies for distribution of the power sector have T&D losses including theft at a level of around 45%. The SEBs previously had been reporting lower Transmission and Distribution losses since the quite a few of the power thefts were clubbed with agricultural power consumption this resulting into a misleading figure of T&D losses. However with the unbundling the truth has come out. This has resulted in severely straining the financial position of the state electricity boards.

OPEN ACCESS
CERC has formulated the policy of allowing open access through transmission lines, which are inter-state in nature. The customers would be categorised as long term customers, those who want to use the transmission lines for more than 25 years or the existing beneficiaries of the regional transmission utilities; and short term customers, those not covered in earlier. Allotment priority would be higher for a long-term customer. The access would be allowedbased upon stipulations in grid code (for long term customers); and design margins on account of design, variation in power flows and inbuilt spare transmission capacity (for short term customers). A long term customer would have to enter into a bulk power transmission agreement with the transmission licensee. Under the policy, the total costs of power transmission utility (as approved by CERC) would be shared between its customers.

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Open Access will enable the end power user to chose which electricity generating company he wants to get his power supplied from and completely circumvent the State Electricity Boards through whom it is compulsory to acquire power and deal directly with the power producing company.

The Open Access policy however would come up with the problem of the private sector coming up with transmission lines parallel to the public sector lines. This would result into a fall in revenue for the public sector and funds that get blocked in the duplication of the governments efforts. These funds could be channeled to the generation and distribution areas instead for their more effective use.

CAPTIVE CONSUMPTION
The power supplied by the public sector undertakings is insufficient for meeting the needs of some industrial establishments especially in the rural parts of the country where these plants are located. In addition to this the power supply is erratic and the power generating companies resort to load shedding. During this time period there is no electricity supply to the plant that would result in a waste of the facilities and time. Thus to overcome this shortcoming of the electricity sector in the country, some of the companies have come up with captive power generating plants near their factories to cater to their power requirements. The sizes of the captive power producing plants range all the way to 300 MW. However this act of switching over to captive power plants adversely affects the fortune of the State Electricity Boards. This is because they are deprived of the higher revenue from these industrial undertakings and their customer mix gets more skewed towards agricultural customers

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to whom electricity at times is provided free or at a very negligible cost. The price at which electricity is provided to the farmers is anyways way below the cost of generating it, thus resulting into heavier losses for the State Electricity Boards.

THE FUTURE OF THE POWER SECTOR

There is a ready market for power that can be supplied to the companies in the power sector and hence there is tremendous potential for these companies to increase their sales. However the investments that are required to be made in the power sector are highly capital intensive and also have a long gestation period. Hence the growth of the power sector will be a combined effort of both the public as well as the private sectors of the economy. The Sector faces the problem of the sick State Electricity Boards. The Electricity Act of 2003 has provided a certain amount of relief to the debtors of the SEBs and memorandums of

understanding that have been signed would give the electricity generating companies more confidence to deal with these institutions.

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Further progress in the reforms process would help reduce the gap between the cost of supply and revenue realized for the electricity that is generated. A comprehensive Blue Print for the power sector development has been prepared envisaging the robust development of this sector to serve the needs of the nation in the future. A capacity addition target of 46500 MW in the Central Public Sector Undertakings and 41800 MW by the State Electricity Boards, State Utilities and the Private Sector has been planned for the 10 th and 11th 5-Year plan combined. The capacity addition for nuclear power is envisioned at 6400 MW and that for non-conventional sources at 10700 MW for the period upto the year 2012. For the immediate 10th Plan the Working Group on Power has estimated a feasible capacity addition of 46939 MW out of which 24405 MW will be contributed by the Public Sector, 12033 MW by the States and 10501 MW will be contributed by the Private Sector. The estimated funds for these investments would aggregate to an amount above Rs 500000 crores. The Energy Requirement is expected to increase as follows: 10 Plan 11th Plan 12th Plan
th

Year 2007 2012 2017

Energy Requirement 720 Billion KWh 975 Billion KWh 1319 Billion KWh

Peak Load Demand 115645 MW 157107 MW 212577 MW

The implicit growth rate of energy consumption in the country over the next 15 years is estimated to be in the range of 6.5% - 7% per annum. The North-East, North and Western regions of the country would account for the fastest growth in the energy consumed over the abovementioned time period.

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WHY DOES THE POWER SECTOR IN INDIA LOOK ATTRACTIVE?

India is the second most populated economy of the world. However if you take a look at its per capita power consumption it is in line with the African Developing Countries. The government has realized the anomaly and is working towards a solution. It has decided to unbundled the components of this sector and throw it open to private competition. The private players would be required to make large investments in the power generation, distribution and transmission fields. The projects would tend to be capital intensive and have long gestation periods. Yet there is bound to be substantial interest shown by the big ticket private sector players. Following are some of the main reasons why:

A] Current Deficit in power supply in the country:

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There is ample room to absorb more production since the current scenario within the power sector is that of deficit in electric supplies. The industries across the board would be more than happy to have a stable and continuous electricity supply for meeting their manufacturing needs.

B] Anticipated strong growth in consumption: Over the last 15 years the electricity consumption has grown at a Compounded Annual Growth Rate (CAGR) of 7%. The growth in consumption is expected to continue at roughly the same rate in the couple of decades to come. This would offer the private players a vast unexplored market that is growing in size.

C] Reform Measures Initiated: With the passing of the Electricity Act of 2003 a lot of maladies faced by the power sector have been remedied. The government has unbundled the sector and made entry more feasible for the private sector. The Act also offers all the current private as well as public companies a host of benefits (covered previously under the title the Electricity Act 2003).

D] Fiscal Benefits offered by the government: Several fiscal incentives designed to attract investment in the power sector have already been implemented. The policy of zero customs duty to selected mega power projects, that serve multiple states has been liberalized to extend these benefits to all thermal power projects of 1,000-MW and above and all hydel projects of 500 MW and above. Second, customs duty on equipment for high voltage transmission projects has been reduced from 25 percent to 5 percent in the 2003-4 budget and basic customs duties on other power

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transmission and distribution projects were reduced from 25% to 10% in the interim 2004-5 budget. Special additional duty of 4% was removed. The 2004-5 interim budget also proposes a reduction of customs duty on electricity meters from 25% to 15% and a reduction of customs duty on coal from 25% to 15%.20 The interim 2004-5 budget also extends fiscal benefits (including 100% tax deduction for profits from new power generators) to 2012, instead of 2006 as had previously been the policy. These benefits will apply to companies that take parts of State Electricity Boards assets as well as new investors.

E] Financial Benefits offered by the government: In the interest of obtaining a greater flow of funds to the electricity sector, 100% foreign equity in hydro-electric, coal/lignite based, and oil/gas based thermal power plants is now automatically approved. Other financial incentives being discussed are: 1) Bonds issued by these companies can be used by the banks to meet their SLR requirements. 2) Raise cap on interest rates on External Commercial Borrowings to attract investors. 3) Designation of rural electrification, transmission and distribution as priority sectors for Bank lending.

F] Unexplored Domestic Energy Generating Resources: Irrespective of whichever way in which electricity is produced, the truth remains that India has got a lot of unexplored potential energy generating resources that have remained unutilized. The

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energy generated with the help of Hydel power can be easily doubled. Private investors definitely would be tempted by such opportunities and would assist them in accepting the proposals for investment.

The attractiveness of the sector is evident from the abovementioned facts. Now let us briefly take a look at few of the leading players that are currently operating in this market.

National Thermal Power Corporation (NTPC)

National Thermal Power Corporation Limited (NTPC) is the largest thermal power generating company of India. A public sector company incorporated in the year 1975 to accelerate power development in the country as a wholly owned company of the Government of India

Today NTPC is the 6th largest in terms of thermal power generation and the second most efficient in terms of capacity utilisation amongst the thermal utilities in the world.

The following are the details of NTPCs installed capacity:

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Coal Based Projects Gas Based Projects Joint Venture Projects

18480 MW 3855 MW 314 MW

TOTAL CAPACITY

22794 MW

NTPCs share on 31 Mar 2004 in the total installed capacity of the country was 19.4% and it contributed 27.1% of the total power generation of the country during 2003-04.

The following are the main business areas of NTPC:1) Generating Electriciy 2) Consultancy Services (Power Sector Related) 3) Renovation and Modernization of power plants

It is providing power at the cheapest average tariff in the country.

NTPC held its public issue on 5th November 2004 where the government divested 10.5% of its stake to FIIs, FIs and the general public. The offer price of the issue was at Rs 62.50 per share. The issue got oversubscribed a number of times.

The following are some of the positive associated with the company leading to the good response to the issue:

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1) 80% capacity expansion over next seven years to drive earnings NTPC has already taken steps to increase its capacity by 49% by FY09 and plans to further raise its capacity to 39,000MW by FY12 end. Even with these additions, Indias power shortage looks likely to rise from current level of 7%, implying that NTPCs new capacity can be easily absorbed.

2) Power Sector Reforms offer great growth opportunities (Covered in the earlier sections of this report)

3) Stellar past performance vis--vis capacity addition and power generation

From the above chart we see that NTPC has increased its capacity for electricity generation 10 times over the last 20 years.

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It has also shown an improvement in efficiency and has improved the ratio between the number of units generated and the capacity installed.

4) Robust growth plans in place

NTPC has drawn up a detailed Corporate Plan for the period 1997-2012 which represents the company's collective optimism and enthusiasm, inspired by a glorious past, a vibrant present and a brilliant future. The capacity addition plans that we have drawn up for the fifteen-year period using all the above strategies to enable the corporation to become a 40,000 MW company by 2012 A.D. In addition to the above, NTPC also has plans to venture into the following areas: Renovation & Modernization of old power stations through a separate joint venture company;

Investment in LNG terminal; Investment in coal mining and washeries; Setting up of power plants abroad; Joint ventures for ash-based industries; Setting up of small pilot plants using renewable energy sources; Setting up of hydel power plants to facilitate techno-economic operation of thermalhydro mix of NTPC stations;

Setting up of associated extra high voltage transmission lines / inter-regional EHV transmission lines so as to ensure evacuation of power from NTPC stations.

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FINANCIAL PERFORMANCE As compared to its physical performance its financial performance also has kept pace and the company has done well over the years. For the year ended 31st March 2004, the total income stood at Rs 25964.2 crores showing a 51% increase over a four year period. The total expenses were placed at Rs 20056.2 crores showing a 49% increase in the four year period. The Net Profit After Tax as on 31st March 2004 stood at Rs 5260.8 crores showing a 43% increase over a four year period. The earnings of the company have been relatively stable and investment in this company could be looked upon an investment in a bond providing marginally increasing returns year after year. The following has been the performance of the stock after its listing:

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Though the issue price of the stock was Rs 62.5 it opened trading at Rs 75 and since then has moved on to range of above Rs 90 per share. The company has also declared a 12% interim dividend in February. 10th March 2005 was the record date for the same. Based on its projected EPS of Rs 5.9 for the year ending March 2005, its PE Ratio, as compared to the other players in the industry, is steep at 15. However the company commands a premium over the other players in the sector since it is the largest and the most efficient producer of electricity in the country.

TATA POWER
Incorporated in 1919, Tata Power Company Limited (TPL) was promoted by the Tatas. It has worked in tandem with its sister companies (now merged with itself), the Tata Hydro Electric Power Company (Tata Hydro) and the Andhra Valley Power Supply Company (Andhra Valley). TPL pioneered the generation of electricity in India nine decades ago.

Today, it is the country's largest private power generating utility, established as a licensee in Mumbai and with ambitious expansion plans from being essentially Mumbai-centric to a major national player, not only in the fields of Power but also in Energy and Broadband Communication. The Company has got thermal, hydro, gas and even wind power based producing units. The details of its capacities is given as under:

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Total Location Capacity(MW) Fuel Khopoli 72 Hydro Bhivpuri 76 Hydro Bhira 150 Hydro Bhira 150 Hydro Trombay, Maharashtra Unit 4 150 Gas / Oil Unit 5 500 Gas / Oil Unit 6 500 Gas / Oil Unit 7 180 Gas Jojobera 67.5 Coal Wadi 75 Coal Jojobera 120 Coal Belgaum 81.3 Diesel Oil Ahmednagar 17 Wind Jojobera 120 Coal The company today has got a combined capacity of 2258.8 MW. Besides Tata Power also offers its expertise for the following activities:

Setting up Independent Power Plants (IPP) Setting up Captive Power Plants (CPP) Power Transmission and Distribution Projects Operation and Maintenance Services (O&M Services) Remnant Life Assessment (RLA) and Performance Evaluation Services of Power Plant Equipment

Overseas projects : Erection, Testing, Commissioning & Trial operations Power Plant/Utility Operations Management and Plant Operators Training

POSITIVES FOR THE COMPANY:

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1) The company will get benefited by the governments move towards encouraging greater private participation in the private sector and can now look at even alternative expansion plans in transmission and power trading since these have been opened to participation to the private sector.

2) The company has shown a very decent performance in its Delhi operations. The Transmission Losses in Delhi are down to 36.4% in September 2004 as compared to 55% in July 2002.

3) Value of Investment works out to around Rs 137 per share. Investment Tata Telecom Tata Sons / TCS Tata Petrodyne Others Total Value Rs 1450 cr Rs 870 cr Rs 320 cr Rs 90 cr Value per share 73 44 16 4

4) Steady nature of revenues make its business like a cash cow.

FINANCIAL PERFORMANCE
Description Net Sales Other Income Total Income Expenditure Operating Profit Interest Gross Profit Depreciation Profit before Tax 2002-03 2003-04 43,005.00 42,390.80 1,520.30 44,525.30 -31,163.40 13,361.90 -3,412.10 9,949.80 -3,180.40 6,769.40 1,599.90 43,990.70 -30,471.30 13,519.40 -2,837.20 10,682.20 -3,339.50 7,342.70

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Tax Profit after Tax Net Profit Equity Capital Reserves EPS

-1,570.20 5,199.20 5,199.20 1,979.10 39,594.60 26.27

-2,251.90 5,090.80 5,090.80 1,979.20 42,779.80 25.72

Thus we see that at the current price of Rs 400 the company trades at a PE Multiple of 15.55. However if we subtract the value of the investments we would get an adjusted PE of 10.2. Thus the valuations at the present moment seem to be reasonable. The company is in a position to take advantage of the investments it has and generate free cash flow that can be utilized for its expansion plans in the future.

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We see that the stock price of the company is in an upward range over the last 2 years in line with the positive developments taking place in the power sector. However the company is subjected to regulatory changes and any adverse developments on this front can have negative implications for the stocks performance.

RELIANCE ENERGY LTD.

Reliance Energy is Indias largest integrated private sector power utility company. The company is into generation, transmission, distribution and trading of power. It distributes over 5,000 MW of power - the largest in the country. Reliance Energy powers 2 out of 3 homes in Mumbai and 1 out 2 in Delhi and has a consumer base of 2.5 crore in Mumbai, Delhi and Orissa. The company formerly known as BSES Ltd. was taken over by the Reliance group in the year 2003 and subsequently its name was changed to what it is now. The takeover was completed on 18th Jan 2003 at an offer price of Rs 230 per share. The 940.59 MW Generation capacity of the Company comes from five projects:

Dahanu TPS the 2x250 MW multi fuel based thermal power station at Dahanu near Mumbai.

7.59 MW Wind Farm Project at Jogimatti in the district of Chitradurga in Karnataka. BSES Kerala Limited: The 165 MW combined cycle power station at Kochi, Kerala. BSES Andhra Power Limited: The 220 MW combined cycle power plant at Samalkot in Andhra Pradesh Goa Power Station : The 48 MW naptha based combined cycle power plant at Goa.

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Extensive Distribution Network:

Seven decades of experience and continuous investment in modernizing its distribution infrastructure have helped the company achieve the enviable distinction of operating its network with 99.99% reliability. Reliance Energy Ltd. has established 4124 distribution sub-stations, 2912 km of high tension (HT), 2966 kms of low tension (LT) cable and 2466 kms of streetlight cable. The company has an installed distribution transformer capacity of about 2422 MVA. During the last five years (1998-2003) the installed capacity of power transformers has increased from 1502 MVA to 1752 MVA. The present maximum demand for the area is around 1226 MVA. The ratio of installed capacity to maximum demand is 1.43. The ratio of distribution transformer capacity to the maximum demand has gone up from 1.82 to 1.98.The efforts made towards achieving higher levels of efficiency have reduced distribution losses to 13.4% - which is perhaps the lowest in the country. Today the company caters to 5 million customers. Reliance Energy Limiteds Mumbai operations cover a population of 9.0 million within an area of about 384 sq. kilometers. The Distribution network handled and sold 5,879.66 MUs in the year 2002-2003. Besides Reliance Energy has got the following subsidiaries in different states: New Delhi: BSES Rajdhani Power Ltd BSES Yamuna Power Ltd Orissa: WESCO NESCO

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SOUTHCO POSITIVES FOR THE COMPANY: 1) It has been able to bring down the AT&C Losses to around 13.5% as mentioned before. With every 1% reduction in the AT&C Losses the net profit of the company will grow by Rs 28 crores. 2) Reliance Energy holds an exclusive licence to supply energy to suburban Mumbai upto the year 2012. 3) It has ready availability of power supply from its own plant and Dahanu and the balance from Tata Power Company for its Mumbai distribution operations. 4) It has issues FCCBs that can be converted into shares at Rs 245 per share at any time between Dec 2002 and Dec 2007. These FCCBs are deeply in the money. Upon their conversion into equity shares Reliance Energy would be able to raise Rs 2700 crores as long-term debt while maintaining the debt-equity ratio at 1:1.

FINANCIAL PERFORMANCE Description Net Sales Other Income Total Income Expenditure Operating Profit Interest Gross Profit Depreciation Profit before Tax Tax 2002-03 2003-04 26,918.50 33,995.10 848.5 1,832.70 27,767.00 35,827.80 -22,879.00 27,767.70 4,888.00 8,060.10 -763.5 -699.3 4,124.50 7,360.80 -2,598.10 -3,187.20 1,526.40 4,173.60 96.9 -431.4

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Profit after Tax Reserves EPS

1,623.30 3,742.20 24,006.70 1,752.60 8.85 25.86

We see that the EPS has almost trippled for the stock in the between 2003 and 2004. At the current price of Rs 560 the stock trades at a PE multiple of 21. The stock may seem a bit expensive but the company had come up with announcements in between to pick up the stock all the way down to Rs 520. Hence the stock has remained at these high levels.

Like the other stocks in the power sector even Reliance Energy is seen in an uptrend following positive developments on the power sector front for the entire power industry.

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BIBLIOGRAPHY
PUBLICATIONS: Argus Global Markets Asia Pacific Energy Research Institute International Energy Agency Bulletin Economic Times Business Line

WEBSITES: Powermin.nic.in Cerc.nic.in Ntpc.co.in Yahoo India Finance www.indiainfoline.com

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