Grid interlinking - More power to southern states likely from January 2014

On January 14, a single national power grid would allow seamless pan-India flow of electricity in uniform frequency. State-owned transmission utility Power Grid Corporation is set to charge its high-voltage (765 KV) transmission line between Solapur in Maharashtra and Raichur in Karnataka by the second week of January, ending isolation of the southern grid, which has remained technically cut-off from the north, east and western grids. The integration of the grids would enable consumers in south Indian states to access electricity at competitive rates from generators in the north, who produce surplus power.

"The project to connect southern grid with high-voltage AC transmission line is in the final leg of execution. We should be handed over the line by contractors in the first week of January so that it could be made operational by January 14," Power Grid CMD RN Nayak said. He added that though the southern grid was even now connected with the rest of the country, it was through a high-voltage direct current (HVDC) line that does not allow synchronous flow of electricity in a uniform frequency, but merely acts as a tap for regulated supply of power. This prevented the southern grid to automatically access surplus power available on the grid at various points of time to meet its deficit. Southern grid is one of the five regional grids in the country. While the other four — north, west, east and the northeast — are part of one national grid, the southern grid has remained isolated. While the lack of transmission link to the south has often resulted in higher prices of power in the region, this also came a blessing in disguise during the northern grid collapse on July 30-31 last year when the region remained unaffected while large parts of the country suffered blackouts.

The southern grid connectivity project involves putting in place two circuits of 2,100 MW each on 765 KV lines. While Power Grid Corporation will make the single circuit line of 2,100 MW operational in January 2014, the other line being constructed by Patel Engineering may be up and ready later in the year. Together with the existing HVDC line, this would enable the deficit-prone southern region to get access to about 6,000 MW of power, including 4,000 MW at uniform frequency. "Most of this power would be available at a much cheaper price than that from the exchanges," said Alstom T&D India country president and managing director Rathin Basu. Alstom T&D is a large player in the Indian transmission market, accounting for about 19% of the equipment and technology market.

As per an India Energy Exchange official, who did not want to be quoted, the connection of southern grid with the rest of the country would push down the price of electricity traded in the region. While the rest of the country (barring Rajasthan and UP) are getting power using the exchange platform at round R2.28 a kWhr (IEX average price for June to November period of 2013), Tamil Nadu and Kerala have bought power at an average price of R4.79 during the period. Andhra Pradesh and Karnataka bought power at a slighly lower average price of R4.02. Prices have been much higher during peak summer months when demand shoots up.

"The tariffs would definitely head south in the region as the corridor booking charges there are high at R3-3.50 per unit, leading to peak power spot price of R7-7.5 per unit against a national average of R3.5-4. In addition, the region faces huge deficit of power. The Kudankulam nuclear power plant, which was to supply 2,000 MW of power to the region, has got delayed and not reached full load yet," said Deloitte senior director Debasish Mishra. Basu said while the new connection will definitely help the region, the benefits could get limited if states did not improve the intra-regional and intra-state transmission network to access the flow of power in the grid. Tamil Nadu, for instance, faces severe constraints in its transmission network. "Single grid will also mean power generators, particularly in northern parts of the country, could find buyers in the deficit-prone south, thereby improving their capacity utilisation," said a power sector expert.

Source - Financial Express