Energy Handbook India

8/3/2019 Energy Handbook India

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P o w e r S u m m i t - T h e E n e r g y H a n d b o o k 2 0 1 1

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C o u n t r y P r o f i l e

India


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C o u n t r y P r o f i l e : I n d i aP o w e r S u m m i t - T h e E n e r g y H a n d b o o k 2 0 1 1

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The power sector needs to expand

rapidly if the country is to

continue on its path of economic

development. Indias current installed

capacity is about 150 GW and this needs

to go up to nearly 800 GW in the next

fifteen years, says Baba Kalyani, owner

of Bharat Forge and one of Indias most

celebrated industrialists. The power

market is the biggest opportunity in the

Indian manufacturing sector today.

According to some estimates there are

as many as 400m people without access

to electricity in India, the Government

having failed to meet the 2005 RGGVY

plans target of connecting all villages

to the grid by 2010. Dr. J.M. Phatak,

Chairman and Managing Director of the

Rural Electrification Corporation and

the man tasked by the Government

with funding rural electrification, notes:

Income per capita is growing at a faster

rate in rural areas that in urban areas

Therefore it is expected that demand

for electricity will grow at a faster rate

in the countryside. Development of

Indias power sector will require not just

investment in new generation capacity

and upgrades to the existing transmission

and distribution (T&D) infrastructure, but

also a new greenfield T&D infrastructure

capable of supplying a population larger

than that of the USA. India has changed

dramatically in the space of a decade.

This was the power market where Enron

first started to unravel publicly, and issues

surrounding Enrons Dabhol plant have

deterred international investors from the

generation sector for many years. After

the plant finally shut in 2001 the country

embarked on a second phase of power

market liberalisation culminating in the

Electricity Act 2003.

India in Focus

The Indian power sector presents one of the largest business

opportunities in the world at present. India, the worlds second

most populous state, combines rapidly growing demand with acrippling 12 percent power deficit.

Since the reforms of 2003 Indian private-

sector investors have become extremely

active in generation, but the major foreign

players are notable by their absence.

When the sector was initially opened

to investment there was an abundance

of investors. But the experience was

not pleasant for some of them, which

explains the current reticence on the

part of international investors to re-enter

the market, says the manager of the

power sectors largest debt portfolio,

B.K. Batra, Executive Director & Group

Head of Corporate Banking at IDBI Bank.

Batra argues: This is the time for major

players to reconsider India and perceive it

as an attractive area for investment. ROI

is at an impressive level of 15.5 percent,

which strengthens the business case for

investing in the power sector.

For the power equipment manufacturer or

service provider, India presents the perfect

combination of demand and supply. The

Indian power manufacturing sector is

still dominated by large state-controlledcompanies, both producers and clients,

and is not perfectly liberal. The market

is open to new entrants, however, and

international companies are rushing to

secure joint ventures with local partners

as they enter the country.

Power is a concurrent subject in India,

meaning that it falls under the jurisdiction

of both the central and state Governments.

This division of authority has led to a

wide variation in investor activity across

the country, with the more liberalised

and creditworthy states enjoying the

most development. The prime central

Government law regulating the power

sector is the Electricity Act 2003, which

revised earlier attempts at liberalisation

and has resulted in a solid and stable legal

framework for private-sector involvement

in the Indian power market.

Generation

India has a total installed capacity of

162 GW and generated some 803 TWh in

2007. India is now the worlds fifth-largest

producer of electricity, representing

4.1 percent of total world output in 2007

according to the International Energy

Agency. Given that Indians represent over

17.3 percent of the worlds population,

Article by:

Oliver Cushing and

Jolanta Ksiezniak

Section Cover

(previous page):

CLPs Wind

Power Project,

Photo courtesy ofCLP Power India

Private Limited

Above:

A crowd gathers

in front of the

Mysore Palace, lit

up for the Dasara

festival

however, there is clearly space for

growth. The Government has set out

plans for capacity to more than double

by 2017. Generation has traditionally

been the exclusive domain of central

and state-owned companies, in some

regions integrated with transmission and

distribution operations to form utilities.

Today the largest generation company

remains the central-Government-

controlled National Thermal Power

Corporation (NTPC), with 30,600 MW of

capacity generating some 27 percent of

the nations power output in 2009. Fellow

public sector undertakings National Hydro

Power Corporation (NHPC) and Nuclear

Power Corporation of India Ltd (NPCIL)

run 5,300 MW and 4,500 MW of capacity

and generate 2.2 percent and 2.4 percent

of the nations output respectively. The

private sector controls only 13.5 percent

of Indian generation capacity, state-

owned generators own 52 percent, and

central Government is responsible for the

remaining 34 percent.

Government policy since the Electricity

Act of 2003 has been that private capital

should fund the majority of capacity

addition. The market has been opened

to private investment in three ways.

First, the Government has floated the

public-sector undertakings, raising capital

through a series of initial public offerings

that have seen up to 33 percent of

equity sold to investors. Although the

public-sector undertakings remain very

much in the control of the Government

and there are limits on who may own

shares, the fresh capital has allowed the

under-funded generators to invest in new

projects and they are increasingly acting

as joint venture partners.

The Act also permitted any company or

group of companies to develop captive

power plants. This ruling has had a

substantial effect on the wider sector.

Industrial users are charged higher rates

for power and are far more likely to pay

their bills than their fellow consumers

in the retail market. Allowing industrial

consumers to generate their own power

has forced distribution companies to

strengthen collection efforts and freed

industrial consumers from paying cross-

subsidies.


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Many of todays

independent power

producers (IPPs) started out

as captive power divisions

of their parent companies:

Indias ever-dominant

industrial conglomerates.

As Dr. R.P. Singh,

Executive Vice-Chairman

of Jindal Power, explains:

We first entered the

power sector when we

constructed a captive plant

for a steel mill. Once we

had successfully executed

the first project for Jindal

Steel & Power Ltd. we

decided that we should

become a major power

player in our own right. By

2009 we had commissioned Indias first

private-sector mega power plant.

The 2003 Act reworked legislation

designed to create IPPs. Indias industrial

conglomerates have seized the opportunityto enter the sector and power generation

has become a core business line for many

of the nations largest companies. NTPC

may still be the largest power generation

company in India but the likes of Tata

and Reliance ADA are fast catching up.

Reliance was not even in the power

business a decade ago, but as Ashwani

Kumar, Head of Business Development

at Reliance Power, explains: We are

currently in the process of substantially

expanding our generation portfolio from

about 1 GW to approximately 35 GW

We are diversified geographically, in terms

of fuel type and in terms of our customers.

Reliance Power aims to be the leading

power generation company in India. TheTata Group built and operated Indias first

large-scale hydro plant in 1915 and has

been in the industry ever since. While

central and state Governments came to

dominate the sector after independence,

Tata maintained its foothold in the power

game and today it is Indias largest private-

sector generator, with 3 GW of installed

capacity. Tata Power is almost 100

years old, explains Banmali Agrawala,

Tata Powers Executive Director of

Strategy and Business Development. We

started off by building hydro projects,

with a vision of providing cheap, clean

and reliable power to the city of Mumbai.

Since deregulation in 2003 Tata Power

has become the only private-sector

company to be present in the generation,

transmission and distribution sectors.

Tata Power is also set on exponential

growth: the firm currently has 6 GW of

capacity slated for completion by 2015

and Agrawala says it is aiming for 25 GW

by 2017.

Coal and Gas Power

Currently 53 percent of Indias generation

capacity is coal-fired, and this dominance

is set to continue in the medium term;

India, poor in oil and gas, is coal-rich.

Gas, both from new fields and imported,

will play an increasingly important role in

power generation in the coming years.

India, already host to the worlds fifth-

largest fleet of wind turbines, has placed

major emphasis on renewable energy as

part of its 12th five-year development

plan (due to commence in 2012). Nuclear

power forms the fourth pillar of Indias

generation matrix, but new reactors are

likely to only play a small role in the next

decade.

India is the third-largest producer of coal

in the world and the third-largest importer.

With 85 GW of capacity to feed, and

considerable new development under

way, king coal looks set to dominate

the sector for the medium term. One

of the Governments key strategies to

encourage investment in the power sector

has been the creation of special-purpose

vehicles to fast-track 14 ultra mega

power plants (UMPPs) each of 4 GW

plus, to create 60+ GW of new privately-

owned coal-fired capacity by 2017 with

low risks for investors. The Ministry ofPower acquires the land and (where

applicable) coal rights, and undertakes all

the clearances and permitting needed to

develop a project. Companies then bid for

the tender on an operating cost basis. So

far four UMPPs have been awarded.

Despite Indias vast reserves of coal, most

new plants under development are on the

coast due to weaknesses in the transport

infrastructure. The supply of coal in India

is becoming a challenge, even for some

of the existing plants, says L.K. Gupta,

Joint Managing Director and CEO of JSW

Energy Ltd. The location of mines makes

them difficult to develop. Despite the rail

linkages provided by the Government,

the efficiency of coal supply is poor.

Nevertheless, we are fully committed to

ply the domestic linkages for our plants.

But to safeguard the sustainability of our

plants we decided to install them next

to ports, facilitating the use of imported

coal.

Indias continuing reliance on coal

has attracted international concern

on environmental grounds; not only is

consumption high and growing fast, but

Indias coal is of a low grade, with high

sulphur and ash content. Those within the

industry note however that India badly

needs coal-fired capacity if the country is

to continue to reduce poverty.

Today the USA generates thrice as much

electricity from coal as India does, notes

Reliance Powers Kumar. Natural gas or

renewable sources of power alone cannot

provide the 150 GW of capacity that the

country is looking for in the next seven

to ten years. Once we decided on having

coal-based power in our portfolio, we

observed that the best way to do it was to

control the entire value chain to mitigate

the risks. With Indian emissions of

greenhouse gases per capita a fraction of

those in the west (Indias CO2 emissions

per capita are less than a third of the

global average) there is an international

consensus that the countrys emissions

will inevitably have to rise.

Those within the industry are keen to see

coal developed in a responsible manner,

and tend to view coal as one part of a

wider portfolio development strategy

which will include sources which emit

less CO2.

We recognise the threat of climate

change there is no doubt that managing

carbon is a business risk, says Rajiv

Mishra, Managing Director of CLP.

We recognise the

threat of climate

change there

is no doubt that

managing carbon is

a business risk.

Rajiv MishraManaging Directorof CLP


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However, we did not want to marginalise

ourselves as a pure renewables player; we

want to be part of the mainstream solution.

There is a requirement for conventional

energy within our region. In India flue-gas

desulphurisers are not required and we

are the only company to have made a bid

on the basis that we will implement an

FGD. We recognise that renewables must

also be an integral part of the solution,

and we are now the largest developer of

wind farms in India.

Indias lack of domestic gas reserves,

and its inability to build a pipeline from

Central Asia or Iran through neighbouring

Pakistan, has prevented the development

of significant gas-fired generation

capacity. Joint Secretary at the Ministry

of Petroleum and Natural Gas Sunil Jain

explains: Worldwide, gas represents

some 30 percent of the energy basket; in

India it is only 9 percent. India has a huge

appetite for natural gas, and demand is

only constrained by supply and the supply

network itself.

Gas from the Krishna Godavari basin is set

to increase Indias production dramatically,

and exploration work is underway across

the country. A long-running court case

involving Krishna Godavari gas supplied

by Reliance Industries to Reliance ADA

has recently been resolved and the pricing

mechanism and allocation system has

been clarified as a result.

The Government is keen to encourage

further exploration, and Jain notes:

India has a very friendly regime when

it comes to oil and gas, I think one of

the best in the world. Last year, during

the global economic crisis, our latest

round of block licensing was fully

subscribed. Gas-fired capacity is set

to grow substantially in the coming

years (Reliance Power alone intends

to build 8 GW of capacity) though the

combination of ever-increasing load and

competition from alternative uses for

gas will ensure that it does not become

a dominant source of power in the

medium term.

Renewables

Renewable energy is a hot topic in India,

as in many other countries. Indias

objectives are threefold when it comes to

renewables: build a large-scale industry

which will generate jobs and export

revenue, demonstrate a commitment

to reducing emissions relative toeconomic development, and go some

way to achieving energy independence.

Renewable sources of power have the

potential to play a significant role in the

electrification of rural India.

As a means of addressing Indias energy

deficit crisis, renewable sources have a

dual role to play: aside from the obvious

capacity addition they are also an ideal

source of distributed energy. As Rabindra

K. Satpathy, the man in charge of solar

at Indias largest corporation, Reliance

Industries, observes: We believe that

distributed power will play a crucial role

in the development of India, instantly

cutting the 37 percent transmission anddistribution losses. With an installed

capacity of over 12 GW as of mid-2010,

and a substantial home-grown turbine

manufacturing industry, India has already

achieved a strong position in the wind

sector. Under the 11th Five Year Plan

(due to conclude in 2012) the Government

envisaged 10,500 MW of new capacity, of

which more than 5 GW had been installed

by mid-2010. The Ministry of New and

Renewable Energy appears confident that

the remaining capacity will be added by

the end of the plan.

Across the world most government

targets for wind energy have been

missed, yet India (which met the targetfor its 10th Five Year Plan in 2006)

seems to have implemented a strategy

that works. Co-founder and Director

of wind farm developer Veer Energy

and Infrastructure Ltd Dhimant J. Shah

says: The Government has made it

a regulation that every energy service

provider has to provide up to 7 percent

of their energy sourcing from renewable

energy. We are happy with the way that

we have progressed. The model works

here in India but it may take some time for

manufacturers, developers and investors

to get used to it.

In hydro power India has phenomenal

potential. The Government distinguishes

between large- and small-scale hydro,

with only schemes of up to 25 MW

qualifying for full-scale renewables

support. Sameer S. Shetty, Managing

Director of Indias largest producer of

small hydro turbines, BFL (a Fouress

Group company), says: The market has

huge potential, but the the disconnect

between potential and realisation is quite

big. There is 22 GW of viable identified

capacity for small hydro but India is

building 600700 MW annually at best.

Power is a state subject and even though

the Central Government and the Central

Ministry determine a framework, they

have no means to ensure that the state

fulfils its requirements. Nevertheless,

a substantial number of small hydro

schemes are under development and

among the great variation between states,

some have a supportive and pragmatic

attitude to small hydro.

The private sector, with a handful ofexceptions, has proven reticent to take

up the challenging of developing Indias

numerous large-scale hydro opportunities.

Nimish Patel, Director of Indias largest

dam and hydro tunnelling company,

Patel Engineering, says: Thermal plants

have predictable time lines and you can

commission a plant in three to four years.

Hydro however requires long investigation

periods and the schemes can take a very

long time to get approved. Research

reports are not always up to standard

and thus the private sector has been

very wary of these risks. Things are

beginning to change and some extremely

successful hydro schemes have been

developed by private-sector investors.Bhilwara Energy developed its first hydro

scheme in 1995, and unlike early private-

sector thermal plants it has proven to be

a commercial success. Riju Jhunjhunwala

of Bhilwara Energy explains: We recently

commissioned a new 200 MW plant in

India and are looking into developing a

much larger plant in Nepal. The land is

already acquired, infrastructure is being

developed, and the tender documents

are being prepared. All the electricity

generated there will be sold to India. By

2015 the company intends to have 3 GW

of installed capacity under operation.

Q Please could we start

with a brief overview of

IEX and how it came to

be established?

A In 2006 the CERC

realised that it was

important for India

to have a live trading

platform for power and

initiated a programme to

establish one. In 2007

a consortium lead by

Financial Technologies and key private players in

the energy sector got approval to start developing

an Indian power exchange and agreed a deal with

the Scandinavian power exchange, Nordpool.On

22nd June 2008 we went live with the Indian

Power Exchange. We sell power here on an

hourly basis. The bidding is done blindly so as to

ensure a fair playing field, it is a futures market,

but a short term futures market. In a very short

period of 24 months we have come to have more

than 400 traders on the Exchange. This is an

impressive uptake by any measure, but given the

economic problems of 2008/9 it is superb.

Interview with Jayant Deo

Managing Director and CEO, Indian Energy Exchange

Q The IEX is the only power exchange operating

in a market in which there is a deficit, how does

this affect the dynamic of the Exchange?

A India is a vast and varied country, daily peak

demand in the east will not fall at the same time

as in the south, and peak supply during the rainy

season in the north (where many hydro facilities

are located) does not match peak demand there.

While net demand is higher than net supply in

India, we have found that the market did not

ensure that all power being generated was

consumed, the IEX helps address this issue.

Q How easy is it for you to sell the concept of

merchant trading to a generator?

A A companys decision to go merchant or not

will of course be informed by their appetitive for

risk and their debt profile. For most generators,

entering a fixed term contract for 50 or 60% of

their output makes a project viable as it satisfies

lenders that there is a secure income stream to

pay debt, they may chose to sell the remainder on

the IEX as it gives them exposure to the upside

that the Indian energy growth curve presents.


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With such a vast potential and a

commitment to managing its emissions

of greenhouse gases, India needs to

encourage substantial private-sector

investment in large-scale hydro schemes.

One solution might be to reconsider the

rules distinguishing large-scale hydro

schemes from their smaller siblings, as

Patel argues: We need to consider allhydropower as renewable, which will

allow developers to sell their output

for more profit, therefore making the

sector more attractive and increasing

investment. India was an early pioneer

in the use of biomass as an energy

resource, with efforts initially focused

on farm waste gasification. Attention is

now being given by both the Government

and the private sector to generating

electricity from biomass. With the worlds

largest rural population and multiple large

metropolises that have yet to come to

grips with the disposal of urban waste,

there exists a window of opportunity

to integrate energy generation into the

waste management system.

One early mover in biomass is power

transmission engineering and waste

management group A2Z. This company

aims to become an engineering expert

in the field as well as an independent

power producer in its own right. We

are now setting up three new biomass

power plants, each of 15 MW capacity,

integrated with the sugar industry, says

Rakesh Aggarwal, Chairman and Managing

Director of A2Z Powercom. Our strategy

with setting up these plants is to be able

to integrate with any industry that has

agri-waste or municipal waste. A very

important factor for the smaller renewable

energy plants is that they are exempt fromenvironmental clearance. Construction

time is less than a year, which is a much

better proposition compared to other

kinds of power plants.

Much of India is blessed with high and

consistent levels of solar radiation. The

central Government and a number of states,

which are competing to become Indias

solar manufacturing hub, have introduced

attractive subsidies to foster development

of solar power. Central, state and city

governments are providing householders

and businesspeople with support to install

photovoltaic (PV) panels and thermal

water heaters at the distributed level. One

pioneer in this field is Delhi. Delhi has hadthe reputation of being power cut city,

explains Rakesh Mehta, Chief Secretary

at the Government of the National Capital

Territory of Delhi. Mega-cities like Delhi,

which depend almost exclusively on power

to meet their economic needs, will have to

find new and innovative solutions to meet

their requirements. As part of a wider

campaign to reduce pollution and improve

the electricity supply Delhi has adopted

a large-scale programme to promote

solar water heaters, giving subsidies of

up to 6,000 rupees ($130) for 100-litre

systems in the domestic sector and up to

60,000 rupees ($1,300) for commercial

buildings.

The Jawaharlal Nehru National Solar

Mission is a nationwide scheme to promote

PV usage. Dr. Farooq Abdullah, Union

Minister for New and Renewable Energy,

says that the Mission has twin objectives:

To contribute to Indias long-term energy

security as well as its ecological security.

The rapid development and deployment

of renewable energy is imperative in this

context, and in view of high solar radiation

over the country, solar energy provides a

long-term sustainable solution. The Solar

Mission recommends implementation in

three stages, leading up to an installed

capacity of 20 GW by the end of the

13th Plan in 2022. What we do in the

next three to four years will be critical.Therefore, the Cabinet has approved the

setting up of 1,100 MW of grid solar

power and 200 MW of off-grid sol ar

applications utilising both solar thermal

and PV technologies in the first phase of

the Mission. In addition, the Mission will

also focus on R&D and human resources

to develop and strengthen Indian skills

and enhance indigenous content to make

the Mission sustainable.

The private sector has reacted favourably

to the Mission, though Reliance Industry

Groups Rabindra K. Satpathy notes: We

still have to confront a lot of assumptions

regarding reliability and expense. Currently

solar costs 12.5 rupees per unit, againstabout 3 rupees for coal and gas. But if

you add other costs, such as transmission

loss, that is pushing the price up to 4 or

5 rupees. Reliance Solar wants to bring

the cost of PV cells down to $2/MW of

capacity, Satpathy says. We want to

speed up the pace of installation as this

will give PV a major advantage over other

generation types. Solar projects are not

controversial and can be built quickly.

Also, they are not subject to trade

embargoes: no one can stop the sun! We

have seen that people want a high quality

of power, which PV can provide. We

want to make solar power affordable to

the masses. India has refused to signed

the Nuclear Non-Proliferation Treaty and

for three decades it was blocked from

trading with the Nuclear Suppliers Group.

In 2008 an American-brokered deal saw

India re-enter the world of international

civilian nuclear trade and the country has

set out a route map to increase i ts nuclear

fleet more than thirteen-fold, to 63 GW,

by 2032.

Transmission, Distribution

and Trading

Indias transmission and distribution

(T&D) sector has been the silent sister

of generation since 2003, but over the

coming decade this is set to change

dramatically. As the private sector has

rushed to spend billions of dollars on

new generation capacity, only a handful

of distribution concessions in Delhi and

Mumbai have been privatised. Instead,

new transmission lines have invariably

been built by the Government-controlledPowerGrid Corp., sometimes in joint

ventures with private-sector partners.

Amul Gabrani, Chairman and Managing

Director of transmission engineering

company Hythro Power, explains the

situation in T&D: The public-private

partnerships in the power sector started

in the generation side. Originally,

transmission lines were being delivered

by a single body, PowerGrid Corp. Now

the market is starting to liberalise and

there are more public-private partnerships

(PPPs) in the transmission sector. Since

there is a time lag between transmission

and generation, you will find increased

interest in transmission in the next twoyears. Gabrani is confident that the

private sector can help cut Indias terrible

T&D losses, which account for 37 percent

of all power generated. One of the

impediments in India has been the losses

because of the quality of equipment, he

says, but this will change and the pri vate

sector will look at more efficient systems.

Technical losses will go down and a lot

of groups are concentrating on this. Once

technical losses go down, the profitability

of the power sector will increase; this

will happen only with the support of the

private sector.

A small dam tobe constructed

at the valley of

Mahabaleshwar

Hill Station in

India for local

consumption, one

of the several

around the country


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I n F o c u s : D e l h i T r a n s c o L i m i t e d

Green Power for Green Delhi

Be it plantation, no-industry zones or 100% Commercial Vehicles

on CNG, Delhis obsession with Green is quite evident. No wonder,

Delhi has also engineered one of the greenest power generationand transmission systems. Clean and green production processes

of Pragati Power Corporation Ltd. (PPCL) and minimum loss

transmission systems of Delhi Transco Ltd. are at the heart of

Delhis Green Power Vision.

Power Foundation:

Pragati Power Corporation

Ltd. (PPCL) was started with a

mission to play a pivotal role in

the development of NCT and

uplifting of the living standards

of the citizens. The company

is committed to provide clean

& green energy with special

emphasis on sustainable

development by adopting

energy efficient technology for

power generation. The existing

and forth-coming projects are

the mirrors of self imposed

corporate standards for clean

& energy efficient technology products &

services. Delhi Transco Ltd was formed

in 2002 following the unbundling of the

erstwhile Delhi Vidyut Board under the

Delhi Electricity Reforms Act 2000.

DTL has been responsible for establishing,

upgrading, operating and maintaining the

EHV (Extra High Voltage) network in and

around Delhi.

Delhi Transco Limited:

A noteworthy achievement of DTL has

been the companys transmission loss

reduction. Transmission loss level has

been reduced from 3.84 per cent in

2002-03 to 1.38 per cent in 2009-10,

which is the lowest transmission loss

level in the country. For improvement of

operational efficiency, regular monitoring

and maintenance of equipment is carried

out through patrolling of transmission

lines and hotline washing of insulator

strings. Further the work of replacing

the existing 400 KV insulators with

polymer insulators is being carried out.

To ensure adequate and efficient

power supply for the citizens of Delhi,

DTL has been continuously upgrading

its transmission capacity and adding

transmission line to its system. The modern

technologies are being implemented in

DTL by way of constructing GIS sub-

stations at Ridge Valley, Indira Gandhi

International Airport (DIAL) as well as

other places.

DTL is also in the process of layi ng 220 KV

cables by employing cable link techniques

and would be the largest network of its

kind going to be established in India. Out

of all the projects initiated by DTL, the

work of two 220 KV GIS sub-stations has

been completed and will be synchronized

by the end of September 2010 after

testing. The work for 2 sub-stations of

400 KV and 5 sub-stations of 220 KV is

in full swing.

Powered by IT:

Following the e-Governance initiatives of

GNCTD and to enhance its efficiency and

productivity, DTL has initiated several IT

based projects. For constant access to real-

time data of the entire network, the utility

has implemented Supervisory Control and

Data Acquisition (SCADA) systems.

DTL has also carried out system studies,

adopting state-of-the-art-software.

Enterprise Resource Planning Software,

is being implemented which will offer anintegrated software solution to all the

functions of the organization. With ERP

software DTL will standardize business

processes and facilitate best practices

by creating more efficient systems

and concentrating its efforts towards

maximizing profits.

Power Finance:

DTL has achieved a commendable financial

turnaround after a three-year financial

engineering process. It has posted profits

in each of the past 4 years.

In 2008-09 DTL profits, after tax stood at

Rs. 634.9 million, an impressive 22.84%

increase over the Rs. 516.9 million

registered in the preceding year. The

company also paid a dividend of Rs. 90.8

million to the Government for 2008-09.

It has been accredited rating A+ Company

by top two rating agencies of the country

i.e. CRISIL and Fitch Rating India Ltd. This

is the highest amongst all state utilities in

the country.

Energy Audit: BEE accredited energy

auditors M/s Petroleum Conservation

Research Association (PCRA) hasconducted energy audit of the IPGCL

Plans.

All efforts have been made to run various

systems as per the designed parameters to

conserve energy.

1.Overhauling of the unit was carried out

as per the manufactures direction to run

the machine optimally.

2.2. 220 KV CVTs were installed in

each phase of all the three generators to

improve the accuracy of metering system

for the sale of energy.

3.The Auxiliary consumption of the Pragati

Power Station- 1 in the year 2009-10 was

2.85% and achieved the Aux. consumption

target 3%.

Sheila Dikshit

Chief Minister,

Delhi

New Projects of Pragati Power Corporation

Limited (PPCL)

Pragati Phase 3,Bawana,

Delhi (Gas based)

Pragati Phase 2, Bamnauli,Delhi (Gas Based)

Generation Capacity

Source: Delhi Transco Limited

Name of Project

1500 MW (1st unit

commissioned in Oct 2010)

750 MW (Proposed)


7/10

32 33

Q Please could you

start by giving us a

personal professional

background and an

overview of the power

sector in Delhi?

A I belong to the

civil services and have

had a long relationship

with the power sector,

having been the power

commissioner in Goa

and having managed the electricity sector in the

local body. Later on I became the CMD of Delhi

Transco and Chairman of Genco.

In 2001 the power sector in Delhi was

restructured and the Delhi Electricity Board

was broken up into seven companies: three

distributions, two generation, one holding

transmission and a holding company.

Q You were a panelist at the Copenhagen World

Summit on Climate Changes forum of the worlds

largest cities, what efforts is Delhi making to limit

its impact on the environment?

A To promote energy conservation and to

conduct energy audits of all majors buildings in

the city. The Energy Efficiency and Renewable

Energy Management Centre was established.

We have started investing in renewable energy

sources, it has been made mandatory for

large buildings to implement energy efficiency

measures, distribution companies have been

successful in promoting CFL lamps, on solar

water heaters subsidy is given from 6,000 rupees($130) to 60,000 rupees ($1,300).

We are also developing waste- to- gas plants and

have one operating in the canteen in my building,

which serves 5,000 people and have two plants

under development, One scheme will come into

operation in 2011 and will consume 1,500mt/ day

providing 16mw of capacity.

We have created an air ambience fund which is

essentially a very small tax on diesel. This creates

about 700m rupees ($15m) which we use to

subsidies by one third the price of electric vehicles.

Interview with Mr. Rakesh Mehta, Chief Secretary, Government

of N.C.T. Of Delhi, CMD of Delhi Transco and Chairman of

Pragati Power Corporation

Q The population of Delhi is projected to grow

substantially in the next decade, how is the

N.C.P. Government going to ensure that the

capitals energy needs are met?

A Two years ago we adopted a policy of load

growth generation keeping in mind that Delhi, a

city of 17 million people, is projected to grow to

24 million. We decided that 40- 50% of Delhis

supply should be generated within 40km of

the city. The power generation companies of

N.C.T Delhi have set up a 1,500mw plant 40km

near Delhi border in a joint venture with the

Government of Haryana and NTPC. The plant

can be upgraded by a further 1,000mw. Delhi

will receive 50% of the power. In Delhi we are

establishing a 1,500mw gas plant and a 750mw

gas plant, we are closing all three of our coal fired

Delhi plants which will have a huge impact on the

air quality of the capital.

Q Delhi Transco has really lead the way in India

in terms of cutting transmission losses, how has

the company achieved this?

A Transco has substantially cut transmission

losses, prior to privatisation they were 6% and

now they are below 1%. Delhi Transco has

completed 400kv ring around Delhi having a

capacity of 4000MW Load.

The new master plan 2021 has recently been

approved and it is projected that 700 sqkm of

territory on the outskirts of Delhi will be urbanised

over the next fifteen years. We are conducting a

major review to establish which areas are likely

to be developed in the next few years to identify

where to set up new substation infrastructure.

Delhi has had the reputation of being power cutcity, my vision is to make Delhi an inverter free

city.

Q What would your message be to our

international readership about the Indian power

sector and investing here?

A The Indian economy is growing at about

9% a year. Mega cities like Delhi, which depend

almost exclusively on power to meet their

economic needs, will have to find new and

innovative solutions to meet their requirements.

There is a great opportunity for people across the

world to become partners with us.


The Indian transmission network was

originally split into several regions. In

recent years PowerGrid Corp. has made

significant headway in interconnecting the

regions but there is still much work to be

done. India is a vast and varied country.

Daily peak demand in the east will not

fall at the same time as in the south, and

peak supply during the rainy season inthe north, where many hydro facilities are

located, does not match peak demand

there, says Jayant Deo, MD and CEO

of IEX, Indias new and fast-developing

power exchange. As the energy market

was structured on a regional basis, supply

has traditionally been built to meet local

demands and thus there was often a

mismatch between demand and supply.

India is developing a network of ultra-

high-voltage transmission lines to improve

regional interconnection and to transmit

power efficiently from the countrys new

mega and ultra-mega generation plants.

Indian transmission engineering firms are

rushing to meet demand in the sector.

One challenge, common throughout many

sectors of Indian industry, is security of

supply for parts and equipment. With this

in mind, many of the larger transmission

engineering firms have invested in their

own fabrication plants.

Technical T&D losses have been kept

high by lack of investment and a system

that has held back the adoption of new

technologies. As the private sector

becomes more involved in T&D the hope

is that losses will fall further.

Power transmission is a big area for

improvement, as the distribution lossesare very high well above 30 percent in

India compared to 1115 percent globally.

We are developing high-tech solutions

in order to cut the energy losses, says

Rajesh Agarwal, Managing Director of BS

TransComm. Looking to the future, PPPs

will increasingly be the chosen method

of development. The Government has

already budgeted $14bn via partnerships

with private companies, through the

Build-Operate-Transfer model. The private

players are just starting to enter the sector.

Within the next five to seven years there

will be a shift in this sphere.

Manufacturing

Like many of Asias other success

stories, Indias manufacturing industry is

dominated by three classes of company.

Large state-controlled enterprises, the

hangover of a three-decade dalliance with

socialism, have continued to prosper in

Indias increasingly free market. The privatesector is characterised by conglomerates

set on integration and diversification, while

young and aggressive firms are chasing

niche positions. India is a great incubator

of entrepreneurship Bharat Forges

Baba Kalyani notes: Indias growth is

largely dependent on the entrepreneurial

skills of our people and there is space

in the power market for smaller players.

However, this expanding market is likely to

be dominated by a handful of major Indian

and foreign corporations (often working in

partnership) with the smaller companies

operating at the lower end of the value

chain. As Kalyani observes: Energy, like

any other big market, is regulated. The

Government gets involved somewhere.

Therefore, knowing the system, knowing

how it works and having the network

always helps.

Manufacturing

unit; Photo

courtesy of Bharat

Forge.


8/10

34 35


The Indian parliament

recently adopted overtly

protectionist measures,

including the reintroduction

of an a tax on imported

power equipment.

State-owned generators,

including Indias largest

generator NTPC, are obliged

to favour domestically

manufactured equipment

if the price is within

15 percent of t he closest

foreign-made product.

These measures threaten

to undermine the countrys

generation capacity growth

objectives as well as

damaging the development

of a domestic industry.

For many years Indias power sector was

virtually a closed shop with privileged

status given to Bharat Heavy Electricals

Ltd. (BHEL), the Government-controlledmanufacturer of everything from turbines

to capacitors. Some 70 percent of

turbines in Indian power plants were built

by BHEL. Today, however, BHEL has

emerged from its protected position to

compete successfully in the open market,

and indeed has prospered in recent

years. Over the last five to six years we

have grown at a rate of 2025 percent

annually, our top line has tripled and the

bottom line quadrupled in a matter of

four years, explains B.P. Rao, BHELs

Chairman and Managing Director. In

2006 we had 6 GW/y capacity, in 2007

this was upped to 10 GW and in March

2010 we went to 15 GW. It is a sign of

quite how fast the market is growing andhow well the old monopolist has thrived

in the free market that 15 GW/y is stil l not

enough for BHEL; by 2012 Rao is aiming

for an annual production of turbines and

generators totalling 20 GW.

BHEL has placed great emphasis on

technological development, both as a

partner to foreign firms and more recently

through in-house R&D. While we started

out as a manufacturing organisation, we

have now become an innovation-driven

company, says Rao. Last year we spent

almost 2.5 p ercent of our turnover on R&D

and filed patents at the rate of nearly one

a day. The company followed the process

of acquiring technology through tie-ups

with many of the leading companies.

Today we have technology partnerships

with about 70 companies.

Exports and international collaboration

have played a major part in the

development of many Indian companies.

Looking to the future, CEOs see that

participating in the world market will not

only widen their markets but also help

them create world-class products. At

the end of the 1990s things were really

slow in India and the markets were not

doing very well, but we wanted to grow

the company and start exporting our

products, says Aditya Knanna, Director

of the switchgear and busbar manufacture

C&S. That was a significant point in the

company, and when we started getting

orders, we had to up our game in terms of

quality, delivery, logistics and aesthetics.

By the time the market opened in the early

2000s we were already there, which iswhy C&S is an anomaly today: we are

a small company competing against

multi-billion-dollar companies and have

managed to establish a strong market

position in India.

India on the World Stage

For many years Indian power service and

equipment manufacturing companies had

little option other than to look overseas

if they wished to grow. With a complex

and often corrupt tendering process

and only a few state-owned clients, the

domestic market was often stagnant and

impenetrable. Today the domestic market

is far more active and transparent, yetmany manufacturers still wish to increase

revenues and margins through exports.

Africa and the Middle East are the key

markets for most Indian export-oriented

companies, with neighbouring South

Asian countries such as Bhutan attracting

the attention of Indian generation

companies.

Africa is the new frontier for many Indian

companies who see that they have a

number of comparative advantages in

that continent. I believe that Africa

will be the most exciting area for this

company, says Khurshed Daruvala,

Managing Director of engineering and

contracting company Sterling and

Wilson. Daruvala notes that most African

countries take a pragmatic attitude to the

importation of labour and goods when

it comes to executing projects: Most

African countries allow Indian labour to

come and work, and also accept material

coming from India. 75 percent of the cost

of a project comes from India, which is a

real advantage for us.

Mohan Energy Corporation is an Indian

engineering firm established over 30

years ago specifically to target the

African market. Director Amitabh Agrawal

explains the Indian experience of Africa:

In the African marketplace it is hard to

distinguish between an Indian company

and a European company. African clients

are very clear about what they want and

if you are able to give them this t hen they

are happy to work with you. Africa is not

as price-sensitive as India; in India people

are entering pricing wars, which are notsustainable and have to compromise the

quality of the product. In Africa, people

understand that there is a minimum price

and they demand a higher standard.

Most of the time, the consultants and

supervising engineers come from western

countries and projects have to be executed

to the highest international standards.

It is an indication of the international

standards that Indian firms achieve

that they tend to focus on privately or

internationally funded projects rather

than on large, government-to-government

deals. Tata Consulting Engineers

has successfully carried out several

assignments overseas in south-eastAsia, the Middle East, Africa, Europe,

Asia Pacific, Australia and the Americas,

notes Vice President U.K. Hambarde.

Some of our projects were sponsored by

the World Bank, Asian Development Bank,

UNDP and other international agencies.

Our focus at the moment is the African

region, as it is a growing economy and

we have a lot of experience there. There

are many opportunities, especially in the

T&D sector. Indian firms have sometimes

struggled to overcome a perception that

they do not deliver to international quality

and time standards. Essar Projects,

one of Indias big three construction

companies, is working across the world

in a vast array of technical areas.

Essar is a national champion in the

construction and engineering sectors

and one of the largest and best-equipped

construction companies in Asia. CEO

Alwyn Bowden explains: There are a lotof misconceptions around, and in the past

Indian construction companies have not

always been highly regarded overseas.

Most of the labour for the international

sites has come from India and the skilled

work base is originating from here. The

Indian market has been very chaotic in the

past, but the management of the various

groups realise that and are recruiting

trained people to make sure that they catch

up with existing management standards

elsewhere. It is clear, however, that

India can produce world-class companies.

We are currently running two sites with

25,000-person workforces and that

is quite rare anywhere in the world,

Bowden says.

Conclusion

Indias generation and transmission

sectors are now open to private investment

and the nations leading companies have

rushed to fulfil the countrys burgeoning

demand for electricity. The country has

taken some time to develop a model of

private sector participation that works

and is respected by national and state

governments. The Indian experience for

international companies in the 1990s

and early 2000s has resulted in a muted

foreign response to the opportunities that

exist in the modern market.

The reforms of 2003 have gone a longway to fixing early problems and foreign

private firms should look anew at India.

The country still has some way to go

before it can hope to attract investment

in the regions of the country where it

is most needed; it is not uncommon for

Indian power executives to define the

Indian market as just four states, ignoring

the 22 which are deemed uncreditworthy.

Many states still need to fully implement

open access legislation and ensure that

state-owned distribution companies pay

generators according to the terms of their

agreements.

While we

started out as a

manufacturing

organisation, we

have now become

an innovation-driven

company. Last year

we spent almost

2.5 percent of our

turnover on R&D

and filed patents at

the rate of nearly

one a day.

B.P. Rao

Chairman &

Managing Director

of BHEL


9/10

F o c u s : N u c l e a r P o w e rP o w e r S u m m i t - T h e E n e r g y H a n d b o o k 2 0 1 1

36 37

In many countries, nuclear is the

only large-scale alternative to fossil

fuels that is readily available to meet

growing demand for baseload power.

Here we look at the opportunities and

challenges associated with nuclear power

and explore the major avenues of researchand development within the field.

The perfect answer for the reduction of

CO2 emissions, on a large scale, is nuclear

power plants, believes Bob Prantil,

North Region Executive at GE Energy. But

despite its emission credentials, nuclear

generation promotes an ideological

discussion perhaps more than any

other energy issue. Duncan Hawthorne,

President and CEO of Bruce Power, a

privately owned company that operates

a nuclear facility in Canada, believes that

this is due to the necessity of the reliable

power that nuclear power provides: Ive

always said: We are nuclear. No one

likes us. We dont care. The market place

is very obvious. The world cannot survive

without our contribution.

In 2009, 1314 percent of the worldselectricity was generated from nuclear

power. According to the European

Nuclear Society, in October 2010 there

were 441 nuclear plants in operation, in

30 countries, with a combined capacity

of around 375 GW. The World Energy

Council reports that this capacity is

expected to rise to between 600 and

1,340 GW by 2030. Over 30 countries

are currently planning or delivering nuclear

energy programmes. Across the world, 52

reactors are under construction, a further

140 are on order or planned, and an

additional 344 are at the proposal stage.

Nuclear Power

Nuclear power has never been so widely, and extensively,

employed as it is today. More and more of the world is

embracing nuclear generation on an unprecedented scale due toits near zero emission of greenhouse gas and relative insulation

from commodity price fluctuations and supply chain disruption.

Article by:

Tom Willatt

Q Please could you

start by giving us an

overview of Bharat Forge

and how the companyhas evolved since you

became CMD?

A In the 1990s, I

converted our company

to a global business and I

believe that we are now

the leading company in

our segment. We have

diversified from being purely a supplier to the

automotive industry into other industrial sectors

as well. Our strategy for this decade is to build

our non-automotive businesses -- primarily our

capital goods interests -- substantially, so that

they contribute to 70- 75% of our revenue. Five

years ago it was only about 5 or 10%. Within the

capital goods segment, power is one of the key

verticals.

We are a technology-driven company and within

the power sector we are going to be present in

the renewable energy as well as thermal and

nuclear energy sectors. Our focus is to build

equipment for these sectors. We are currently

building wind turbines which we manufacture and

sell in India and Europe. We are now setting up a

plant to build steam turbines and generators using

super critical technology. We are partnering with

Alstom in this.

We are also setting up a plant to build turbines

and generators for thermal power plants in the

range of 300 to 800MW sub critical, super

critical and ultra super critical. Bharat Forge

also has a relationship with Areva of France

to manufacture and supply components forthe nuclear power sector. We currently supply

specialised forgings to the Indian nuclear industry

and by the nature of our upcoming businesses

we will become a very large player in the power

sector.

Q You have built a dominant position in your

core business of components, why then enter

an industry (power equipment) that has been

under the control of a handful of state-owned

companies for many years?

A For many years there has only been one

player in the Indian power equipment sector and

Interview with Baba N Kalyani,

Chairman and Managing Director, Bharat Forge Ltd.

that is BHEL. Production capacity was about

5,000MW to 6,000MW, which they are currently

doubling. Indias current installed capacity is

about 150,000MW and this needs to go up tonearly 800,000MW in the next fifteen years. This

growth cannot be met by one company alone.

The power market is the biggest opportunity in

the Indian manufacturing sector today. Power

equipment by its nature requires a lot of forging -

- which is our core business. We are world leaders

in our field and experts at manufacturing.

Q How do you see the Nuclear Liabilities Act

impacting on your aspirations in the sector?

A I think that there is a lot of media hype

surrounding the issue. My own personal view is

that between the government of India and the

people who plan to build the nuclear plants, there

will be a very clear understanding of liabilities.

If you have a one-sided view of liability then no

one is going to build the plants. The market has

its own way of finding its balance. I dont think

there will be any delay caused by this. If you have

any liability you can go to an insurance company

and they can give you cover for a certain price.

This price will be the same for anyone. If it is

uninsurable then no one will build the plants.

Q What would be your message to our readers

around the globe about the Indian Power Sector,

and Bharat Forge specifically?

A Bharat Forge aims to grow by three times

within the next five years - and will be a $4bn

company. Power equipment sales will play

a substantial role in this growth. The power

industry in India; whether it be the manufacturing

of equipment, energy generation, transmission

or distribution; is going to be one of the largest

drivers of growth over the next two decades.In order to reach at least moderate levels of

electricity consumption in India, the sector will

require major investment. India is without a doubt

one of the most exciting places in the world when

it comes to doing business in the power sector.

Bharat Forge is committed to play a significant

role in manufacturing equipment and energy

production. India will emerge as one of the

most competitive places for manufacturing high

technology products within the next twenty

years. Brand India is already improving, but there

is still a long way to go.


10/10

F o c u s : N u c l e a r P o w e rP o w e r S u m m i t - T h e E n e r g y H a n d b o o k 2 0 1 1

38 39

Developing World Demand

Nuclear technology was born in the

laboratories of North America, western

Europe and the Soviet empire, and these

regions were the first to feed nuclear

power into their grids in the 1950s and

1960s.

In the 1970s and 1980s, however,

the western world was shaken by the

Three Mile Island and Chernobyl events.

The resulting regulatory changes led to

enormous project cost over-runs and

cancellations, and a 30-year lull in nuclear

power investment in this region.

Yet the nuclear industry did not stagnate.

The focus for development of nuclear

plants shifted to new adopters, keen to

diversify their power generation options.

Over the past 30 years the number of

countries employing nuclear power has

grown steadily.

Currently, nowhere is this more true than

in China. According to the World Nuclear

Association, China has the worlds

fastest-growing nuclear programme, with

a target for 2020 of 70 GW in operation

and a further 30 GW under construction.

In other countries, however Iran being

currently the most notorious example the

spread of nuclear power is constrained by

political concerns about the proliferation

of nuclear weapons.

Western Renaissance

Since 2001, industry observers have been

increasingly discussing the potential for a

nuclear renaissance across the developed

world. Bans on nuclear development have

been repealed in Sweden and Italy, andnuclear fleets are being refurbished or

expanded in South Africa, Japan, Ukraine,

the Czech Republic and the USA.

The trend is not universal Germany and

Spain are uncertain about their nuclear

future and are continuing to phase out

nuclear but overall the industry is

certainly gaining momentum.

One of the big concerns for policy-makers

is the lingering risk of large cost over-runs

on nuclear construction projects, with

billions of dollars at risk.

Finlands Olkiluoto 3 development, for

example, has been plagued by delays,

over-runs and safety concerns. Nuclear

is ideal for the baseload, because once

it is up and running the operating cost

is very low, says Tony Masella, Partner

and MD for the Resources Practice at

consultancy Accenture. However, there

is a lot of debate about whether the costof a new build or refurbishment is a good

use of public funds.

The length of time since the last Western

nuclear plants were constructed means

that the necessary experience may be

lacking.

The issue that we face in North America

is that we havent built one in thirty

years, which causes great uncertainty

in terms of cost, says Pierre Gauthier,

President, Alstom Canada and USA. It

is hard to evaluate today what will be the

end cost of a nuclear power plant in North

America.

Decision-making is made more difficult

by the fact that the cost of natural gas,

although often volatile, is currently low

and looks to stay that way.

While shale gas is being found everywhere

in huge pockets and being traded at around

$5 a ton the value proposition of nuclear

becomes an even greater challenge, says

Tony Masella of Accenture. Compared to

nuclear, gas-fired power plants are also

quick to build.

International cooperation

Whether or not nuclear power does see

a western renaissance, the established

nuclear suppliers in these countries seethe global spread of nuclear power as a

great opportunity.

The extension of nuclear power to new

countries is underpinned by international

cooperation. Companies from nations

with expertise are working with aspirants

to provide the technical assistance they

need to take their nuclear programmes

forward.

Nuclear power was traditionally a very

nationalistic industry, but todays

nuclear companies are now becoming

increasingly globalised. Jean-Franois

Bland, Executive Vice President at Areva

Canada, says: Its a global industry now;

national players no longer exist. Areva

is no longer a French player. We have

employees around the world. It is that

paradigm shift that Canadian companies

are going through now. It is a worldwide

market and it is focused on what is themost reliable and economically viable

technology for the taxpayer.

Given that carbon neutrality is one of

nuclear powers greatest strengths, the

introduction of a globally acknowledged

carbon price would greatly add to the

ability of nuclear energy to compete with

fossil-fuel generation.

The lack of regulatory certainty regarding

carbon pricing is constraining large capital

investment, explains Keith Triginer,

Country Executive, GE Energy Canada.

Unfortunately, large nuclear plants fall

into that bracket. If and when carbon

pricing gets established, I think that willaccelerate large capital investment in

nuclear around the world.

Next-generation Technology

Nuclear power is generally considered in

terms of four generations of technology

over its five decades. The first generation,

developed in the 1960s and 1970s, is

now rarely operated. Second-generation

reactors were mostly developed in

North America and Europe, and remain

in operation across the world. The third

and fourth generations, now under

development, should make nuclear

power more efficient, safer and easier to

construct.

Though current reactor sizes are typically

around 1 GW, there is a movement

towards smaller, modular reactors to

replace small coal-powered plants.

Michael Lees, President, Babcock & Wilcox

(B&W) Canada Ltd., explains: We are

developing the B&W mPower advanced

light water nuclear reactor that can

range in the 150300 MW size. The cost

saving from a large nuclear plant is quite

dramatic, as you move construction and

manufacturing into a shop environment

to create complete, road transportable,

units.

This strategy reduces

construction risk

significantly, not least by

allowing utility companies

to replace a single large

facility with a number of

smaller modules. We hope

to have sales in the US

within the next decade,says Michael Lees.

Given the increased risk

associated with being

an early adopter of new

technology, some people

think that the renaissance

will only really gain speed

once the next generation

of reactors is already

up and running. I see

an increasing role for nuclear its a

necessity, not a choice, because of

its reliability, believes Kurt Strobele,

Chairman and CEO of Hatch, a global

engineering firm that is active across the

power industry.

But it will be a small start. There is a lot

of inertia, and the new projects and new

technologies have not been as successful

as hoped. Once we get past that first

hurdle I think there will be a very fast

climb in nuclear build.

Questions to be Answered

Nuclear energy is clearly going to play

an increasingly important role in global

electricity generation. The world is driving

towards a lower-carbon economy and

nations are looking for reliable baseload

energy to complement renewable

sources.

The nuclear industry needs not only to

convince the public of its green credentials

but also to show decision-makers that

the economics of nuclear energy can

compete with the other baseload options

available.

To allay the fears of policy-makers, nuclear

technology companies will need to show

that they can build the next generation of

reactors repeatably, efficiently and cost-

effectively. If this can be accomplished,

the long-heralded nuclear renaissance

seems likelier that ever.

I see an increasing

role for nuclear

its a necessity, not

a choice, because

of its reliability.

Kurt StrobeleChairman and CEOof Hatch

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