Sigma Insights – Open Access and Pricing of Power

1. Sigma Insights – Open Access and Pricing of Power

2. Review of Open Access across States

3. = High; = Low = Medium; states are not open in providing Open Access – Degree of OA varies significantly across states…

4. Open Access – Tariffs and Charges in Various States

5. Additionally states impose a variety of tariff and non-tariff impediments in grant of OA…

6. Additionally states impose a variety of tariff and non-tariff impediments in grant of OA…

7. Options for sourcing Open Access Power – Indicative analysis for Gujarat

8. A review of tariff profiles of different consumer categories highlights various distortions… 2.7% 5.3% 3.5% 5.6% 7.5% 12% 7.8% 2.9% 18% Data Source : ARR from DISCOM • Agricultural tariffs continue to be low. • However tariff distortions in Gujarat lower then what is seen in other states. Materially tariffs for domestic, Non-domestic and Public Lamps should increase significantly from here – since they contribute largely to peak power requirements

9. An interesting comparison of cost break up… Cost Break up of a Guj Utility Industry Tariff Break up India and Europe Comparison 4.80 7.47 7.47 5.90 • Our system cost is high. • There are multiple explicit and implicit cost loadings in industrial tariffs in India.

10. Multiple options are available to source power under OA – However most of the power is currently being sourced through Exchange… 7.42 6.34 5.92 • Exchange has been a low commitment option till date • On top of that, power prices on exchange in the last two years have been low • However, it has been impacting states systems in multiple ways and states have now started imposing restriction on such free flow of power

11. Cost of power generation has been increasing in the recent past…

12. Other options are also available for sourcing power…

13. An indicative Comparison of charges under different options of sourcing power is provided below at 66 KV… 7.69 7.4 6.4 6.0 6.14 5.9

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