Page 44 - Index

Propelled by a growing population, rapid urbanisation, and industrialisation, Government’s efforts towards achieving energy access, the demand for electricity is likely to see accelerated growth in the coming years. Further, demand for electricity is also envisaged to increase due to Govt. of India’s thrust on increasing the share of electricity in total energy consumption and efforts towards improving financial and operational performance of the distribution sector.
Power Transmission Sector in India
The transmission sector plays a vital role in the power system value chain linking supply i.e. generation facilities with demand centres and a resilient grid is critical for increasing RE penetration into the grid, and for enabling an unconstrained power market. In India, the transmission system is a two-tier structure comprising intra-state transmission systems (InSTS) and inter-state transmission system (ISTS), with Power Grid Corporation of India Limited, the Trust’s Sponsor, being the largest power transmission company in India.
Power Transmission infrastructure in the country has registered strong growth over the past decade, largely driven by growing demand for electricity, capacity additions and enhancing interregional connectivity. During the period FY 2012 to FY 2022, total Transmission Line (220 kV & above) has grown from 257 thousand ckm to 457 thousand ckm and Transformation Capacity (220 kV & above) has grown from 410 GVA to 1,104 GVA. This has led to increase in Inter-Regional Power Transfer Capacity (MW) from 27,150 MW to 1,12,250 MW and increase in total Inter-Regional Power Transfer (BU) from 59 BU to 228 BU during the same period.
The transmission system expansion has led to the creation of a synchronous National Grid, achievement of ‘One Nation-One Grid-One Frequency’, and has enabled a vibrant power market in the country.
Rising power demand coupled with Government’s focus on addition of RE capacity; increasing cross-border linkages; adoption of new technologies like Battery Storage Systems, Pumped Storage to address RE linked challenges; Govt. schemes to improve distribution sector are driving the growth of power transmission in India.
Govt. of India has recently introduced reforms in power transmission sector aimed at creating a robust transmission infrastructure while also attracting investments in the sector. In this direction, to overhaul the transmission system planning, the recently promulgated new rules, the General Network Access, are directed towards giving power utilities easier access to the transmission network. The rules also require Govt. agencies to prepare an implementation plan for the ISTS every year on a rolling basis, giving visibility to transmission system development. Further, the new standard bidding document finalised by the Govt. of India for competitively bid out transmission projects has reduced the lock-in period for transmission projects, increasing opportunities for faster recycling of capital.
National Infrastructure Pipeline (NIP) and National Monetisation Pipeline (NMP)
The ` 111 trillion National Infrastructure Pipeline for FY 2020-25 is a one-of-its-kind government initiative to attract investments and provide world-class infrastructure to citizens. The power sector together with renewable accounts for a share of more than 20% of the NIP, and this will provide further impetus to power transmission infrastructure. Further, the NIP envisages a capital investment of ` 3 trillion in power transmission during FY 2020-25 which includes ` 1.9 trillion by the States.
NIP’s Vision 2025 for Power
24/7 clean and affordable power for all Total capacity of 583 GW (Renewable 39%)
Reduction in share of Thermal; Increase in Renewable Energy
Renewable share in consumption to increase to ~20% per capita consumption 1,616 units
Promotion of grid storage and offshore wind energy Reforms in distribution
Electric vehicle charging infrastructure
Source: NIP
The Rolling Plan (2026-27) for ISTS, March 2022, prepared by the CTUIL, estimates significant investments in ISTS between FY2022 and FY2027.
The National Monetisation Pipeline (NMP) formulated by the Government is a crucial initiative targeted at kickstarting investment cycle which will be crucial in funding the infrastructure projects. It envisages monetisation of brownfield revenue earning operational infrastructure assets worth ` 6 trillion over a four-year period from FY 2020-25, running co-terminus with the NIP. Assets worth ` 852 billion have been earmarked for monetisation in the power sector, of which ` 452 billion i.e. more than 50% is envisaged for power transmission through POWERGRID. The NMP lays emphasis on InvITs as one of the modes for asset monetisation of power transmission assets. The government has also introduced several favourable regulatory and taxation norms aimed at making InvITs an attractive investment vehicle in India for global investors.
(Source: National Monetisation Pipeline)
Business Overview
POWERGRID Infrastructure Investment Trust (PGInvIT) is set up by Power Grid Corporation of India Limited (POWERGRID), a Maharatna Central Public Sector Enterprise (CPSE) and India’s largest transmission player, to own, construct, operate, maintain, and invest, as an infrastructure investment trust, in power and power transmission assets in India. It is the first InvIT sponsored by any Government entity in our country
42 Annual Report 2021-22