Heena Duggal Subhojit Das Varsha Chandra Rohit Srivastava Mukesh Mishra

Yatish Mittal Vikrant Arora Arun Joshi Sudhir Kumar Amit Yadav Rajnish Kumar

ENERGY
Energy is the capacity of a physical system to perform work. Energy exists in several forms such as heat, kinetic or mechanical energy, light, potential energy, electrical, or other forms.

TYPES OF ENERGY
Renewable Energy -Energy coming from Natural
Sources, which are not diminished by the usage of this energy. EX- Sun, Water, Wind, etc.

Non-Renewable Energy - An energy resource that is not

replaced or is replaced only very slowly by natural processes and are thus considered "used up", not available to us again. EX- Nuclear energy, Fossil fuels, coal, etc.

ENERGY IN INDIA
With 15% of the worlds population and an economic growth rate that increases the aspiration of its people to better quality of life, India has a voracious appetite for energy. But the country lacks sufficient domestic energy resources, particularly of petroleum and natural gas, and must import much of its growing requirements. Currently, about 35% of Indias commercial energy needs are imported

ENERGY SUBSIDIES
Energy subsidies are measures that keep prices for consumers below market levels or for producers above market levels, or reduce costs for consumers and producers. Energy subsidies may be direct cash transfers to producers, consumers or related bodies, as well as indirect support mechanisms, as tax exemptions and rebates, price controls, trade restrictions, planning consent and limits on market access.

PLAYERS IN POWER SECTOR IN INDIA

National Thermal Power Corporation (NTPC) Damodar Valley Corporation (DVC) National Hydroelectric Power Corporation (NHPC) Nuclear Power Corporation of India (NPCI) Power Grid Corporation of India Ltd. (POWERGRID)

17th Electric Power Survey of India

As per released by Central Electricity Authority on 24th May, 2007 . The total installed Capacity (as on 30-06-2011) is 1,76,990.40 MW

YEAR
20 1 1 - 1 2
2016-17 2021-22

Electrical Energy Requirement at Power Station Bus Bars ( GWh)

Annual Peak Electric Load at Power Station Bus Bars ( MW)

968659
1392066 1914508

152746
218209 298253

ENERGY SUBSIDIES - WHY

Security To Supply Environmental Improvement Economic Benefit

Employment & Social Benefit

ENERGY SUBSIDIES - HOW

The overall cost of the programme The transaction and administration costs it involves The cost of the subsidy affects different social groups

TYPES OF ENERGY SUBSIDIES

Failure to impose external costs Environmental externality costs; Energy security risks and price volatility costs. Depletion Allowance - allows a deduction from gross income of up to 27% for the depletion of exhaustible resources (oil,gas,minerals).

CONTI
Direct financial transfers - grants to producers; grants to consumers; low-interest or preferential loans to producers. Preferential tax treatments - rebates or exemption on royalties, duties, producer levies and tariffs; tax credit; accelerated depreciation allowances on energy supply equipment.

CONTI
Trade restrictions - Quota, Technical restrictions and Trade embargoes. Energy Related services provided by government at less than full cost - Direct investment in energy infrastructure; Public research and development. Regulation of the energy sector - Demand guarantees and mandated deployment rates; price controls; Market-access restrictions; preferential planning consent and controls over access to resources.

EFFECT OF ENERGY SUBSIDIES

Economic Effect Environmental Effect
Social Effect

ALLOCATION OF SUBSIDIES IN US
The three largest fossil fuel subsidies were: Foreign tax credit ($15.3 billion) Credit for production of non-conventional fuels ($14.1 billion) Oil and Gas exploration and development expensing ($7.1 billion) The three largest renewable fuel subsidies were: Alcohol Credit for Fuel Excise Tax ($11.6 billion) Renewable Electricity Production Credit ($5.2 billion) Corn-Based Ethanol ($5.0 billion)

IMPACT OF ENERGY SUBSIDIES ECONOMIC IMPACT

Impact on Inflation Energy subsidies lead to a worsened fiscal balance Impact on Industrial Output Impact on Household Sector Effect of Subsidy removal on world prices Encourage adding value to local resource

Social Impact of energy subsidy

If subsidized
1.New technique for agriculture 2.Industrialisation

If not subsidized
1.No electricity. 2.No industries

Electrification

Living standard Increased contribution of rural sector in GDP

1.Raising living standard by better basic amenities and better facilities

1.High yield 2.Increased productivity 1.Encourages privatization

1.High transportation cost. 2.No Education

1.Poor yield and low productivity results in lesser GDP 1.Continuation of public sector reluctancy to work

Privatization
Purchasing power of rural people

1.Encourages saving. 2.Employment

1.Unemployment 2.Low or no wages and income

ENVIRONMENTAL IMPACT OF ENERGY SUBSIDY

Air pollution Water pollution Global effect Safety concern Land Degradation Depletion of natural resources Discourages deforestation

USEFULNESS OF ENERGY SUBSIDIES

Economic Activities Human Development or Well-Being To Curb Inflation

Contd..
Advantage To Government
Development of Industrial and Agriculture Sector Reduce Dependency on Imports

CROSS SUBSIDIES
ILLUSTRATION

Commercial Industrial, KEPCO Customers Agricultural

1=1.34

1= -0.96 1= -0.48

Energy Subsidies are Wasteful

1)- Irresponsible usage of energy- cheap in Cost which leads to over consumption EFFECTS Depletion of fossil fuels impacts on the environment global warming.

2)- Nuclear Power

Major recipient of Energy Subsidies. Uneconomical energy source.

3)-Deficit to government
4)-leads the excess usage of non-renewable energy

5)-Less R&D in Renewable source of energy

Hydropower energy

Wind Energy

biomass energy

Geothermal energy.

usage of solar energy

6)-Less Concentration on other sectors like

Education Infrastructure Medical

In law malpractice is a type of negligence in which the professional under a duty of act fails to follow generally accepted professional standards, and that is breach of duty is the proximate cause of injury to a paintiff who suffers harm.

MALPRACTICE

Effected body
Producer Provider consumer

TYPES OF MALPRACTICES
Misquoting of rates Misappropriation of material drawn from stores wrong measurements wrong certifications

Example
Electricity board suspends 11 officials over charges of malpractice "The committee found that there existed a nexus between officials of the Nigam and contractors, which resulted in misquoting of rates and caused financial losses, misappropriation of material drawn from stores, wrong measurements, wrong certifications and undue directions to release the withheld payments," added the official.

RENEWABLE ENERGY SUBSIDIES

Renewable energy is energy which comes
from natural resources such as Sunlight, wind rain tides and geothermal heat, which are renewable. About 16% of global final energy coming from traditional biomass, which is mainly used for heating and 3.4% from hydroectricity. TYPES Wind power Hydropower Solar energy Biomass Biofule Geothermal energy

ADVANTAGES
Non-polluting Stimulating the economy and creating job opportunities Trade deficit is being improved Tax incentives Sustainable and never run out Require less maintenance Waste products Economic benefits

DISADVANTAGES
Quantities of electricity Reliability

RENEWABLE PROJECTS
500 kw grid power project in IIT kanpur TATA wind power project TATA solar project

CHALLENGES
Inadequate power generation capacity. Shortage of coal supply in generation of electricity. Bad performance of electricity distribution in the reign of major political parties. Lack of optimum utilization of the existing generation capacity. Inadequate inter-regional transmission links. Inadequate and ageing sub-transmission & distribution. Network leading to power cuts and local failures/faults.

CHALLENGES
Large scale theft and skewed tariff structure. Slow pace of rural electrification. Inefficient use of electricity by the end consumer. Electricity is running in losses. Lack of grid discipline. Shortage of equipment which reduces capacity addition targets. Incomplete target.

REFORMS
Distribution Sector Reforms : Private Sector Reforms were first initiated in India in 1992 by the ministry of power. Private investment failed to yield much benefit. It involves system up gradation.

 APDRP (Accelerated Power Development & Reforms Programme) was launched by ministry of power during the 10th five year plan. (2002-07). To improve the power supply reliability at distribution level and To achieve commercial viability of the state electricity Departments. 20,000 crores for investment and 20,000 crores for incentive component were planned.

 The scheme has two components :1. Investment Component : GOI provides

additional central assistance for strengthing and up gradation of sub-transmission and distribution network.

2. Incentive Component : An incentive equivalent to 50% of the actual cash loss reduction by SEBs/ Utilities, is provided as grant.
Funds Released

R-APDRP
RESTRUCTURED ACCELERATED POWER DEVELOPMENT & REFORMS PROGRAMME

R-APDRP is government of India initiative. PFC is the Nodal Agency to operationalise the programme under the guidance of Ministry of Power (MOP), Government of India (GOI).

DEVELOPMENT OF DISTRICT LEVEL DISTRIBUTION IMPROVEMENT PLANS/PROJECTS FOR ALL DISTRICTS

Setting up of district level Energy Committees .
Development of 60 Distribution Circles. Hundred percent metering and effective Management Information System (MIS). Signing of MOUs with States for undertaking

distribution reforms.
Tariff rationalization by SERCs.

REFORMS
Electrification of Villages and Households Providing affordable power Sustainable power development Upgrading technical efficiency and skill levels.

CONCLUSION
Potential importance , positive plus negative impact. Need for research & focus on public. Emphasizing on environmental friendly subsidies. Creating a panel of experts to monitor. A clear public consensus.