Recently, P. Uma Shankar the Secretary of Power Ministry India said at GridWeek 2011, "Smart Grid is not a luxury, but a necessity for India." Which is indeed true for developing countries like India, where more than 400 million people do not have access to electricity, and so, even miniscule efficiency can make a difference in having electricity or not. ZPRYME, the leading research and consultancy services organization, in its latest report predicts that Indian Smart Grid market will touch $1.9 billions by 2015. The Indian government has embarked on $900 billion investment in Electrical Infrastructure by 2020 that includes building new transmission and distribution lines, and power generation plants. The research further mentioned that the basic electric infrastructure market will reach to $5.9 billion in the year of 2015. At present, Smart Grid market in India is $1.1 billion and 16.3% CAGR growth is forecasted between 2011 and 2015.
The communication and wireless segment, which in 2011 constitutes $137 millions, is set to grow fastest cloaking on average 24.9% CAGR between 2011 and 2015. The Smart metering will grow from $286.6 to $445.5 millions, Sensors from $137 to $236 millions, software & hardware from $247 to $339 millions, and Smart T&D equipment from $234 to $392 millions during the same period.
According to P. Uma Shankar, Indian Smart Grid will have following 6 guiding principles.
1) Smart Grid will be based on Indian model and will be indigenous
2) Focused towards Power Shortages
3) Prevent theft and other losses
4) Provides power in rural areas
5) Development of alternative power sources
6) Affordable and enables sustainable production of power
Although, the Smart Grid in India has huge growth potential, there are numerous challenges confronting the modernization of Grid. The Peak demand is outstripping the supply by 7 to 11%; ZPRYME predicts demand to grow 6.0% annually from 885 billion kwh to 1147 billion kwh between 2010 to 2015. Sanjay Seth, Country Manager, Itron India notes, " Currently there are pockets in India that have surplus power, but are unable to sell to deficient regions creating an artificial shortage scenario, Smart Grid technologies can enable utilities demand response mechanism that can curtail power during shortages and avoid blackouts." Apart from shortages, if theft is included, T&D losses amount close to 50%; the coal power plants, which together with gas supplies 65% of the total energy needs, lags at 27% efficiency compare to western level of 37% efficiency. Electric Infrastructure is not consistent across the nation, and due to local factors, electrical monitoring is imprecise, furthermore, 50 % of the rural area is lacking electricity. All this results into frequent power outages, heavy losses, and unreliability of grid. Such challenges also provide an opportunity for unique and innovative solution and as India is yet to build large part of the grid, it will have an opportunity to design and build Smart Grid from scratch, notes Vimal Mahendru, President IEEMA.
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