ADR MOTORS PVT. LTD.

Presented by:

Achala Simha (PGDM 12183)

Dhrubajyoti Sahu (PGDM 12136)

Rheetam Mitra (PGDM 12156)

Scenario“You work as a GM in a car manufacturing company. Recently, due to a major grid collapse, your production came to a standstill across several units in northern India. This is affecting your work. You wish to set up an alternate power-generating unit and wish to harness wind/hydel energy. Present your plan to your board."

Who we are?o One of the leading car manufacturers in India for past 2

decades

o Head-quartered in New Delhi

o Chief commercial vehicles in the domestic market are :• Zinga (1tonne)• Suave (2tonnes)

o Global brands are :• Postos (1tonne)• Nortol (2tonnes)

o Profit making company• Total Sales growth by 15% (~8 lakh units) - YoY• Net revenue growth by 25% (~80,000 Cr) - YoY• Profit growth by 70% (~7000Cr) - YoY

Our Presence

OverseasParisLuxembourgSydney

North India

Nalagarh (HP)Gurgaon (Hariyana)Faridabad (Hariyana)

South IndiaChennai (Tamil Nadu)Hosur (Tamil Nadu)Trichy (Kerala)

Recent Concerns

• Heavily dependent on PGCIL

• Heavy losses due to frequent black outs in plants situated in Northern India

• Total losses amounting to Rs. 565crores

Mar

'12

Apr'12

May

'12

Jun'1

2

Jul'1

2

Aug'12

0

50

100

150

200

250

300

350

400

450

5 10 8 6

80

4

2550 40 30

400

20

Losses due to blackout

Hrs of blackoutLosses(in crores)

Current power consumption and expenses

• Average daily total power consumption per manufacturing plant = 35 MW (Inclusive of assembly line and auxiliary consumption)

• Daily cost for 3 plants in North India (20hrs/day) =1.4 Cr

What is Wind Energy?• Non conventional source of energy as against thermal or hydel

energy• It mainly consists of wind turbines• Essentially a converted form of solar power• Converts the kinetic energy present in the wind into more useful form

of energy such as mechanical energy and finally electricity• Reduction of dependence on the traditional form of electricity through

power grids

Advantages of Wind Energy• The capital cost is slightly higher than fossil fuel power

plants but much lower than a solar power plant• Usually it ranges between 400 crores to 800 crores for a

100MW• The Running Cost of a Wind Farm is very low as the fuel

cost is zero and operations and maintenance costs are low too

• It will be used for captive power generation• Heavy tax benefits in India• Construction in minimum time (8-10 months) and a short

payback time of another 3-8 months

Feasibility study for Wind Farm

Place (in Rajasthan)Annual average air

density (kg/m3)Annual average wind

speed (m/s)

Devgarh 1.11 5.52

Phalodi 1.14 6.3

Jaisalmer 1.14 6.5

Feasibility study for Wind Farm (Continued..)

• Jaisalmer could be the most suitable of all the three places

• There’s ample space to setup a 500 acre wind farm

Average distance measurement for transmission lines

• Jaisalmer to Gurgaon - 750 km.• Gurgaon to Nalagarh - 331 km.• Gurgaon to Faridabad - 60 km.

A total of 1141 Km.

Rating of Suppliers

Turbine manufacturer

Suzlon Energy Ltd.

Vestas Wind Technologies India Pvt. Ltd.

Alstom India Ltd.

Model Name S80-1500 V82-1650 ECO-1800

Capacity(KW) 1500 1650 1800

Score 10.2 10.13 10.55

Detailed Project Costs

S. No. DescriptionRate/unit

(Rs. Lakh)Qty. or no. of

unitsAmount (Rs.

Lakh)

1.

Purchase of land, land

development and fencing

charges

Lump sum amount

500 - 520 acres(80*6.5 acres) 210

2.Supply of WEG

of 1.8MW capacity each

500.00 80 40000

3.

Packaging , handling, loading ,

transportation, unloading and

insurance cover till erection of

WEGs

10.00 80 800

Detailed Project Costs (continued..)

S. No. DescriptionRate/unit

(Rs. Lakh)Qty. or no. of

unitsAmount (Rs.

Lakh)

4.Foundation and

other civil structures

3.0 80 240

5.Electrical and Transformers

110 KV10.0 80 800

6. Erection and Commissioning 8.0 80 640

7.

Other project cost including charges for

infrastructure development @ Rs. 40.00 Lakh per MW for 110

MW

40.00 1 40

Detailed Project Costs (continued..)

S. No. DescriptionRate/unit (Rs.Lakh)

Qty. or no. of units

Amount (Rs. Lakhs)

8.Cost of 110

KV OHT Line 10.0/KM 1141 KM 11410

Total 54140

Feasibility Study for Hydel Energy

Hydro Electric Power Plant

1. Bhakra Dam, Punjab

2. Nathpa Jhakri Dam, H.P.

Advantages of Hydel Energy• It is a renewable source of energy and non-polluting in nature• Fuel cost of HEP plant is inflation-free and reduces with time, thereby brings down the

overall per unit cost• HEP plants have a long useful life, extending to 50-100 years• HEP plants are usually set in remote/backward areas, thereby lead to economic

development• Storage type HEP plants can be used for multiple purposes like flood control, irrigation

etc.

Project Cost EstimatesParameters Rs. Cr.

Per MW Cost 5.5

Total Project Cost 605

Completion Time Period (Months) 61

Interest During Construction 112

Cost of Transmission Network Setup 100

Total Cost 822.5 (Apprx.)*

*Hydro Power Vs Thermal Power: A Comparative Cost-Benefit Analysis Adesh Sharma, AIPL (Power Sector), India

* Keeping the PLF at 45%

Comparison

Wind Energy

• Life expectancy is nearly 20 years• Cost is around 550-600 crores• Highly subsidized by the Govt.• Almost ‘zero’ operational costs• Best as an immediate alternative

Hydel Energy

• Life expectancy is 50-100 years• Cost is around 800-850 crores• Marginal benefit (output) is higher• HEP plant is considered as the

best choice for serving peak load• Cost of generation is cheaper than

even Thermal Power Plants• Suited for any future expansions• Best as a long-term solution

!