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PRESENTATION ON

Performance of

BSES Yamuna BSES Rajdhani

25th August, 2003

BSES RAJDHANI POWER LTD.

BSES YAMUNA POWER LTD.

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• Power sector reforms

• Accelerated power development reforms programme

• Business plan

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Delhi Power Sector Reforms

The Delhi Power Sector Reforms model achieves

a fine balance between the interests of all the

stakeholders – Consumers, Investors, Lenders,

Employees, Government and Regulator.

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March, 1999March, 1999

Reform chronology

Strategy Paper on Reforms

Establishment of Delhi Electricity Regulatory Commission (DERC)

Appointment of SBI Capital Markets Limited (SBI Caps) as financial advisor for the privatization process.

Signing of agreements between GoNCTD and the Workers Union and Junior Engineers (thus ensuring that the process did not have any resistance from within)

Promulgation of Delhi Electricity Reform Ordinance and its ratification by Delhi Legislative assembly

Submission of inception report by SBI Caps based on which GoNCTD took a decision to restructure DVB and privatize the distribution function

Dec, 1999Dec, 1999

Feb, 1999Feb, 1999

Oct – Nov,

2000

Oct – Nov,

2000

October,

2000

October,

2000

Jan, 2001Jan, 2001

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March, 2001March, 2001

Reform chronology

RFQ issued

Enactment of Delhi Electricity Reform Act

Short-listing of bidders at RFQ stage

Issue of RFP

Submission of Bids

Award Letter of Selection by GoNCTD

October,

2001

October,

2001

Feb 2001Feb 2001

April - May, 2002

April - May, 2002

Nov, 2001

Nov, 2001

May, 2002May, 2002

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1st July 20021st July 2002

Reform chronology

RFQ issued

Implementation of Transfer Scheme & Take Over Implementation of Transfer Scheme & Take Over

May, 2002May, 2002

DERC was constituted on 03/03/99

•Last Petition filed 06/03/03•Last Tariff Order issued 26/06/03

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How the structure looks like

Structure made operational w.e.f. July 1, 2002

Holding Company

GENCOIndraprastha

Power Generation Company Ltd.

TRANSCODelhi Power

Supply Company

DISCOM-ICentral-East Delhi

Electricity Distribution

Company Ltd.

DISCOM-IISouth-West Delhi

Electricity Distribution

Company Ltd

DISCOM-IIINorth North -West Delhi Electricity

Distribution Company Ltd

GoNCTD

DVB AssetsLiabilities & Equity

1. All the assets and liabilities of DVB are acquired by GoNCTD

2. All the liabilities of DVB are transferred to Holding Company, entire Equity of Holding Company is issued to GoNCTD

3. All the assets are transferred from GoNCTD to successor entities. Assets assigned a value equal to serviceable liabilities

4. Equity and Debt in the successor entities, equal to the value of Serviceable liabilities is issued in favor of the Holding Company.

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Transaction Structure

HOLDING CO.

GENCO DISCOM-I DISCOM-II DISCOM-III

GoNCTD

100% 100%

49% 49% 49%

PRIVATE COS.Equity sale

(51%)

51% 51% 51%

TRANSCO

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Policy Directives

Define the process of privatization

Prescribe the bidding criteria - AT&C loss reduction

Retail tariffs to be same for DISCOMs for five years (upto 2006-

07)

Assured 16% post tax ROE on paid up capital & reserves

Differential Bulk Supply tariff (BST) to be the balancing factor

Transition financing by GoNCTD of Rs. 3450 crores to

TRANSCO

Incentive sharing @ 50:50 between Discoms and consumers for

exceeding the Govt. stipulated AT&C loss levels

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Policy Directives - Salient Features

Bulk Supply Tariff (BST) BST to be the balancing factor to ensure DISCOMs become

viable from day one

BST based on the paying capacity of the Discoms

For calculating BST, Commission shall

determine annual revenue of DISCOMs taking the quoted loss reduction figures into account

allow all prudent operating & capital expenses

ensure and allow 16% return on networth

Balance revenue would determine Bulk Supply Tariff

Govt. to make up for the loss suffered by TRANSCO

(actual cost of purchase – revenues from DISCOMs)

Consumer Friendly BST - obviates tariff shocks

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Contractual Structure

Shareholders agreement

Bulk Supply Agreement / Escrow agreement

Holding Co

DISCOM - II DISCOM - IIIDISCOM - I

DERC

TRANSCO GENCOPPA

Private co.

License

License

49% holding

51% holding

Loan Agreement

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Loss Targets – Bid

GoNCTD stipulated minimum loss reduction figures for each year

Bidders to quote over and above the minimum targets

Final bid AT&C levels accepted by Govt. :

BYPL Year 1 Year 2 Year 3 Year 4 Year 5 Total

Loss reduction level quoted by BSES

0.75% 1.75% 4.00% 5.65% 5.10% 17.25

Minimum loss reduction figures stipulated by Govt.

1.5% 5% 5% 5% 4.25% 20.75%

BRPL

Loss reduction level quoted by BSES

0.55% 1.55% 3.30% 6.00% 5.60% 17.00%

Minimum loss reduction figures stipulated by Govt.

1.25% 5% 4.5% 4.5% 4% 19.25%

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Loss Targets – Achieved

DERC determined opening loss levels for the year 2002-03. Actual opening loss levels (at the time of takeover in July, 2002) and the AT&C loss levels achieved as on March 31, 2003 are given below:

Particulars BRPL BYPL

As determined by DERC 48.1% 57.2%

Actual figures at the time of takeover 51.54% 63.16%

Target for 2002-03 0.55% 0.75%

Actual Reduction 4.14% 1.27%

Actual opening level for 2003-04 47.4% 61.89%

Opening level for 2003-04 as per bid 47.5% 56.45%

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Power Sector Reforms

100% Metering

11 KV Feeders

BRPLBRPL BYPLBYPL

Total Total NumbersNumbers

679679 515515

Total meteredTotal metered 609609 495495

Target for Target for balancebalance

Nov,03Nov,03 Nov ,03Nov ,03

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Consumer Indexing is in progress

In Progress

Distribution Transformers will be

metered

All Grid meters and 11 KV feeders are to be metered

Energy Accounting

Phase I

Phase II

Execution of above

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LLEnergy Accounting - 1

In Phase 1, all grid input points at 33/66 kV, inter-company transfer points and 11 KV feeders to be metered. Order placed for class 0.2 electronic meters with 15’ integration period. Installation to start from last week of August 03. All existing meters will be replaced.

In phase 2, all Distribution Transformers will be metered.

Consumer Indexing completed in 18 districts out of 21.

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Energy Accounting - 2

Energy Accounting to start after connection of feeder meters.

In Phase 1, it will be w.r.t. energy recorded by feeders

In Phase 2, after connection of DT meters, energy accounting w.r.t. DT meters

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APDRP

MOA signed

Committed to implement distribution reforms

Providing Reliable and Quality Power

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625.36

75

0

239

400

300

500

0 100 200 300 400 500 600 700

Sanctioned (includingconsultancy fee)

Released by GOI

RCVD By BSES

Utilized till June 03

NIT Issued

Orders Placed

Utilisation Target Upto Mar04

Crores

APDRP FUNDS

APDRP

APDRP ACCOUNT OPENED - - - - NOAPDRP ACCOUNT OPENED - - - - NO

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Performance BYPL

July 01 – June 02 July 02 – March 03

Input Energy (MU) 4724.35 3625.10

Metered Energy (MU) 1995.3 1734.20

Billed Energy (MU) 1995.3 1734.20

T&D Losses (%) 57.8 52.2

Realized Energy (MU)

1740.57 1381.5

Revenue realized (Cr.)

724.89 553.2

AT & C Losses (%) 63.2 61.9

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Performance BRPL

July 01 – June 02 July 02 – March 03

Input Energy (MU) 7380 5568.20

Metered Energy (MU) 3742 3315.19

Billed Energy (MU) 3742 3315.19

T&D Losses (%) 49.3 40.5

Realized Energy (MU)

3576.3 2928.7

Revenue Realised (Cr.)

1448.9 1145.03

AT & C Losses (%) 51.5 47.4

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Initiatives

To reduce T&D losses

Meet anticipated demand increase

To improve billing & collection efficiency

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Immediate Issues upon Takeover & Initiatives Undertaken – Short TermImmediate Issues

Unprecedented High Demand,Constrained Supply,Gaps in Organisation, Contractors Problems, Huge expectation as a run up to privatization etc.

Initiatives Undertaken – Short Term

Strengthening & streamlining of the organisation structure – CSO created

Consumer Grievance Cell created at Corporate Office

Call Centres’ capacity augmented & operations streamlined

Communication meetings with employees at various level

Resolution of Contractors’ Disputes, etc

Putting System Control Group in place

Payments timings at cash collection counters were increased on working days and counters were also kept open on weekends

Point of Sale machines (POS) were installed at the cash counters with bar-code scanners

Collection system beefed up - Additional Drop Boxes Installed

O & M support - additional FLC vans, outsourcing to UPL & other contractors

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Long Term Initiatives – Reliability Improvement

O & M

Preventive maintenance scheduling in all 104 EHV grid-substations

completed and corrective actions taken.

Preventive maintenance initiated at 11 KV & distribution level also.

Thermographic survey of 39 EHV grid substations completed and

corrective action taken.

Contract awarded to Alstom for attending preventive maintenance and

emergency breakdowns of EHV Grid sub-stations.

Over 1200 Nos. of burnt distribution transformers sent for repairs.

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Long Term Initiatives – Reliability Improvement

Breakdown Maintenance

Cell created for monitoring breakdown response time of complaint

centers

FLC Vans procured/ordered – three for 66/33 KV and 8 for 11 KV.

Each District given a Breakdown Mobile Van fully complete with all

equipment/material to remedy faults

Additional vans being supplemented whenever required

Breakdown staff & complaint staff provided with mobiles so as to

reduce time between receipt of complaint and initiation of action

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Breakdown Maintenance contd..

Increased mobility of breakdown staff by way of better

conveyance vehicles

Regular monitoring of critical item of stores required for

EHV & 11 KV breakdown maintenance

Maintenance Contract being awarded at district levels

Out-sourcing of routine maintenance of 11/0.4 kV

unattended/attended Substations

Long Term Initiatives – Reliability Improvement

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Long Term Initiatives – Customer Care

Call centre’s capacity augmented – inbound seats

increased to 323 % than that during the DVB time.

Customer “help desks” opened at district levels (nine

opened till now) for “single window” customer service.

More than 190 drop-boxes have been installed across

Delhi, Nodia, Gaziabad and Faridabad for easy payment of

bills.

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Long Term Initiatives – Energy Audit

End-to-end linking of consumers i.e., grid substation to 11 KV

feeder to dist. transformer to LT feeder to consumers.

Energy meters on incoming 66/33 KV feeders being installed.

Installation of meters on 11 KV feeders & distribution

transformers to be carried out.

Complete end-to-end metering would ensure:-

proper accounting of input & output at each stage

losses occurring at each stage

proper allocation of accountability & responsibility

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Long Term Initiatives – Revenue Cycle Improvement

Commercial

Consumer Survey & Route Sequencing Completed in all districts but one.

Meter replacement drive underway - would help in eliminating revenue

leakages.

All new meters installed are electronic.

225 Grid meters & 1300 feeder meters being procured

Meter Description Meter Installed % of Electronic Meter in the System

HT Meter (For LIP Consumer) 300 100

LT CT Meter 2500 30

Poly Phase Whole Current 33000

Single Phase 155000 9%

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Commercial contd..

All LIP consumers read through MRI.

Meter reading through data loggers initiated in number of

districts.

Meter reading outsourced to established parties - reading

through MRI commenced.

ABB mandated on pilot basis to conceptualize, design &

implement electrification of unauthorized colonies on HVDS

basis – would arrest major revenue loss.

Long Term Initiatives – Revenue Cycle Improvement

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Billing & IT

Billing in erstwhile DVB was very disjointed - billing at various

places on various platforms and lot of manual billing also.

Since taking over, effort made to integrate billing from

various platforms into one single platform.

Cleaning of master database underway – action on

exceptions initiated.

Systems and procedures being put into place for data

validation at data entry stage itself

Streamlining of payment accounting process completed

Long Term Initiatives – Revenue Cycle Improvement

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Billing & IT contd..

For improvement in bill delivery, corrections in database

incl. physical checking being undertaken.

Duplicate bill printing facility implemented at districts to

provide better and quick service to the consumers

Communication Link between Delhi and Mumbai

established and connectivity also established between all

district offices and the corporate office.

Long Term Initiatives – Revenue Cycle Improvement

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Long Term Initiatives - Parivartan

Accenture, one of the leading consulting companies roped in to revamp and streamline IT Billing, Metering, Credit Collection & Consumer Care.

Dedicated team of Accenture and BSES formed to embark upon a “Parivartan Initiative”.

The initiative has three objectives

Get a Grip - identify major issues, initiatives, immediate “stop bleeding” actions

Design Solutions – Design appropriate processes & organisational changes

Prioritise & implement – Prioritise initiatives

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Long Term Initiatives - Parivartan

Metering

Customer Data Management

Meter Information Management

Meter Reading Activities

Data Input to Billing System

Billing

Data Entry and Validation

Bill Processing

Bill Printing and Dispatch

Credit and Collections

Collection efficiency

Abatements

Payment Accounting

Float Management

Payment Modes

Customer Help Desk• Roadmap for districts and services• Detailed pilot design• Operational and monitoring metrics• IT plan• Organisation Plan

Customer Help Desk• Roadmap for districts and services• Detailed pilot design• Operational and monitoring metrics• IT plan• Organisation Plan

Customer Call Centre• Information management• Integration with back end

Other Customer Touchpoints• Integration with backend

Customer Communication

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Long Term Initiatives – Load Flow Studies

Detailed load flow & system automation studies proposed

to be carried out.

Studies to suggest measures to bring down system losses

and improve reliability to world standards – most optimal

configuration of network systems.

Reputed experts/consultants appointed recently.

Data compilation completed for Delhi & Mumbai

The work on detailed study report commenced for Delhi &

Mumbai simultaneously

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BUSINESS PLANS FOR TURNAROUND

HVDS system being implemented in new colonies to be electrified

Preventive Maintenance is strengthened at Grid substation and DT level

GOAB switches being replaced by RMUs

System being augmented

Enforcement and vigilance raids

Network Optimisation and Distribution Automation

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BUSINESS PLANS FOR TURNAROUND

Call centre concept in operation for Fault Locating Vans, Cable Jointers

Facilities created for ease of bill payments

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