Smart power systems

The two largest challenges facing the Indian power sector are fuel supply uncertainty and
deteriorating distribution companies (discoms) finances. Considering dominance of coal in
India's fuel mix, coal shortages can severely impede investments in the generation segment.

Some of the problems being faced by the Indian electricity power sector are :

1. Inefficient coal linkages leading to huge losses to the private power generating
companies.
2. Lower than expected growth of electricity demand , leading to reduced PLF of
existing plants.
3. Financial stress to the generating companies. The non-performing assests are valued
at 40–60 Billion USD. This is related to 60,000 to 65000 MW of energy generation
capacity of the country.
4. Inefficient distribution companies , leading to lack of initiatives to improve efficiency
and bill collection.
5. Lack of spending on research and development of renewables and transmission
technology. The money alloted for the research was used by the government of India
to finance transition of states to GST.
6. Crony capitalism
7. The discoms have been told to give must-go status to renewable energy sources. In
practice its not followed by many countries.
8. Inflexible grid : We don’t have grid level storage systems to manage peak demand or
the fluctuation of the renewable energy systems. Pumped hydro storage systems are
being built which are expensive and time taking to build.