Equipment Supply To Power Projects National Power Conference 2009

Equipment Supply to Power Projects
National Power Conference 2009

4th December 2009
NEW DELHI
By
P.K. Agarwal
General Manager - Marketing (Power Sector)
Bharat Heavy Electricals Ltd.
‘BHEL House’, Siri Fort,
New Delhi – 110049
Equipment Supply to power projects 4th Dec 2009 1
1. Indian Power Sector - Past, Present and Future
2. BHEL and its contributions to Power Sector
3. Power Sector Issues Related to Equipment
4. Steps taken by BHEL
5. Steps taken by other agencies
6. Major Concerns for Domestic Industry

Pre- Electricity Act 2003 period
All India Capacity Addition
COMMISSIONING CAPACITY ADDITION
YEAR (ALL INDIA)
TH+GAS NU HYDRO TOTAL
1991-92 2428 220 320 2968
1992-93 2989 220 613 3822
1993-94 3425 0 386 3811
1994-95 4139 220 913 5272
1995-96 1977 0 68 2045
1996-97 964 0 635 1599
1997-98 2973 0 464 3437
1998-99 3480 0 513 3993
1999-2000 2593 440 1493 4526
2000-01 2035 440 1275 3750
2001-02 1848 0 1019 2867
All India Capacity addition was always less than BHEL’s

installed capacity

Pre- Electricity Act 2003 period
BHEL’s Capacity and Loading
• Orders on BHEL remained far below BHEL’s installed

Capacity during VIII, IX Plan and initial X Plan period.
• In 90s, economy opened up with substantial incentives by

the Government to attract Foreign/ Private developers
and power equipment manufacturers - further
threatened already under-utilized domestic equipment
manufacturing capacities.
• Targets for X Plan (41,110 MW) similar to IXth Plan

(40,245 MW) – no indication of improvement in success
rate till enactment of Electricity Act 2003.

Post - Electricity Act 2003 period
BHEL’s Capacity Augmentation
Various initiatives by Ministry of Power and enactment of

Electricity Act 2003 and notification of Electricity Policy
provided clearer road map for Country’s Accelerated
Capacity Addition Programme with higher confidence to
Manufacturers and suppliers.
Capacity augmentation schemes immediately taken up in

BHEL based on MOP/ CEA’s projections.

Demand Summary of All India Forecast
(AS PER 17th EPS REPORT)
Source: CEA

Large Capacity Addition
Projected Power Demand (GW)

1400
1207
1200
Installed
1000 Capacity
785
800 Projected
Peak
GW 600 510 Demand
Installed 331
400 Capacity, 215
132
200
0
2007 2012 2017 2022 2027 2032
Year Increase in
demand by 54% in
every 5-year Plan
Source: IEP, Table 2.5

Indian Power Sector - Future Scenario
• Based on the projected demand, Integrated Energy Policy

projections for Capacity addition requirement is:
XI Plan - 102,000 MW (target - 78,577 MW)
XII Plan - 104,000 MW
XIII Plan - 151,000 MW
XIV Plan - 197,000 MW
• Integrated Energy Policy envisages coal to remain the

dominant fuel source till 2031-32
• To bring the per capita consumption to World average level,

4 fold growth required.

CEA Conclave on Key Inputs – 2009
Orders for Main Plant Equipment 11th Plan (as on end Aug’ 09)
(Figures in MW)
MAIN PLANT THERMAL HYDRO NUCLEAR TOTAL

EQUIPMENT
SUPPLIER
BHEL 36,531 6,017 500 43048
(54%)
OTHERS 25,192 9,490 2,880 37562
(46%)
TOTAL 61,723 15,507 3,380 80,610
Out of above, capacity ordered on Chinese Main Plant

Suppliers - 16,419 MW
All Orders placed for 11th Plan Main Plant Equipment

Status of Implementation Of 11th Plan (as on end Aug’ 09)
(as on Aug 2009)
• 16,395 MW (20%) capacity already commissioned till date.
• 64,215 MW (80%) under construction i.e. orders placed and

work is in progress.
• In addition to above, 12,000 MW Captive Power Plants are

under execution, against which2700 MW has been
commissioned and balance under construction.
• Against target of 14,000 MW from Renewables, 5482 MW

commissioned as on 31.03.09
• Coal linkages have been provided to all thermal projects. A

capacity of 14,507 MW is scheduled for commissioning during
2009-10.
• Besides, projects aggregating to 32,000 MW capacity for

commissioning during the 12th Five Year Plan are also
under execution.
Status of Implementation Of 11th Plan..contd.
Reasons for delay in 11th Plan projects

• Delay in placement of orders - mainly Civil Works & BOPs.
• Delay and non-sequential supply of material for Main Plant and BoPs.
• Shortage of skilled manpower for erection and commissioning.
• Contractual disputes.
• Inadequate deployment of construction machinery.
• Shortage of fuel (Gas & Nuclear).
• Delay in Land Acquisition.
• Delay in creation of infrastructure facilities.

Mid Term Review
Summary of Likely Capacity Addition during 11th Plan
LIKELY WITH HIGH

COMMISSIONED WITH EFFORT TOTAL
DEGREE OF
(MW) (MW) (MW)
CERTAINITY (MW)
HYDRO
CENTRAL SECTOR 1030 1892 800 3722
STATE SECTOR 2401 453 280 3134
PRIVATE SECTOR 0 2461 1030 3491
ALL-INDIA 3431 4806 2110 10347
THERMAL
CENTRAL SECTOR 3490.0 11430.0 3730 18650.0
STATE SECTOR 5627.2 12874.2 850 19351.4
PRIVATE SECTOR 4371.5 12964.0 5900 23235.5
ALL-INDIA 13488.7 37268.2 10480 61236.9
NUCLEAR
CENTRAL SECTOR 220 3160 0 3380
STATE SECTOR 0 0 0 0
PRIVATE SECTOR 0 0 0 0
ALL-INDIA 220 3160 0 3380
TOTAL
CENTRAL SECTOR 4740.0 16482.0 4530 25752.0
STATE SECTOR 8028.2 13327.2 1130 22485.4
PRIVATE SECTOR 4371.5 15425.0 6930 26726.5
ALL-INDIA 17139.7 45234.2 12590 74963.9

XII and XIII Plan : Total (Tentative) Capacity Addition
Capacity in MW Capacity in MW
Category (XII Plan) (XIII Plan)
Thermal (incl. Gas) 76,600 70,000
Nuclear 3,400 8,000
Hydro 20,000 24,500
Total 1,00,000 1,00,000 (approx.)
Share of Super Critical Sets expected to be 43,640 MW (59% of Coal based

sets) in 12th Plan
Share of Super Critical Sets expected to be 64,000 MW (100% of Coal based

sets) in 13th Plan
Source: CEA

Summary of 12th Plan Capacity Addition Requirement- 1,00,000 MW
Nuclear, 3400,
3.4% Hydro, 20000,
20%
Nuclear
Thermal, Hydro
76500, 76.5% Thermal
•Thermal - 76,500 MW
•About 32,000 MW already under
construction
Estimated Phasing of Fund Requirement for Generation during 12th Plan
(Figures in Rs. Crore)
TYPE 2012-13 2013-14 2014-15 2015-16 2016-17 TOTAL
HYDRO 21,857 23,694 25,058 27,136 28,904 1,26,649
THERMAL 76,367 66,905 62,701 61,867 62,828 3,30,668
NUCLEAR 5,753 6,955 7,443 8,255 9,360 37,766
TOTAL 1,03,977 97,554 95,202 97,258 1,01,092 4,95,083

Status of BoPs For 11th and 12th Plan Projects
Name of the BoP BoPs required for projects Tentative Estimated Requirement
system Commissioned & under const. of BoPs for 12th Plan
for 11th Plan Projects (Nos.) Thermal Projects (Nos.)
Coal Handling 67 148
System
Ash Handling 68 148
System
DM Plant 71 211
Cooling Towers 143 218
Chimneys 116 77
Fuel Oil System 74 148
PT Plant 76 160

Recommended Capacity Addition during 13th Plan (2017-22)
Nuclear, 8000,
8%
Hydro, 24500,
24%
Nuclear
Hydro
Thermal, Thermal
70000, 68%
TOTAL-1,00,000 MW

Increasing Share of Higher Size Supercritical Units


BHEL Credentials
•A Rs.28,033 crore turnover Engineering &

Manufacturing enterprise of its kind in India
•A ‘Navaratna’ company and a Major Integrated

Power Plant Equipment Manufacturer in the
World
•Profit Making Company since 1971-72
•Consistent Dividend Paying Company for over

thirty years (FY 1976-77 onwards)
•References in over 70 countries
•Installed base of more than 100,000 MW

Role of BHEL in Power Sector
• A major manufacturer of power plant equipment for various fuels.

• Fully indigenized technology up to 600 MW from world leaders
• Supplies Steam turbines, generators, boilers and matching auxiliaries upto 800 MW ratings
including supercritical sets of 660/800 MW.
• 307 coal based sets installed, including 35 sets of 500 MW rating
• 365 nos. BHEL make Hydro Utility sets installed in the country
Installed capacity- Utility Generation

1,38,165 MW (31.03.09) 2008-09
Others,
Others, 27%
35%
BHEL, BHEL,
65% 73%
Practically every 3 houses out of 4 in India are supplied power generated from BHEL sets

BHEL Sets – A Profile
As on 31.3.09
Coal based utility sets of BHEL make installed in the country
MW Nos.
500 35
250 29
195/200/210 147
100-130 70
< 100 26
Total (63,160 MW) 307 Nos.
Includes Basin Bridge (since abandoned)
Hydro utility sets of BHEL make in the country: 365 nos. (16996 MW)

BHEL Sets – A Profile
Plant Load Factor (Coal based BHEL Sets)

During 2008-09, 191 BHEL supplied coal based sets achieved PLF of over
70%. Of these, 77 sets registered PLF of over 90% and 56 sets achieved
PLF between 80% - 90%.
NATIONAL BHEL SETS

AVERAGE
Overall 500MW 250 MW 210/200/195
MW
77.0% 80.5% 89.2% 90% 81.6%
Operating Availability (OA)

During 2008-09, 141 sets achieved OA higher than 90%
Overall 500 MW 250 MW 195/200/210 MW

88.4% 92.7% 92.6% 90.3%

Performance of 500 MW range Sets
BHEL vs. International Level
(Last Five Years Averages)
100%
86.20% 89.20%
80%
North American
60% Sets
BHEL Sets
40%
20% 9.10% 7.50% 4.61% 3.24%

0%
Operational Availability Planned Maintenance Forced Outages due to
(OA) Equpt.
Source: North American Electric Reliability Council, (NERC).


Issues in Power Sector Related to Equipment
- Issues Identified in August’09 CEA Conclave

Critical Issues Discussed in the Conclave Related to Equipment
• Promoting indigenous manufacturing of Boilers and Turbines.
• Manufacturers of Main Plant to develop ancillary units/ vendors

commensurate with capacity addition, deliveries to be
sequential.
• Advance procurement action for long lead items like Forgings and
castings.
• Need to attract more vendors in BOP.
• In view of acute shortage of Erection/ Commissioning Agencies

for executing Civil and Mechanical works, to discuss how to
attract more agencies.

• IT based monitoring for projects - ways to achieve this.
• Major EPC Contractors should necessarily have construction

machinery of their own and not leased ones. Also to play a
proactive role in building of large skilled manpower.
• Transportation Facilities.
• Improvement of infrastructural facilities to speed up project

implementation .
• Standardization: This would help in reducing design,

engineering and approval time for drawings thus reducing
construction period of power plants.

• There is need to create indigenous capacity for long lead items such as
Castings and Forgings for Turbines & Generators, Boiler quality plates, P-
91 piping and CRGO sheet steel for transformers.
• Latest technologies need to be adopted to optimize on the use of Land and

Water. Promoting new technologies with reduced water requirement.
• Acquisition of Energy assets abroad by CPSUs/ Industry.
• Latest Technology Options:
 Need to develop a Road Map for incentivising efficient technologies

in Generation, Transmission and Distribution.
 Technologies for minimizing consumptive water requirement by
adopting Air Cooled Condensers and Hybrid Systems for Cooling at
Thermal Power Stations, Committee by CEA.


STEPS TAKEN BY BHEL
TO MEET ENHANCED
CAPACITY ADDITION
REQUIREMENT

•CAPACITY BUILDING
•CAPABILITY BUILDING

BHEL Capacity Augmentation Plan for Power Plant Equipment
20,000 MW
Per annum
15,000 MW
Per annum
10,000 MW
Per annum
Target Achieved in Dec Plan: Dec 2009 Mar 2012

Completion: 2007 Ant. By Mar. 10
Capital Rs 961 crs Rs 2,940 crs* Rs 1,593 crs

Expenditure: (Rs. 3,901 Crs) (Rs. 5,494 crs.)
Phase: Phase-1 Phase-2 Phase-3
* Excluding CFFP & Fabrication Plant and Figures in Brackets are Cumulative

Initiatives taken to meet challenges
Manufacturing capacity augmentation:
• Manufacturing capacity enhancement for Power Plant Equipment from

10,000 MW to 15,000 MW and then to 20,000 MW per annum by Mar’12.
• Capacity augmentation of transformers from 20,500 to 45,000 MVA.
• Capacity enhancement of Electrical Motors from 1340 nos. to 2250 nos.
Salient Features of BHEL’s Manufacturing Capacity Addition Programme
• In view of uncertainty of Gas based and Nuclear Capacities, provision for

inter- changeability of facilities have been made
• Inter-Unit and Intra-Unit Load sharing
• Respective facilities have inbuilt Capacity for Spares based on their
consumption.
• Installed Capacity has 10-15% stretch margin, as demonstrated in past

New marketing Initiatives:

• 660 & 800 MW Super Critical Thermal Sets
• 600 MW sub-critical sets
• 250 MW Circulating Fluidized Combustion Chamber (CFBC)
Boiler for Lignite and Low grade fuel
• Advance class Gas Turbine
• Nuclear Steam Generators for 700MWe
Partnerships forged with SEBs/ GENCOs for leveraging equipment

sales
BHEL along-with CEA has prepared standard specifications in

September 2008 for Boilers and Turbine - Generators of 500 MW
and above.
Strategic Alliances:
• Partnerships forged with NTPC, NPCIL, KEL, & HEC strengthening

the supply chain by developing additional sources for critical
inputs
• Entered into collaborations for manufacture of Supercritical Units

 Boiler - Alstom
 Turbine Generator – Siemens
• Transmission : JV route being adopted covering Transformers,

GIS, ACBs, HVDC etc.

Site
Sitecapability
capabilityenhancement:
enhancement:
- -Heavy
Heavy lift
lift and
and other
other crawler
crawler crane
crane added
added suitable
suitable for
for erection
erection of
of
Ceiling
Ceiling Girders of 600/660/800 MW sets (Existing Crawler Cranes : :
Girders of 600/660/800 MW sets (Existing Crawler Cranes
83
83Nos.
Nos.Being
Beingadded
added: :41
41Nos.
Nos.inin2009-10,
2009-10,77nos.
nos.inin2010-11
2010-11&&41 41
Nos. in 2011-12).
Nos. in 2011-12).
- -Portal
Portal Crane
Crane for
for lifting
lifting 500
500 MW
MW && above
above Stator
Stator ( ( Existing
Existing 22 Nos.
Nos.
being enhanced to 4 Nos. in 2010-11)
being enhanced to 4 Nos. in 2010-11)
- -Induction
Induction Heating
Heating equipments
equipments (Existing
(Existing 87
87 Nos.
Nos. Additional
Additional 95
95 Nos.
Nos.
being added in 2010-11 and 50 nos. in 2011-12)
being added in 2010-11 and 50 nos. in 2011-12)
- -Strand
Strand Jack
Jack System
System being
beingprocured
procuredby
by2010-11
2010-11(was
(wasbeing
beingHired
Hired
earlier)
earlier)

Supply Chain Management (SCM) Initiatives:
 Advanced Manufacturing Actions (AMA) are being taken for timely

procurement of long lead items like large castings & forgings, critical
pipings, CRGO etc.
 An understanding has been reached with Sheffield Forge Masters

International Ltd., UK for technology transfer in the area of Forgings
 Leveraging Information Technology
 Negotiation through Reverse Auction

 Implementation of e-Procurement
Pilot Project at Tiruchy unit successfully implemented.
Under implementation at Hardwar, Bhopal, Hyderabad, EDN, BAP.
 Long Term Rate Contracts
 To reduce procurement cycle time, rate contracts have been finalized

with vendors for inputs like steel, copper, CRGO, transformer oil etc.


 Vendor Base Expansion
 40 new vendors added in 2008-09 for BOPs. 38 new vendors added in 2009-
10 (till Nov’09). 12 more likely by Mar’10
Sl.No Item description No. of Status/ action plan
. vendors
1 Coal Handling Plant 8 4 more under evaluation. Planned by Jul’10
2 Ash Handling Plant 6 2 more under evaluation. Planned by Jul’10
3 Cooling Tower 7 2 more under evaluation. Planned by Jun’10
4 Condensate Polishing Unit 5 3 more under evaluation. Planned by June 10.
5 Air conditioning systems 4 1 more under evaluation. Planned by Jun ’10

6 Hydrogen Generation Plant 3 1 more under evaluation. Planned by Jan’10
7 Mill reject system 4 2 more under evaluation. Planned by Jul’10
 Office opened in Shanghai, China for sourcing items with limited vendors
 ‘Away Centre’ fabrication adopted
 Rate Contract for Service Contracts
 Specifications under finalization

 Outsourcing: Enhanced thrust is being given for outsourcing of low

technology/ non-core manufacturing.
 Delivery of Piping
 Additional suppliers for Fittings identified to ensure timely delivery of Piping.
 Empanelling more fabrication vendors and upgrading existing vendors
capability.
 Adopting repeat design of a typical standard unit in line with Chinese Model.
 Standardization measures initiated to reduce cycle time.
Layout of Boiler Island piping
Utility requirement of Boiler Auxiliary
Pipe sizes

HR Initiatives:
• In last two years BHEL has added 8500 persons (ETs, STs & Artisans).
• Recruitment cycle reduced from 8-10 months earlier to 3-3 ½ months
now.
• New windows opened for intake
• Lateral recruitment of experienced persons
• Direct Campus recruitment
• Special recruitment for difficult sites in North East and J&K.
• Re-employment of executives who had earlier resigned.
Skills Development:
• BHEL has taken a stake in ITI in Kabiguru Industrial Training Centre at

Bolpur, Shantiniketan, West Bengal in partnerships with DVC, CIL and
Sriniketan Shantiniketan Development Authority.
• Welding Research Institute at Trichy being leveraged to train high
pressure welders of contractors. Programmes at Trichy as well as 4
PS-Regional offices.

Project Management Initiatives:

• Project Management being accorded top priority to match manufacturing and
site facilities capacity augmentation for meeting the challenges of 11th Plan
and beyond.
• Centralized Project Management Group located at Delhi provides single
window service for the Customer, working in close coordination with Project
Management Groups in respective Manufacturing Units and Regions
• Accelerated Training Programme under-taken to develop Power engineers in
shorter time to meet the growing requirement of erection and Commissioning.
Two Batches of 30/35 Engrs. already trained. 45 Engrs. Under training.
• ERP :
• Implemented in Trichy, Bangalore, Hyderabad. Being spread to other units
of BHEL
• Discussions with SAP consultants planned in I Qtr. 2010-11
• Web Based project monitoring system (Primavera) is developed and under
implementation for all ongoing and future projects
• Video Conferencing with Manufacturing Units and Regional Headquarters.
Being implemented in Sites
Additional measures to meet gaps between Shop Capacity and

Load
Joint Venture with M/s. HEC for additional capacity for Castings and
forgings
•Development of Vendors for machining jobs
•Identification of Vendors for sourcing finish machined casings. 3 nos.
finish machined LP shafts of 500 MW already ordered for delivery during
2010-11.
•Part of supplies for Super-critical supplies being sourced from
collaborators
•Multi-tasking Machines and multi-Skilling of operators.
•Sourcing from Siemens for TG sets (semi-finished and finished) tie-up
With
Withabove
aboveMeasures,
Measures,BHEL
BHELShop
ShopManufacturing
ManufacturingCapacity
Capacity
shall
shallnot
notbe
beaabottle-neck
bottle-neckininmeeting
meetingthe
theCapacity
Capacityaddition
addition
targets
targets

Follow-up of International Conclave on Key Inputs
• Task Force formed comprising MoP, CEA and CII to

coordinate with industry regarding various inputs for power
sector. CII has organised number of dialogue with specific
industry groups and interested entrepreneurs.
• Task Force formed 7 Nos. Specialized Subgroups formed to

assess 11th Plan requirement and constraints being
experienced and suggestions for removing them.
• Regional level meetings – interactions with industry to

sensitize them of huge requirement of Power Sector and to
encourage new vendors.

Manufacturing capacity planned by New Ventures
 Due to initiative by MOP and CEA for augmentation of

capacity and technology transfer within the country,
several new JV Companies have come forward to take
up manufacturing of supercritical power equipment
Qualifying requirements have been formulated to

facilitate participation of JVs in the bidding process

Manufacturing capacity planned by New Ventures ….contd
 Some other new manufacturers have built up/ are planning to

build up manufacturing capacity for manufacture of
supercritical boilers in technical collaboration with overseas
manufacturers
• Thermax in collaboration with Babcock-Wilcox

• Cethar Vessels in collaboration with Riley Power
• BGR Energy in collaboration with Foster Wheeler
 Action has been initiated by L&T and Bharat Forge for castings
& forgings

JVs and Other Steps Taken
• Tender floated for Bulk order of 11X660 MW units with

mandatory indigenous manufacturing.
• Some new players ( L&T and Bharat Forge) have plans to enter
into the area of setting up capacity for Critical long lead inputs .
• Qualifying requirements of Main Plant Equipment and BoP

vendors reviewed by CEA and Utilities advised to promote entry
of new entrants.
• Committee formed to look into requirement of CRGO and

discussions with manufacturers. Some companies evinced
interest in manufacturing CRGO.
• Existing manufacturers augmented their capacity for 765 kV

transmission equipment & upgradation of testing facilities.

JVs and Other Steps Taken
• Larsen & Toubro (L&T) and Nuclear Power Corporation of India

(NPCIL) have recently formed a Rs 1,725-crore joint venture
for specialized steel and forging products.
• Chennai-based BGR Energy Systems is expected to formally

sign the collaboration agreement with Hitachi of Japan for the
manufacture of turbines for power project.

Major Recommendations of Conclave and Action Taken
• 38 ITIs already adopted, 13 ITIs being adopted by CPSUs, 12

ITIs have been/ are being adopted by Private Utilities.
• NPTI taking action on creation of accredited training

institutions for specialized skills.
• 7 Power Utilities already making provision of atleast 1.5% of

salary budget for HRD as per recommendations of National
Training Policy. Further efforts being made to increase it to
5%.


Transportation
• CEA Conclave in August 2009 has identified ‘Development of transportation

facilities, including port handling facilities for equipment and fuel’ as a key issue
• 13th Plan and beyond will have only Super-critical and ultra super-critical
thermal sets. Due to the dimensions constraint all 800 MW sets and many 660
MW set will have to be necessarily transported by road. Due to their enormous
weight road and bridges of sufficiently high strength to with-stand their weight
required.
• Advance class Gas turbines, which have to be sent in fully assembled condition
and hence, weigh very high and require road and bridges of high strength.
• Generator Stator of Sipat Project from the Russian manufacturer was held up at
highway between Mumbai and Nasik for more than 3 months as the Highway
was not fit for transportation of the Generator Stator. Such situation to be
avoided in future.
• Transportation facilities including dedicated freight corridor, port handling
capacity, facilities for equipment and fuel need to be enhanced to
commensurate with planned capacity addition.

Chinese presence in Indian Powers Sector
• Share of Chinese in Capacity addition during 11th Plan (As per the
Mid-term review of Power sector) - 20,967 MW accounting for
around 28 percent of the over-all capacity addition of 74,964 MW.
Similar trend seen in 12th plan.
• About 95% (19,833 MW out of 20,967 MW) of imports from Chinese
firms are done by private Customers
• Many concerns have been raised about the quality, performance
and the efficiency of the equipment. - CEA/ NTPC report after visit
to China in April ’09.
• Even though the initial capital cost of Chinese sets is lower,
operating cost is higher than Indian sets resulting in over-all higher
cost – CLSA report
• Concern for Energy security due to non-development of local
vendors for spares and services

DISADVANTAGES SUFFERED BY DOMESTIC MANUFACTURERS:
 Taxes/ Financing
o Sales Tax / VAT; Entry-tax / Octroi – Applicable to supplies from
domestic manufacturers only and not in case of overseas supplies
due to high-sea sales
o Higher Financing Cost due to 6 - 8% differential in Indian and
foreign interest rates
 Lack of quality infrastructure like:

o Roads and Bridges to handle Heavy consignments for Power
Plants
o Adequate facilities at the Ports
o Un-interrupted Power supply
o Transport facilities

DISADVANTAGES SUFFERED BY DOMESTIC MANUFACTURERS .. contd
 Domestic manufacturers competing with foreign suppliers in India, suffer

cost disadvantage due to:
o the incentives enjoyed by the foreign competitors from their
respective Governments, as the Project is a export order for them
o Higher cost of Raw material.
o Dependence on foreign sources for Raw Material and
Components like CRGO, Castings and Forgings, Boiler grade
steel and high pressure/ temperature pipes, as they are not
available in the Country.
o Artificial control of Chinese Yuan
o Limited indigenous vendors for various other components,

DISADVANTAGES SUFFERED BY DOMESTIC MANUFACTURERS .. contd
 Non-availability of skilled man-power with the sub-contractors for

specialized jobs like high pressure welding etc.
 Adequate quantity of Tools and Plants with the sub-contractors/ in the

market for hire
All the above disadvantages result in higher cost and longer time cycle for
execution of the Projects.

Concerns for Domestic Players
• In addition to BHEL, many other manufacturers like Bharat

Forge, L&T, JSW etc. are reportedly setting-up of manufacturing
facilities and acquiring technology for Power Plant Equipment,
based on the encouragement from Government.
• The additional domestic capacities thus being created involves
huge investments.
• Additional Capacity of BHEL and capacities of new
manufacturers provides adequate manufacturing capacity in the
country as well as competition to each other to offer the best
technology and products.
• Therefore, a level playing field is required to be provided to
Indian manufacturers so that the facilities being set up by them
are adequately loaded.

THANK YOU

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Equipment Supply to Power Projects

National Power Conference 2009

2. BHEL and its contributions to Power Sector

3. Power Sector Issues Related to Equipment

4. Steps taken by BHEL

5. Steps taken by other agencies

6. Major Concerns for Domestic Industry

All India Capacity addition was always less than BHEL’s

Equipment Supply to power projects 4th Dec 2009 3

• Orders on BHEL remained far below BHEL’s installed

• In 90s, economy opened up with substantial incentives by

• Targets for X Plan (41,110 MW) similar to IXth Plan

Equipment Supply to power projects 4th Dec 2009 4

Various initiatives by Ministry of Power and enactment of

Capacity augmentation schemes immediately taken up in

Equipment Supply to power projects 4th Dec 2009 5

(AS PER 17th EPS REPORT)

Equipment Supply to power projects 4th Dec 2009 6

Projected Power Demand (GW)

Equipment Supply to power projects 4th Dec 2009 7

• Based on the projected demand, Integrated Energy Policy

• Integrated Energy Policy envisages coal to remain the

• To bring the per capita consumption to World average level,

Equipment Supply to power projects 4th Dec 2009 8

MAIN PLANT THERMAL HYDRO NUCLEAR TOTAL

Out of above, capacity ordered on Chinese Main Plant

Equipment Supply to power projects 4th Dec 2009 9

• 16,395 MW (20%) capacity already commissioned till date.

• 64,215 MW (80%) under construction i.e. orders placed and

• In addition to above, 12,000 MW Captive Power Plants are

• Against target of 14,000 MW from Renewables, 5482 MW

• Coal linkages have been provided to all thermal projects. A

• Besides, projects aggregating to 32,000 MW capacity for

Reasons for delay in 11th Plan projects

• Shortage of skilled manpower for erection and commissioning.

• Inadequate deployment of construction machinery.

• Shortage of fuel (Gas & Nuclear).

• Delay in Land Acquisition.

• Delay in creation of infrastructure facilities.

Equipment Supply to power projects 4th Dec 2009 11

LIKELY WITH HIGH

Equipment Supply to power projects 4th Dec 2009 12

Thermal (incl. Gas) 76,600 70,000

Nuclear 3,400 8,000

Hydro 20,000 24,500

Total 1,00,000 1,00,000 (approx.)

Share of Super Critical Sets expected to be 43,640 MW (59% of Coal based

Share of Super Critical Sets expected to be 64,000 MW (100% of Coal based

Equipment Supply to power projects 4th Dec 2009 13

(Figures in Rs. Crore)

TYPE 2012-13 2013-14 2014-15 2015-16 2016-17 TOTAL

HYDRO 21,857 23,694 25,058 27,136 28,904 1,26,649

THERMAL 76,367 66,905 62,701 61,867 62,828 3,30,668

NUCLEAR 5,753 6,955 7,443 8,255 9,360 37,766

TOTAL 1,03,977 97,554 95,202 97,258 1,01,092 4,95,083

Equipment Supply to power projects 4th Dec 2009 15

Cooling Towers 143 218

Fuel Oil System 74 148

Equipment Supply to power projects 4th Dec 2009 16

Equipment Supply to power projects 4th Dec 2009 17

Equipment Supply to power projects 4th Dec 2009 18

2. BHEL and its contributions to Power Sector

3. Power Sector Issues Related to Equipment