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JSW ENERGY BOLT | ISSUE 2
UPDATE ON POWER

SECTOR IN INDIA

The key highlight during Q4 c) allowed 85kCal/kg margin in the last few years. In 2018,

FY19 was the finalisation of for coal GCV loss between the country achieved 100%
CERC tariff regulations for unloading and firing point electrification of its villages,

FY20-24. Further, the d) permitted security and is on track to complete
demand growth is steady, expenses over & above universal household

underpinned by healthy GDP normative O&M expenses e) electrification by end of the
growth and incremental extended the useful life of fiscal year 2019. Access to

demand from newly hydro plant to 40 years from reliable supply of electricity
electrified states. However, 35 years previously f) is crucial for sustaining as

merchant tariffs have included annual scheduled well as accelerating the
moderated post the highs maintenance in calculation momentum of country’s

of October 2018 and Uday of PAF. However, it has economic growth. Better
implementation appears to tightened working capital power infrastructure is

be progressing at a norms, reduced escalation imperative for providing
sedate pace. rate of O&M expenses to thrust to the manufacturing

3.5% p.a. (although sector and successful
In March 2019, CERC
normative O&M expense implementation of
released the final tariff
have been revised upwards) programmes like ‘Make in
guidelines applicable for the
and shifted from annual PAF India’.
period FY20-24 which was
to quarterly PAF for fixed
marginally positive for the The power demand in the
cost recovery.
sector. The salient features country has witnessed a
included: a) maintained the The Government of India has steady growth in past

base RoE at 15.5% for made remarkable progress 7 quarters mirroring the
regulated thermal and run in expanding access to

of river hydro plants electricity to all the villages
b) maintained capital

structure at 70:30
debt-equity ratio

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