Power ministry mandates energy accounting for discoms to curb power losses

The Ministry of Power on Monday said it has mandated energy accounting of distribution companies (discoms) to reduce electricity losses.

"As an important step under the ongoing power sector reforms, the Ministry of Power today mandated electricity distribution companies to undertake energy accounting on a periodic basis," the ministry said in a statement on Monday.

The regulations in this regard have been issued by the Bureau of Energy Efficiency (BEE) with the approval of the Ministry of Power, under the provisions of the Energy Conservation Act, 2001.

The notification stipulates quarterly energy accounting by discoms through a certified energy manager within 60 days. There will also be an annual energy audit by an independent accredited energy auditor. Both these reports will be published in the public domain.

Energy accounting reports will provide detailed information about electricity consumption by various categories of consumers and the transmission and distribution losses in various areas.

It will identify areas of high losses and theft and enable corrective actions.

This measure will also enable the fixation of responsibility on officers for losses and theft. The data will enable the discoms to take appropriate measures for reducing their electricity losses.

The discoms will be able to plan for suitable infrastructure up-gradation as well as demand-side management (DSM) efforts in an effective manner. This initiative will further contribute towards India's climate actions in meeting our Paris Agreement goals, it stated.

These regulations have been issued under the ambit of the Energy Conservation Act, 2001, with an overall objective to reduce distribution sector inefficiency and losses, thereby moving towards the economic viability of discoms.

BEE has certified a pool of national accredited energy auditors and energy managers who possess expertise in preparing energy accounting and audit reports, duly providing recommendations for loss reduction and other technical measures.

The regulations were pre-published in April 2021 for seeking public comments and thereafter, the Ministry of Power held detailed discussions with various stakeholders before finally issuing these regulations, it stated.

In September 2020, through a separate notification, all power distribution companies were notified as designated consumers under the Energy Conservation Act.

Owing to the potential benefits of energy auditing on the entire distribution system and retail supply business, it was imperative to develop a set of comprehensive guidelines and frameworks, so that all distribution utilities across India can adhere to and formulate actions.

Energy accounting prescribes accounting of all energy inflows at various voltage levels in the distribution periphery of the network, including renewable energy generation and open access consumers as well as energy consumption by the end-consumers.

Energy accounting on periodic basic and subsequent annual energy audit will help to identify areas of high loss and pilferage and thereafter suggest focussed efforts to take corrective actions.

The regulations issued on Monday provides a much-awaited broad framework for discoms to carry out annual energy audit and quarterly periodic energy accounting with necessary pre-requisites and reporting requirements to be fulfilled.

Objectives to be achieved through periodic energy accounting include the development of a comprehensive energy accounting system to quantify and determine actual losses in the power distribution system, segregated across technical and commercial losses.

It is also aimed at identifying areas of leakage, theft, wastage or inefficient use, thereby paving the way for tackling the current challenges of high transmission and distribution (T&D) losses.

It will enable and ensure an independent third-party energy audit of the distribution system to arrive at a true and fair picture of T&D losses. It will also enable discoms to undertake targeted efficiency improvement activities to reduce T&D losses in priority areas/customer segments.

It is also aimed at providing a basis for prioritising energy capital investments and help budget more accurately to achieve maximum results. It will help in the identification of overloaded segments of the network for necessary capacity additions.