Traditionally, the shape of the electricity load curve remained largely unchanged in India, with only the overall quantum of demand increasing over time. To manage this growing demand, energy efficiency (EE) programs were introduced to slow down the rapid upward shift of the load curve by promoting more efficient energy use.

However, in recent years, the load curve has not only been shifting upwards but also changing in shape due to evolving consumption patterns and the integration of renewable energy sources. RE share in the generation mix is rapidly increasing to meet Renewable Purchase Obligation targets, which in turn limits flexibility on the generation side. Additionally, RE sources are designated as must-run power plants, meaning their generation cannot be curtailed under normal conditions. As a result, distribution licensees must approach demand forecasting differently, considering the net demand—which is the total demand minus RE generation—rather than the absolute demand curve.

This transformation necessitates additional strategies beyond energy efficiency to help electricity distribution companies (Discom) manage demand more effectively. To address this challenge, demand response and demand flexibility concepts have been introduced.

Demand Response (DR) involves actively modulating electricity demand in real time. Consumers either reduce or increase their power consumption based on grid requirements, often in response to price signals or incentives. This helps in balancing supply and demand, especially during peak load periods or when renewable energy availability fluctuates.

Demand Flexibility (DF) Unlike demand response, which directly adjusts the level of consumption, demand flexibility focuses on shifting electricity usage to different time periods without altering the total demand. This means rescheduling energy-intensive activities to off-peak hours, optimizing grid efficiency, and reducing strain during peak times.

Time of Day (ToD) tariffs are effective tools in energy management, particularly in countries like India, where the electricity demand is rapidly increasing. These tariffs are designed to vary the cost of electricity based on the time it is consumed, offering lower rates during off-peak hours and higher rates during periods of peak demand. This system not only incentivizes consumers to shift their energy usage to off-peak times but also helps in integrating renewable energy into the grid, improving the overall stability of the power system.

The Evolution of ToD Tariffs in India

India's journey toward adopting ToD tariffs began with legislative support through the Electricity Act of 2003. This act allowed for the differentiation of tariffs based on various factors, including the time of use. The National Electricity Policy of 2005 further advocated the establishment of time-differentiated tariffs, particularly for large consumers. More recently, Electricity (Rights of Consumers) Amendment Rules, 2023 have emphasized the importance of smart meters and data analytics in creating more efficient tariff systems.

Current ToD Tariff Landscape in India

According to the Ministry of Power, ToD tariffs now cover High Tension (HT) customers across India, with a future scope to extend these tariffs to rural and urban commercial users and EV consumers. As of now, about 16 states have adopted ToD tariffs, though their application and effectiveness vary.

The key challenge with the existing ToD structure is its misalignment with actual consumer behavior and energy availability. In many cases, consumers do not fully benefit from solar hours, which are considered off-peak, and peak hours tend to focus more on traditional evening demand periods rather than midday solar generation peaks.

Currently, in India it's mandatory of states to have ToD rates for industries above 10kw connection.

India has performed well on the renewable energy front, achieving a cumulative 82.6 GW of installed solar power capacity at the end of April 2024. As of May 31, 2024, non-fossil fuel sources consist of 45% of the total installed electricity generation capacity in India. Additionally, the framework for Sovereign Green Bonds has enabled resource mobilisation for green projects. The government has raised Rs 36,000 crore via sovereign green bonds in 2023. The Survey noted that India faces a dual challenge of meeting its energy demands while reducing carbon emissions. Phasing in of non-fossil fuel sources has remained a challenge for India, amplifying the need for a diversified set of energy sources. This is expected to help India pursue its low-emission pathways and help minimise risks associated with energy systems. Availability and affordability of financial resources will drive the green transition.

The Green Energy Corridor (GEC) projects aim to enhance renewable energy integration into India's power grid. GEC-I is operational in eight states, achieving 9,111 circuit kilometers of transmission lines and 21,303 MVA substations, while GEC-II is under implementation in seven states.

The New Solar Power Scheme, launched on January 4, 2024, focuses on electrifying 100,000 un-electrified households in Particularly Vulnerable Tribal Groups (PVTG) across 18 states and one Union Territory using off-grid solar systems.

As of March 31, 2024, the PM-KUSUM initiative has solarized 3.26 lakh agricultural pumps, and the Production Linked Incentive Scheme aims to boost solar PV module manufacturing with a ₹24,000 crore budget.

The National Green Hydrogen Mission, approved in January 2023, targets 5 million metric tonnes of annual green hydrogen production by 2030. Challenges in the renewable energy sector include financing and land acquisition. Additionally, the e-mobility sector is supported by various schemes, including the PLI Scheme for automobile components and the FAME Scheme for electric vehicles, aiming to enhance manufacturing and demand for electric mobility solutions.

The Union Budget 2024-25 has placed a strong emphasis on nuclear energy as a key component of India's future power mix. The government plans to partner with the private sector to develop Bharat Small Modular Reactors (SMRs) and invest in research and development of newer nuclear technologies.

The budget also allocates significant funds to the PM Surya Ghar Muft Bijli Yojana, which aims to provide subsidized rooftop solar installations to one crore households, offering 300 units of free electricity per month. This scheme has already generated remarkable responses with over 1.28 crore registrations and 14 lakh applications.

To enhance renewable energy integration, the government will introduce a Pumped Storage Policy and partner with NTPC and BHEL to establish an 800 MW power plant based on Advanced Ultra Super Critical (AUSC) technology. The budget also announces the establishment of a Critical Mineral Mission to secure essential resources for the energy transition.

These initiatives, along with measures to promote energy efficiency and carbon markets, demonstrate India's comprehensive strategy to balance growth, employment, and environmental sustainability in its pursuit of a resilient energy future

Climate Centre for Cities (C-CUBE) at the National Institute of Urban Affairs (NIUA) in association with the Global Covenant of Mayors for Climate & Energy (GCoM), Asia conducted a training regional workshop on Accessing Climate Finance. The workshop was conducted to help cities understand the financial mechanisms available for development climate actions for cities. The workshop was organized under the NIUA’s efforts to celebrate the U20 technical secretariat activities on priority areas of “Accelerating Climate Finance”.

MP Ensystems gave a presentation on Targeted Project Proposals - Options available to the cities. Click on full report to access the Presentation given at the workshop.

When we speak of the power sector there is a significant emphasis on topics like the role of renewable energy, how we generate power, what is the current generation mix etc. However, a crucial aspect that is often overlooked is the consumer.

A suite of smart solutions is needed to bring the power sector planners to think about what happens behind the meter with consumers being a part of the solution.

As the squeeze on natural resources continues to grow in coming years and decades, resource management will hinge on the ability to balance demand and supply while adhering to environmentally-conscious targets.

Translating India’s undoubted potential for self-sufficiency will have to begin with addressing these gaps, particularly in agriculture which still remains India’s biggest livelihood.

We explore the topic of electricity markets in India, its transmission infrastructure as well as how they function.

Consumer experience will play a vital role in this structural transformation. Watch the panel of esteemed guests discuss how consumer experience can be improved given the rapid transformation affecting the electricity sector.

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