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India spends ₹25,354 crore on power theft clampdown

Posted: 24 Nov 2014     Print Version  Bookmark and Share

Keywords:India  power  meter  distribution network 

India is going to great lengths to crack down on rampant electricity theft that has long plagued its power sector, with plans to spend ₹25,354 crore to deploy metering in cities and upgrade its old distribution networks, the Ministry of Power said on Thursday.

The "Integrated Power Development Scheme" will help reduce technical and commercial losses, as well as improve collection efficiency. The earmarked funds from the government will be offset from the total estimated cost of ₹32,612 crore.

Many Indians have come to view cheap, even free, power as a right rather than a privilege. Poor political will to address the thefts, and ageing transmission lines have badly hurt local distribution companies, with as much as 40 per cent of electricity going unpaid for in several states.

Addressing power theft to reduce losses forms part of Prime Minister Narendra Modi's key policy platform to bring uninterrupted power to the entire country. Modi was previously credited with tackling power shortages during his time as chief minister of Gujarat, curbing power theft and repairing the finances of distribution companies hit hard by unpaid bills.

The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi, gave its approval to launch the scheme. State discoms and power departments will award the contracts for the execution of projects, which are scheduled to be completed within 24 months from date of award.

Wising up to security needs

"The new wave of communications on the electric grid is occurring more at the end of the network, closer to the end-user," said Michael Markides, research manager for Smart Grid and Utilities at IHS Technology. "Utilities are now able to economically install [and] use communications networks that allow real-time monitoring of the distribution layer of the network, which is the medium- and low-voltage part of the grid." (Read full story about the smart grid here: Is it time for India's power grid to get smarter?)

Devices that can connect, interact and cooperate with each other in their surrounding environment and with control centres—simply put, the Internet of Things—have opened a lot of opportunities in the power sector. And smart meters are one of such devices.

For utilities, IoT means increased income margins, reduced electricity theft and the capacity to predict system failures and vulnerabilities. In addition, IoT also promotes smarter energy consumption on the consumer end, from individuals to communities and cities.

They enable more information and connectivity by interconnecting devices across industries through the Internet to form a smarter grid. Adding communication layers to electricity distribution systems, however, exposes the grid to potential cyber-attacks. Still, analysts said system protection is generally good, and utilities, vendors and regulators are constantly assisting in mitigating hacks on the network.

The smart grid's remote metering device makes it easier and more efficient for energy providers to bill their customers. There is a unique identification code associated with each meter, and this protects the credentials inside the devices, said Avanthika Satheesh, Energy and Environment Practice senior research analyst at Frost & Sullivan Asia Pacific.

Most meter manufacturers use at least AES 128bit encryption between the meter and the head-end, but it is the control of the meter that is a bigger threat, said Marcus Torchia, Worldwide Smart Grid Strategies research manager at IDC.

"At an individual meter level, control in the wrong hands could be a nuisance to the homeowner or crippling to the business owner if the power is shut off or throttled," he explained. "At an aggregate level, thousands or tens of thousands of meters controlled by a hacker could be very problematic."

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