In India, average T & D (Transmission & Distribution) losses; have been officially indicated as 26 percent of the electricity generated. There is immense potential to improve the supply side energy efficiency by minimizing the transmission and distribution loss at its distribution network. This paper focuses mainly on carbon credit generation potential of T&D loss reduction projects in India.

1. Reduction in Transmission and Distribution Losses, An
opportunity for earning carbon credits
1
Mr. Krishan Kumar Kapil
Abstract
In India, average T & D (Transmission & Distribution) losses; have been officially indicated as
26 percent of the electricity generated. There is immense potential to improve the supply side
energy efficiency by minimizing the transmission and distribution loss at its distribution network.
This paper focuses mainly on carbon credit generation potential of T&D loss reduction projects
in India.
Background:
Around the Globe, Transmission and Distribution Losses constitute a very high percentage in the
supply of generated electrical Energy. India is far from the global standards of T&D losses which
are about 5-10 per cent. According to World Resources Institute (WRI), India’s electricity grid
has the highest transmission and distribution losses in the world (26%). (Source:
http://www.nationmaster.com/graph/ene_ele_pow_tra_and_dis_los_of_out-power-transmission-distribution-losses-
output&date=2004)
As per the latest data available, 12 states and union territories had their T&D losses in excess of
30 per cent in 2004-05. Assam tops the list losing more than half of the electricity generated (51
per cent). National capital, Delhi is the next biggest loser with 45 per cent, followed by Rajasthan,
Madhya Pradesh, Jammu and Kashmir and Bihar with 45 per cent, 41 per cent, 40 per cent and 39
per cent respectively. Puducherry, Jharkhand and Tamil Nadu have been able to keep their
transmission and distribution losses below 20 per cent at 18 per cent, 18 per cent and 19 per cent
respectively.
Reasons for high technical losses
As per TERI, The major reasons for high technical losses in India are:
 Inadequate investment on transmission and distribution, particularly in sub-transmission
and distribution. While the desired investment ratio between generation and T&D should
be 1:1, during the period 1956 -97 it decreased to 1:0.45. Low investment has resulted in
overloading of the distribution system without commensurate strengthening and
augmentation.
 Haphazard growths of sub-transmission and distribution system with the short-term
objective of extension of power supply to new areas.
 Large scale rural electrification through long 11kV and LT lines.
 Too many stages of transformations.
 Improper load management.
 Inadequate reactive compensation
 Poor quality of equipment used in agricultural pumping in rural areas, cooler air-
conditioners and industrial loads in urban areas.
Components of T&D losses
As per TERI, Energy losses occur in the process of supplying electricity to consumers due to
technical and commercial losses. The technical losses are due to energy dissipated in the
conductors and equipment used for transmission, transformation, sub- transmission and
distribution of power. These technical losses are inherent in a system and can be reduced to an
1
Business Consultant-CDM, Enzen Global

2. optimum level. The losses can be further sub grouped depending upon the stage of power
transformation & transmission system as Transmission Losses (400kV/220kV/132kV/66kV), as
Sub transmission losses (33kV /11kV) and Distribution losses (11kV/0.4kv). The commercial
losses are caused by pilferage, defective meters, and errors in meter reading and in estimating
unmetered supply of energy.
CDM Opportunities in distribution network
The United Nation for Climate Change Convention (UNFCCC), the apex body for CDM projects,
has developed two baseline and monitoring methodologies under which the T&D loss reduction
projects can be applied for CDM. They are
 AMS IIA: Supply side energy efficiency improvements transmission and distribution
 AM0067: Methodology for installation of energy efficient transformers in a power
distribution grid
According to these methodologies, the implementation of EE measures for T&D loss reduction
can include:
 Up-grading the voltage on a transmission/distribution system
 Replacing existing transformers with more efficient transformers (e.g., replacement of a
silicon steel core transformer with an amorphous metal transformer)
 Increasing the amount of pipe insulation in a district heating system.
The technologies or measures may be applied to an existing transmission or distribution systems
or be part of an expansion of a transmission/distribution system.
For any project to be considered for CDM, it has to fall under the applicability condition of above two
methodologies only. However, Project proponents are encouraged to propose a new set of guidelines
and baseline methodologies for considering other similar kind of projects under CDM.
CDM project status in distribution network
At present, only two such projects have been implemented and applied for generation of carbon
credits. The details are given as below:
Host
Project Title Reductions
Country
Supply side energy efficiency improvement by implementing Power
India 44,521
Interface Units in Northern India
Supply side energy efficiency improvement project implemented by
India 3,923
KDHP, at Munnar, Kerala state, India
(Source: http://cdm.unfccc.int/Projects/Validation/index.html)
At present, Enzen Global is also involved in development and registration of one such project
involving implementation of energy efficiency measures in the distribution network of
Coimbature Municipal Corporation. The contract for implementation of EE measure has been
awarded to an ESCO (Salzer Electronics Limited, Coimbature). Enzen Global Environment
Practice team is providing advisory services for development, registration, issuance of carbon
credits (CERs) and marketing of CERS for the project.

3. Other similar Energy efficiency projects in distribution network
Host
Project Title Reductions
Country
Karnataka CDM Photovoltaic Lighting Programme India 20,328
Visakhapatnam (India) OSRAM CFL distribution CDM Project India 48,850
Yamunanagar & Sonipat (India) OSRAM CFL distribution CDM
India 48,539
Project
Replacement of incandescent bulbs with CFLs in households in
India 50,556
Kadapa Circle, Andhra Pradesh, India
Chhattisgarh Lighting Improvement Project ( CLIP) in Rajnandgoan
India 48,008
Circle, Chhattisgarh, India
Pune (India) OSRAM CFL distribution CDM Project India 29,988
Rwanda Electrogaz Compact Fluorescent Lamp (CFL) distribution
Rwanda 18,578
Project
Republic
Bucheon(Korea) Fawoo technology LED application CDM project 226
of Korea
Orissa Lighting Energy Efficiency Project (OLEEP) in Aska
India 18,692
Division, Ganjam District, Orissa,India
Orissa Lighting Energy Efficiency Project (OLEEP) in Baripada
India 18,705
Circle, Mayurbhanj District, Orissa, India
Uttar Pradesh Lighting Energy Efficiency Project (ULEEP) in
India 19,589
Circles I & II of Varanasi, Zone, UttarPradesh, India
Orissa Lighting Energy Efficiency Project (OLEEP) in Nuapada &
India 17,339
Kalahandi District, Orissa, India
Uttar Pradesh Lighting Energy Efficiency Project (ULEEP) in Cess
India 19,363
Divisions of L.E.S.A. Lucknow Zone, Uttar Pradesh, India
Orissa Lighting Energy Efficiency Project (OLEEP) in Bhadrak
India 20,188
Circle, Bhadrak District, Orissa,India
Orissa Lighting Energy Efficiency Project (OLEEP) in Digapahandi
India 11,229
Division, Ganjam District,Orissa, India
Orissa Lighting Energy Efficiency Project (OLEEP) in Bolangir &
India 16,370
Titilagarh Divisions, Orissa, India
Orissa Lighting Energy Efficiency Project (OLEEP) in Bhanjanagar
India 17,045
Circle, Orissa, India
Orissa Lighting Energy Efficiency Project (OLEEP) in Bargarh &
India 12,028
Bargarh West Divisions, Orissa,India
Case Study 1: Supply side energy efficiency improvement by implementing Power Interface
Units in Northern India
ACME Tele Power Ltd. (ATPL) is a leading Telecom Power Solutions provider in India.
Power Interface Unit (PIU) is one of the innovative products developed by ATPL. The
project activity aims to improve the supply side energy efficiency of an electricity
distribution system by use of energy efficient PIU. Installation of PIU at various sites
results in minimal use of grid power/diesel generator (DG) sets which helps in the
reduction of GHG emission.
It is proposed that by implementation of PIU, a total Annual net energy savings of 59,362
MWh can be achieved, resulting in annual CER generation of 44,521 tCO2e per annum.
It is estimated that by sale of carbon credits, an additional revenue of 44.74 Million INR
per annum will be generated which will substantially improve the project financials.

4. Case Study 2: Supply side energy efficiency improvement project implemented by KDHP, at
Munnar, Kerala state, India
The Kanan Devan Hills Plantations Company Pvt. Ltd. (Herein after referred as KDHP) a
successor of TATA Tea Ltd. is engaged in the business of manufacturing branded tea.
Apart from its core business of tea manufacture, KDHP also supplies electricity to its
residential, commercial and industrial consumers in the Munnar region. To minimize the
losses in its distribution system, KDHP has replaced the existing copper conductor with
new ACSR (Aluminium Conductor Steel Reinforced) in their Distribution Lines. Project
involves re-conduct ring on total transmission and distribution line of 170 Km after
identifying areas which yield more transmission - distribution loss.
The project is expected to achieve an annual net energy savings of 4,615 MWh, resulting
in annual CER generation of 3,923 tCO2e per annum. The expected CDM revenue for the
project is anticipated to be approximately 3.94 Million INR per annum.
Case Study 3: Orissa Lighting Energy Efficiency Project (OLEEP) in Bargarh & Bargarh
West Divisions, Orissa, India
Purpose of this project is to distribute Compact Florescent Lamps (CFLs), at a price
equivalent to that of incandescent lamp (ICL), to consumers in rural divisions of WESCO
( Western Electricity Supply Company of Orissa) , in Bargarh & Bargarh West Divisions,
Orissa, India . This project targets to discount & distribute approximately 198,000 CFLs
to the registered consumers of WESCO. The CFL would be distributed in exchange of a
less energy efficient (i.e. higher wattage, equivalent luminosity) Incandescent Lamps
(ICL). Orissa is part of the NEWNE (Northern, Eastern Western, and North-Eastern)
regional grid in India, which has CO2 emission factor of 0.801 tCOe/MWh, and
transmission and distribution losses of 40.00% (for Burla Circle to whom these divisions
belong). Thus, all the energy saved by using CFLs, will lead to significant reduction of
CO2 being emitted at the site of power generation.
The project would lead to an overall estimated 84,197 tCO2e of emission reduction over
a period of 7 years. The expected CDM revenue for the project is anticipated to be
approximately 84.62 Million INR.
Project risk and CDM revenue influence
The implementation of the energy efficiency measures in distribution network has various barriers
associated to it. The key barriers for such projects are:
1. High cost of distribution of electricity.
2. The technologically less advanced alternative is well established in the market and
involves lower risks due to the performance certainty. However, many EE measure
introduced are for the first time in the market and have lower market share. Thus also
entail higher uncertainties in performance
However, the additional CDM revenue will substantially help in mitigating the risk involved due
to failure of project and loss of revenue involved in the project activity. Also CDM funds will
provide the additional help for development and promotion of GHG abatement and energy
efficient technologies
Conclusion:
Considering India present generation capacity of 698,918 Gwh in the year 2007-08 of which
132,320 Gwh are generated from fossil fueled based power plants (Source: CEA). Assuming a net

5. reduction of 10% in T&D losses can be achievable by implementing energy efficiency measure in
the distribution network. The implementation of such measures will lead to an additional power
surplus of 13,232 Gwh per year. The present CO2 emission level of the regional gird, as
estimated by Central Electivity Authority (CEA) is 0.81tCO2e/Mwh. Therefore, the Reduction in
T&D losses provides an opportunity for net carbon emission reduction of 10.7 Million CO2e per
annum in India, providing a carbon market of over 6.4 Billion INR.