Proving the Business Case for the Internet of Things

IoT to transform electricity sector in Andhra Pradesh

Steve Rogerson
March 14, 2018
 
The state of Andhra Pradesh in India aims to bring transformational change in the electricity sector in the country through demand side management and IoT technologies.
 
This is part of a joint initiative with California-based AutoGrid to use energy internet technologies to improve utility companies’ financial health and improve consumer experience, serving as the model for electricity sector transformation across India.
 
The initiative is aimed at adopting smart grid and IoT-based services to improve utilities’ health and customer experiences.
 
At last month’s CII Partnership Summit, chief minister Shri Chandrababu Naidu unveiled the programme, which involves demand-side management (DSM) programmes covering key segments, including agricultural pump-sets, residential and commercial air-conditioning (AC) and industrial units. The Andhra Pradesh Southern Power Distribution Company (APSPDCL) will use the programmes to evaluate its benefits to the utility as well as to the consumers in the state.
 
“The government of Andhra Pradesh shall be forming a special purpose vehicle with AutoGrid to commercialise, scale up and replicate their technology in India – as well as globally – upon the successful completion of these projects,” said Naidu. “This will also cover other energy applications such as grid-scale optimisations, battery storage and microgrids.”
 
APSPDCL provides over 28TWh of electricity annually to its nearly 11 million consumers. However, its latest statement show a net deficit of Rs3400 crores per year on annual revenues of nearly Rs14,900 crores.
 
The DSM services in the project should enable benefits of over Rs1000 crores per year when deployed at scale. The savings will be achieved via peak shaving for capex avoidance, time of use implementation to leverage cheaper power at off-peak hours, soil- moisture-based pump-set operation to reduce intelligently power used for agricultural purposes, AC cycling to drive energy efficiency and peak load shaving, and renewable integration to incorporate cheaper solar and wind power supply without impacting reliability or quality of service.
 
“This project with AutoGrid further reinforces the government of Andhra Pradesh’s commitment to become a technology leader in the IoT and energy sector,” said Shri Ajay Jain, Andhra Pradesh principal secretary for energy. “We expect this project to further extend the lead that AP has in terms of reliability and power quality, and will serve a model of how utilities across India can utilise IoT and big data analytics to improve their operations.”
 
The World Bank and government of India estimate the DSM investment potential in India is Rs160,000 crores, driving 180 billion kWh/year energy savings and avoiding 60GWh of additional generation capacity investment, somewhere in the range of Rs400,000 crores capex avoidance. However, DSM in India has yet to be widely adopted due to a broad set of limitations.
 
“We are excited to be partnering with APSPDCL and the government of Andhra Pradesh to bring a proven solution deployed at some of the leading global utilities around the world for the first time to India,” said Amit Narayan, chief executive officer of AutoGrid Systems. “This not only provides significant savings to the utility, but also delivers strong benefits to consumers, thereby aiding in improved governance.”
 
AutoGrid has deployed its DSM at dozens of utilities worldwide that manage several gigawatts of flexible load.
 
“AutoGrid has evaluated the needs of DSM in India and, by working with the utilities and government of Andhra Pradesh along with inputs from other states and utilities, has engineered a solution with a set of partners that enables several DSM use cases specific to the Indian context to be addressed effectively,” Narayan said.
 
One of the use cases proposed by AutoGrid for DSM adoption to be undertaken by APSPDCL looks at agricultural pump-sets remote activation based on time of use to match surplus and cheap power in night or mid-day, and based on soil moisture levels monitored by the IoT. This should reduce power subsidies, save ground water and provide convenience to millions of farmers with respect to the frequency of visits to their fields. The cost of AutoGrid’s proposed IoT service is said to be one hundred times less than that of solar pumpsets and ten times less than that of smart pumpsets.
 
Capex saving can be achieved via peak load shaving and return on investment through energy efficiency using remote cycling of power to residential and commercial ACs. This also leads to reduced energy bills for the consumers, and provides convenience and peace of mind with reference to AC use during night or when outside the home. The cost of delivering 1W of energy efficiency with AutoGrid’s system is said to be ten times less than the total cost incurred by the utility via a state subsidy and customer for purchase of an energy efficient AC.
 
Capex saving are also available via peak load shaving using remote and intelligent cycling of power to non-critical industrial loads. This will also enable factory owners and industrialists to monitor and control energy spending accurately, and automatically save a part of their energy costs without expensive, unpopular changes. The speed and cost of industrial demand response that AutoGrid enables represents an improvement over what was possible through complex and highly-customised industrial DSM services deployed earlier.