However, it would be worth knowing the categorization of technical and commercial losses that contribute to the total losses. The theft comes in the latter category. Majority of theft is happening because the line is open to theft! The pole and the wires are bare! The voltage is at lower level than transmission and thus useful to run the 240 V equipment. (Theft almost always occurs at 400V and 240V level and not on transmission levels). Not much of energy auditing is done in most of the state utilities. Long low tension (LT) line are being pulled to reach villages under much publicised government schemes. Low tension lines are many times over the High tension lines causing more technical I2R losses. Transformer are running at less than optimal efficiency when infact they should have the efficiency rate close to 99% since they do not have any moving part !

It’s a vicious circle. Theft is done when people are not willing to pay the high price of electricity. Power companies, as per the regulatory framework, are assured their 16% ROI in distribution business and hence, the most of the losses are again put back to the consumer with increase in tariff. It’s never the power companies which decide the tariff, it’s the regulator. Very few people realise this fact.

Mumbai has infact one of the best distribution network with only 2-3% losses in theft and around 10-11% AT&C (Agg Tec and Comm losses) losses. However, the major contributing factor has been the complete underground cable system making it difficult to tap and steal. Let’s take the case of Delhi. The BBC article pegs the losses at 40% for Delhi. Having some experience in 2 out of 3 power companies that operates in Delhi, post privatization the losses have actually come down from almost 60%+ to 30-35% ! That’s a huge saving for the government and citizen of Delhi as more power is going to the rightful owner thus decreasing the burden of purchasing short term power at higher rate! (Thats a really hot market right now. Captive power plants are minting money because of demand-supply curve getting royally skewed!) What caused this turnaround were the concentrated efforts of all the 3 private companies (NDPL, BSES Yamuna and BSES Rajdhani) that resulted into one of the best and most effective energy auditing practices adopted in India. Use of analytics had never been so effective before in this field. Electromechanical meters were changed to electronic meters amid huge protests. Consumer complained that electronic meter runs faster. That’s the perception! Their electromechanical meter got slow with age (moving part) and consumer are used to pay for the less number of units. Underground cables have been put wherever possible instead of overhead. How would you tap that!? Overhead conductors are now coming with a sheath.

Delhi has been a success story not only for the companies but also in the political circles where privatization is considered a dirty word. There seems to be no logic why the government discarded the Delhi privatization model after such a success and went for franchisee with a time frame of 8-10 years license. No company in its good mind would be willing to put much CAPEX and efforts to bring down the losses without having the surety of actually leveraging the profits, which aint possible in short time. Torrent is already having a hard time in Bhiwandi which it took as a franchisee and now Crompton Greaves is taking Nagpur. Interestingly enough, in Napur case, government opened only the residential and commercial circles for bidding while keeping the industrial region, which consumes the maximum power at highest rate without giving much headache, in their own kitty!

PS: Sorry for the long comment. Just could not manage to put in my thoughts in a line or two!