Chinese companies may be shut out of the world’s largest electricity smart metering programme under way in India, two people aware of the development said, as the government is concerned about potential malware in these equipment. The Union power ministry is not in favour of state-run Energy Efficiency Services Ltd (EESL) using Chinese metres as it implements the programme, they said, requesting anonymity.
The move, which comes against the backdrop of a border clashes in Ladakh, which left 20 Indian soldiers dead, assumes importance given that the National Democratic Alliance government plans to convert all electricity meters into smart prepaid meters by 2022. A smart meter architecture requires a two-way communication network, control centre equipment and software applications that enable near real-time gathering and transfer of energy usage information.
“EESL shall not import Chinese smart meters, given that these are connected to the electricity distribution networks, which is a sensitive sector," said a government official cited above.
The smart meter programme aims to replace 250 million conventional meters to help raise annual revenues of debt-laden discoms to ₹1.38 trillion. Also, smart meters are key to the success of India’s proposed ₹3.5 trillion distribution reform scheme—tentatively named Atal Distribution System Improvement Yojana (Aditya)— which aims to cut power losses below 12%.
EESL, last week, put on hold a tender awarded to Indonesia’s PT Hexing to supply 2 million smart meters, over concerns about its ownership and local manufacturing plans. PT Hexing is said to be owned by Hexing Electrical Co, based in Hangzhou, China.
Putting an order on hold and seeking clarification is the first part of the order cancellation process. This comes against the backdrop of reports about Uttar Pradesh Power Corp. Ltd’s decision to scrap a consignment of Chinese smart meters being procured by EESL.
“Our tender conditions are very clear. Any supplier needs to have a manufacturing facility in India to be eligible to supply to us," said Saurabh Kumar, managing director of EESL, a joint venture set up by NTPC Ltd, Rural Electrification Corp. Ltd, Power Finance Corp. Ltd (PFC) and Power Grid Corp. of India Ltd.
Of the total order for which PT Hexing was the lowest bidder, around 10,000 meters have been supplied from its Indonesia facility, which have also been kept on hold. “PT Hexing had promised that they will set up a facility here. We asked them formally last week about the status of their manufacturing facility in India. Till the time we don’t receive a satisfactory answer along with evidence, this complete order has been put on hold," said Kumar.
This comes against the backdrop of India’s strategy of erecting tariff barriers and other obstacles, including subsidizing finance for promoting local power equipment makers and prior-permission requirements for imports from countries with which it has a conflict, as reported by Mint on Tuesday. While queries emailed to a power ministry spokesperson weren’t answered till press time, PT Hexing couldn’t immediately be contacted.
Kumar of EESL added that of around 1.6 million smart meters supplied by EESL to the Uttar Pradesh, Haryana and Delhi governments, 1.4 million were made by Genus Power Infrastructures Ltd’ Rajasthan facility. The remaining were supplied by ITI and Larsen and Toubro.
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