DGVCL

Illuminating homes in south Gujarat

Dakshin Gujarat Vij Company Limited (DGVCL), one of the four state discoms in Gujarat, was incorporated in 2003 post the unbundling of the erstwhile Gujarat Electricity Board. The Surat-headquartered DGVCL’s area of operations is spread across seven districts – Bharuch, Narmada, Surat (except part of Surat City), Tapi, Dangs, Navsari and Valsad. It has a consumer base of over 3.3 million and annual revenue of Rs 142.47 billion. The discom’s service network encompasses urban landscapes, industrial corridors and rural regions including agricultural lands, forests and a vast coastal part. The company functions in four circles, 19 divisions and 143 subdivisions.

DGVCL is among the best performing discoms in the country with an aggregate technical and commercial (AT&C) loss level of 6.06 per cent in 2018-19 as compared to a national loss level of over 22 per cent. The discom has consistently registered profits. Its collection efficiency stood at around 100 per cent in 2018-19. The Ministry of Power, has rated DGVCL with the highest A+ grade for five consecutive years for its very high operational and financial performance capability. The discom has also won several industry accolades for its performance and initiatives in green energy.

While the nationwide Covid-induced lockdown had an initial impact on DGVCL’s power load and revenue collections, DGVCL has managed to navigate the crisis reasonably well. Despite challenges, the discom is confident of sustaining its performance for the current fiscal. It is also expected to maintain its capex for the current fiscal. The discom is going full steam ahead with its strategic plans for network augmentation and strengthening, involving underground cabling and installation of ring main units (RMUs), automated meter reading (AMR) deployment, geomapping of assets, etc.

Operational performance

DGVCL’s distribution network stood at 113,510 ckt. km as of March 2019. It comprises 60,284 ckt. km of high tension (HT) lines and 53,226 ckt. km of low tension (LT) lines. The discom has over 314 substations and 2,411 feeders in its network at the 11 kV and 22 kV levels, all of which have been metered. Further, the discom has achieved a 100 per cent metering level for distribution transformers. Also, all consumer categories have been fully metered, except for agricultural consumers.

The average AT&C losses of DGVCL improved from 6.08 per cent in 2017-18 to 6.06 per cent in 2018-19. Its distribution losses were 5.22 per cent in 2019-20. Notably, the company’s distribution loss is less than 7 per cent in urban areas. The feeder losses for all HT consumers and Gujarat Industrial Development Corporation (GIDC) feeders have been around 1 per cent.

The discom’s collection efficiency has been consistently at around 100 per cent. As of October 2020, the company’s average System Average Interruption Frequency Index of feeders stood at 6.34 (units of interruptions per customer) and the average System Average Interruption Duration Index stood at 515 minutes.

Financial highlights

During 2019-20, DGVCL sold 19,692 MUs of power as compared to 19,080 MUs in 2018-19. During 2019-20, of the total power sold, 47.33 per cent (9,321 MUs) was sold to HT industrial consumers, 30.08 per cent (5,924 MUs) to non-residential general purpose and LT consumers, 16.22 per cent (3,195 MUs) to residential general purpose consumers and the remaining to other consumers.

In 2019-20, DGVCL’s revenues stood at Rs 142.47 billion, a 9.18 per cent increase over the previous year. A profit-making utility, DGVCL registered net profits of Rs 1.3 billion in 2019-20, in comparison to a net profit of Rs 392.67 million in 2018-19. Its debt-equity ratio was stagnant at 0.01 in 2019-20 as well as in 2018-19.

Dealing with Covid-19

During the pandemic-induced lockdown, DGVCL took various initiatives to weather the storm. One of the challenges that the discom faced was the sudden slump in power demand and revenue. Pre-lockdown consumption was around 70 MUs per day, which went down to 30 MUs per day soon after the lockdown was announced. The demand is, however, now back to normal and is set to rise due to reopening of industrial and allied sectors.

In addition, due to the lockdown, the discom could not undertake actual readings. The actual reading in the four months (April-July) showed a revenue shortage of around Rs 14 billion. Also, some of the other challenges that the discom faced were manpower constraints owing to movement restrictions and procurement challenges.

To ease the revenue collection process, the company upgraded its e-platforms and made digital application available for its consumers for supporting bill payments during this period. In line with the state government’s directives, DGVCL has also provided financial relief in the electricity bills. In the electricity bills for May and June issued in July, about 1.9 million residential users have been provided with Rs 720 million worth of relief. Besides, consumer complaints were handled online and the discom made efforts to address them through digital means.

Future plans

Despite Covid, DGVCL has not reduced its capex plans for this year. In 2019-20, DGVCL’s capex was Rs 8 billion-Rs 9 billion, and it is still the same.  One of the key initiatives planned by the discom is AMR for industrial consumers. So far, all its HT consumers have been shifted to AMR. There are over 4,220 consumers  contributing around 50 per cent of the revenue, and the discom is able to directly monitor them. Hence, its distribution loss for this segment is very less. Thus, DGVCL plans to shift all LT mixed load consumers as well (with load above 40 kW) to AMR meters in the coming year or so. With this, a huge proportion of its industrial consumers are expected to be covered through AMR.

Another key area that the discom is focusing on is the undergrounding of its network and installation of RMUs. Also, DGVCL is geomapping all of its assets across all seven districts. Further, it has recently implemented a pilot project for live feeder status monitoring to improve power reliability and monitor its feeders in real time to keep track of fault events before the issues are raised by consumers.

DGVCL along with other state discoms is also implementing the Suryashakti Kisan Yojana, for the solarisation of agricultural connections. As per the scheme, farmers with electricity connections are given solar panels as per their load requirements. The state and central governments give 60 per cent subsidy on the cost of the project. Under this scheme, 21 feeders have been allotted to DGVCL.

In addition, DGVCL will be implementing a new scheme recently launched by the state government, the Kisan Suryodaya Yojana, to provide daytime power to agricultural consumers.

Conclusion

DGVCL’s initiatives to improve its performance and modernise its network through the deployment of new technologies, coupled with its proven track record of strong operational and financial performance, will support the company in its efforts to improve its services and meet the demands of its large consumer base.

 

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