VIDEO: India to spend $21.6 billion on smart grid infrastructure

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India is looking to smart grid infrastructure to help tackle an out-of-control electricity theft problem and improve reliability. Theft costs the Indian power sector $16.2 billion per year.

India's government has already committed billions of dollars in funding for smart grid infrastructure and cumulative spending is forecasted at $21.6 billion over the period 2015-2025, according to a new study published today by Northeast Group.    

"India loses more money to theft than any other country in the world," said Ben Gardner, president of Northeast Group. "The state of Maharashtra—which includes Mumbai—alone loses $2.8 billion per year, more than all but eight countries in the world. Nationally, total transmission and distribution losses approach 23% and some states' losses exceed 50 percent. Most Indian utilities are financially unsustainable."

India's central government has responded with billions of dollars in promised funding for smart grid infrastructure. In November 2014, Prime Minister Modi announced $4 billion in funding for smart metering programs. Additionally, over $8 billion is available for loss reduction programs and dozens of projects are now underway across India's 29 states. Northeast Group's study analyzes the complex regulatory frameworks and industry structures across the states.

"India's electricity demand growth is set to exceed 7 percent per year over the next decade," added Gardner. "In addition to smart metering, current pilot projects focus on distribution automation and wide area measurement, as well as home energy management and IT. Overall power sector investment will include adding 43 million new electricity connections and nearly 3m kilometers of new circuits."

For international vendors — largely closed out of the China market — India represents the largest long-term smart grid opportunity in the world. International vendors will compete against leading Indian vendors Secure, Genus, HPL, Larsen & Toubro, Avantha, Reliance and others.

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