Power firms buy weather forecasts to project demand

Power firms buy weather forecasts to project demand
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First Published: Wed, May 06 2009. 09 28 PM IST

Quality matters: NDPL chief operating officer Arup Ghosh.
Quality matters: NDPL chief operating officer Arup Ghosh.
Updated: Wed, May 06 2009. 09 28 PM IST
New Delhi: Not just India’s farmers but power companies, too, are now interested in weather forecasts—and willing to pay for such services.
Quality matters: NDPL chief operating officer Arup Ghosh.
At least two private sector power utilities have begun to buy weather forecasting services to project demand for electricity.
Delhi-based Skymet Co. is supplying customized weather data to Anil Ambani-owned Reliance Infrastructure Ltd and Tata group-owned North Delhi Power Ltd (NDPL).
“We give 24-hour forecasts... and this helps them prepare their forward contracts,” says Jatin Singh, managing director of Skymet.
Electricity distribution companies firm up their demand projections a day in advance. They then send the information on demand and supply to the state load dispatch centre. They also have an option to update it every six hours.
“The parameters that the private forecaster provides are more wide-ranging than that of provided by IMD (India Meteorological Department). Further, IMD currently provides hourly data and not in every 15 minutes as required by us for demand forecasting,” said a Reliance Infrastructure spokesman.
Typically, weather forecasting in India is done by the government-run IMD. However, in the past few years, a clutch of companies such as Mumbai-based Weather Risk Management Services Pvt. Ltd and RMSI Pvt. Ltd have started providing such data as well as setting up their own infrastructure to calculate risk to crops from weather anomalies and computing insurance packages for farmers.
According to Arup Ghosh, chief operating officer of NDPL, the data provided by Skymet is “much better” because it is updated every 15 minutes, compared with the free weather data provided by IMD that provides forecasts for the next 24 hours and other extended periods only.
On his part, an IMD spokesperson said: “We are working on such applications for weather data. By next year, we should be able to provide more customized data—especially on temperature and humidity—to those who ask for it.”
Skymet, however, has been able to rope in only these two companies so far and doesn’t provide services to any of the state-run utilities that manage the bulk of India’s power needs. The company said its current annual revenue from the two firms does not exceed Rs20 lakh a year.
Meanwhile, Tantra Narayan Thakur, chairman and managing director of PTC India Ltd, the country’s largest power trading firm, said: “Weather forecast plays a limited role in the power trading business as compared to the distribution business. Shortage of power leads to its sale anyway. However, going forward, weather data will play an important role in the power trading business.”
An official with the Indian Energy Exchange, owned by the Multi Commodity Exchange of India Ltd, said: “Last year, electricity worth Rs15,000-Rs18,000 crore was traded and the market is still nascent.” He declined to be named, citing lack of official permission from his company to talk on the subject.
India, which is battling a power shortage and has among the highest power transmission and distribution losses in the world, is in dire need of efficient power management. The country has a 12% shortage in power during the peak hours of 5-11pm, but experts say this number could be higher.
To make matters worse, of the country’s total installed capacity of 1,47,000MW, only around 85,000MW is operational at any given point of time.
jacob.k@livemint.com
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First Published: Wed, May 06 2009. 09 28 PM IST