Quoted in an article in Power Today
Excerpt below -
The Indian power capacitor industry has been witnessing negative growth in the last few years. Several reasons, including stagnant demand, delays in project execution, stiff competition and fiscal difficulties faced by EPC contractors and utilities etc., contributed to the sluggish market. It was further accentuated by sharp price drops in the international market, and cut price imported capacitors entering the Indian market through legal and grey market channels. As such the power capacitors market comprising largely of low and medium voltage capacitors, is a small industry estimated to be less than Rs 1,000 crore, today.
´As per our estimate, the market size of low voltage capacitors is around Rs 500 crore and that of the medium voltage capacitors is close to Rs 400 crore,´ reveals Ajay Joshi, Vice President - Capacitors, Universal Cables Limited. He further adds: ´Five years back there was tremendous growth to the extent of 30 per cent. Presently average growth is rate is 5 to 7 per cent only.
´Several factors including project delays, reduction in incentives have played a role. For instance, in Odisha, the government reduced the incentives given to the power sector, resulting in consumers not bothering to install additional capacitors. ´We have taken up this issue with the government through Indian Electrical and Electronics Manufacturers Association (IEEMA)´ he adds.
Meanwhile, Abraham Varughese, General Manager- Power Quality Marketing, Schneider Electric India has a different view to offer. According to him, the capacitor industry was stagnating for the last few years. However, he says, ´We have seen some growth, about 8-10 per cent, in the last fiscal. This includes the medium voltage capacitor and low voltage capacitor market. In fact, the industry is almost coming to the level of double-digit growth.´
Other industry professionals too predict a turnaround for the industry, basic driving factor being the developments in the power sector.
The cumulative growth in the Indian power sector, and recent clearance of several projects valued at Rs 1.83 lakh crore by the Indian government are expected to provide a fillip to the capacitor industry. In addition, the massive rural electrification, increased use of electric pumps in irrigation and industrial purposes and increased focus on energy efficiency are also expected to boost demand. Power capacitors help to improve the overall power factor (PF) of the system and as such they form a very important part of energy-efficient systems.
Subhash Gupta, Chief Executive Officer, Standard Capacitors Pvt Ltd, lists out the other factors that are boosting demand: ´Maximum demand charges, energy charges, charge on the basis of apparent energy (kVAh), which is a vector sum of kWh and kVArh, power factor penalty or bonus rates, as levied by most utilities etc., will increase the demand for power capacitors. With the tremendous industrial growth, the demand for capacitors is going to be enormous in times to come.´
An article on role of capacitors in energy efficient systems.
Nowadays there is increasing awareness about saving energy and utilising the available energy efficiently by employing energyefficient devices. Thus, there is a trend to convert conventional systems to energyefficient systems. A capacitor, which improves the power factor of the system, forms an integral part of the energy efficient system. Industry is rapidly changing over to energy efficient drives/devices such as DC drives, variable speed AC drives, energyefficient lamps, UPS, etc.
Though these devices facilitate the use of energy efficiently, they reduce the power factor of the system and inject harmonics in the system. These problems further gives rise to another problems and ultimately there is reduction in the overall efficiency of the system.
DEVICES AND PROBLEMS CAUSED BY THEM:
1. DC drives:
DC drives are used as they give better efficiency than that of AC drives. Also the speed control of DC drive is easy. AC supply is converted into DC supply using converters. Converters reduces power factor and introduce harmonics. AC------> Converter------> DC
2. Frequency converters : These are used to control the speed of AC drives. First AC supply is converted into DC supply which is again converted into AC with different frequency. This also reduces the power factor and introduces harmonics. AC (50Hz) ------> DC(Using Converter)------> AC (Using Inverter) (Variable frequency)
3. Electronic items: For accurate and automatic control, there is an increase in use of electronic controls Also use of computers has increased. All these electronic items require switched mode power supply (SMPS) which draws current over a part of each half cycle. This reduces the power factor.
4. Energy efficient lamps: These lamps draw an almost instantaneous current over a short portion of the voltage wave. This reduces the power factor.
All these devices form what is called as nonlinear load, which not only causes the problem of low power factor but also problem of harmonics.
POWER FACTOR CONTROL
In an electrical distribution system, low power factor and harmonics cannot be tolerated as it reduces the overall efficiency of the system and also affects the working of other devices. To improve the power factor, the use of capacitor is essential. Where harmonic level is high only capacitor does not serve the purpose and use of power factor correction capacitors along with the harmonic filter becomes essential. Reactive power compensation is very important as it not only improves the efficiency of the system but also reduces the penalty for low power factor
BENEFITS OF HIGH POWER FACTOR:
Reduction in power loss, improvement in efficiency of the system
CAPACITOR EFFICIENCY & INSTALLATION NORMS
Capacitor itself is an energy-efficient product as it has low power loss. Its efficiency can be as high as 99.9%. In addition to this, capacitors has low initial cost, flexibility in choosing rating, compact size, easy installation, less maintenance etc.
How has the growth of your company been? Are you working on government projects?
The demand for capacitors has definitely gone up in the last few years, partly because of a push from utility companies to charge on KVA consumed. We have also seen a lot of smaller businesses and even households off late show interest in power management through capacitors. In the last few years, our company´s growth has been in the range of 10-18 per cent. After a slight dip in FY2013-14, our turnover increased 74 per cent in FY2014-15, which is a very positive sign. Every year, we increase our targets to cater to more consumers across the country and are now looking to venture into previously untapped requirements for controlled capacitor banks for agricultural capacitors and residential capacitors too.
We work extensively with many government departments such as Railways, Ordinance Factories, National Hydro Development Corporation, Bharat Petroleum and many others for supply as well as turnkey projects and even annual maintenance, to ensure a steady high power factor throughout the year. A new project with the Rail Coach Factory is underway and in prototype stage. The implementation of this will lead to the development of one of its kind power management system for the Indian rail coaches.
How well is this industry doing is the government supportive?
Analysts forecast capacitor market in India to grow at CAGR of 12.46 per cent over 2014-19. We visualize tremendous potential due to expected industrial growth in view of the plan of setting up of 100 smart cities by the Government of India along the Delhi-Mumbai Corridor. These smart cities will have industrial hubs, which would be set up on the most modern lines with advanced technology. Domestic players need to grab this opportunity.
What factors boost demand for capacitors? Will this growth be converted into actual capacity expansion and higher utilization?
Factors that are boosting demand are the maximum demand charges, energy charges, charge on the basis of apparent energy (kVAh)--which is a vector sum of kWh and kVArh, power factor penalty or bonus rates, as levied by most utilities etc. With the tremendous industrial growth, demand for capacitors is going to be enormous in times to come. As per available production data of capacitors, the capacity installed is under-utilized at present and there is a substantial scope of higher production with the capacity already installed. Therefore, at present, there may not be capacity expansion due to growth in demand, but sooner or later capacity expansion will take place.
How successful have Indian manufacturers been in implementing advanced technology in capacitors?
There is a vast range of capacitors being manufactured in India. Compared to many other countries, we are quite ahead in capacitor technology. So, as far as implementation of technology is concerned, this answers the question. A lot of R&D is being undertaken by Indian capacitor manufacturers and we will soon be a global leader in this field.
What are the challenges this sector faces? Have global players dominated this space till now?
A major challenge faced by Indian manufacturers is availability of quality raw material at competitive prices. We have to import raw material, especially film, which destabilizes the cost of capacitor manufacturing due to currency fluctuations. To be able to compete globally, this factor need to be attended to.
Please share your views on reactive power management.
Electrical machinery as well as electrical devices connected to an alternating current system require both active and reactive power to function properly. A major function of reactive power is voltage control. Some of the major instances of blackouts in first world countries have been insufficient voltage and reactive power support systems [contd.]
The industrial sector accounts for approximately 37% of total energy consumption of India1. Of this, the manufacturing sector consumes about 66 percent (2004-05). In most such facilities, the majority of electrical equipment is inductive loads such as transformers, motors, welding sets, furnaces etc. These inductive loads require reactive power in order to maintain the device’s internal magnetic field which is needed for its smooth running, in addition to active power for performing useful mechanical work. Thus, for a given KW of load, the KVA drawn from the system will be higher, which will lead to more burden on the supply side. This ratio of active KW used to the actual KVA drawn from the system is a measure of efficiency of the electrical system and is also known as the power factor of the system. The closer this factor is to unity, the more efficient is the system in terms of better utilization of electrical machines on the consumer’s end and lower the line losses and need for larger capacity equipment on the utility company’s end. Thus, there is a huge push from the government for installation of power factor improvement equipment.
In many states, the penalty levied for low power factor is as high as 1% on the total bill amount for PF between 0.85-0.9 and as much as 2% below 0.85 PF2. The tariffs for supply of electricity at high tension (3.3 KV and above) are very high on per KVA usage basis and also there is huge penalty on exceeding the billing demand over the contracted demand. In our recent experience, the power factor of an installation of Delhi Jal Board was as low as 0.6 before installation of capacitors which led to severe penalization for poor efficiency by the utility provider. After installation of power factor control system, the power factor came up to 0.98 and utility demand fell by 30%, thus leading to significant savings for the consumer. In addition to this, uncorrected power factor was leading to power loss and voltage drops, which was addressed through power factor correction. Thus, on the consumer’s end, there is definitely an advantage in bolstering their long-term energy efficiency through power factor control systems.
On the other hand, for the utility companies too, there is an advantage in installing capacitor banks in order to generate reactive power at the source. So, that the burden of reactive power generation at the consumer’s end is reduced and installation of the PF system for the consumer locally becomes economical. This will also result in improving the voltage regulation as the capacitors will ensure a leading current supply and therefore lead to better electrical service to the consumers. In one such case, the power factor of Tehri Hydro Electric Development Corporation was 0.85. Upon installation of static capacitors and APFC panel in medium voltage system, the power factor at the supply station was improved to 0.98, resulting in higher capacity being available to service more consumers.
Also, due to the increased number of rectifier-controlled motors in use in industries as well as non linear loads such as battery chargers, SMP supplies and variable frequency drives that are extensively in use in commercial settings these days, the electrical supply gets severely polluted with harmonics leading to distortion of the input sine wave. These voltage and current harmonics also increase power losses, which in turn has a negative affect on the electrical utility distribution systems. To mitigate the harmonics, consumers have to install harmonic block reactors and active harmonic filters at their end, which also serves another purpose of improving power factor by providing reactive current as and when needed. These devices are almost a necessity in hospitals and organizations employing sophisticated electronic equipment.