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Power Grid Corporation of India Directors Report, Power Grid Corp Reports by Directors
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Power Grid Corporation of India

BSE: 532898|NSE: POWERGRID|ISIN: INE752E01010|SECTOR: Power - Generation & Distribution
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Directors Report Year End : Mar '15    « Mar 14
To, Dear Shareholders,
 Ladies & Gentlemen,
 
 The am delighted to present on behalf of the Board of Directors, the
 26th Annual Report on the performance of your Company during the
 financial year ending March 31, 2015 together with Audited Financial
 Statement, Auditors'' Report and Review of the Accounts by the
 Comptroller and Auditor General of India for the review period.
 
 Financial year 2014-15 marked the completion of 25 glorious years of
 your Company. In this ''Silver Jubilee'' year, it maintained its growth
 momentum and saw a number of splendid achievements on all fronts.
 
 In the area of project execution, your Company recorded a
 capitalization of Rs. 21,760 Crore, which is the highest ever in a
 single financial year of its history. The Company''s meritorious
 performance and continuous thrust on commissioning of transmission
 assets has resulted in higher revenue & earnings, thereby added value
 for its stakeholders. The successful addition of transmission assets
 has facilitated seamless power transfer in the Country. A strong and
 highly integrated inter-State transmission system has enabled
 development of the vibrant power market and provided momentum to growth
 of the power sector.
 
 Your Company commenced implementation of Green Energy Corridors across
 the Country, giving boost to renewable generation by facilitating its
 integration with the National Grid, displaying the Company''s efforts
 towards realization of sustainable and inclusive growth. In the area of
 operational excellence, ''National Transmission Asset Management Centre
 (NTAMC)'' and ''Enterprise Resource Planning (ERP)'' have been
 operationalized. These state-of-the-art technological advances have
 enabled increased transparency & efficiency in asset management and
 facilitated remote visibility & operation of POWERGRID''s transmission
 system established across the Country.
 
 Your Company has been given ''Navratna'' status by Govt. of India and it
 continued to display Excellent performance by exceeding most of the
 targets under the ''Memorandum of Understanding (MoU) signed with
 Ministry of Power (MoP), Government of India for FY 2014-15''. Based on
 its performance against the MoU targets, the Company is poised to be
 rated ''Excellent'' for the year 2014-15, thereby maintaining the record
 of the getting ''Excellent'' rating year after year over two decades
 since signing of its first Moll.
 
 Major achievements by your Company on various fronts are mentioned
 below:
 
 - Capital investment of Rs. 22,456 Crore
 
 - Assets capitalization of about Rs. 21,760 Crore.
 
 - Commissioned new transmission assets comprising about 8,830 circuit
 kilometre (ckm) of Extra High Voltage (EHV) transmission lines, 8 new
 sub-stations and 25,786 Mega Volt Ampere (MVA) transformation capacity.
 
 - Investment approval accorded for 33 new transmission projects worth
 more than Rs. 25,500 Crore.
 
 - Maintained transmission system availability at 99.87% with number of
 trippings per line limited at 0.53 for the year.
 
 - During the year, a number of large projects were commissioned
 including important elements, viz. 765 kV D/C Wardha-Aurangabad lines 1
 & 2, 765 kV D/C Raipur-Wardha & 765kV Champa-Raipur lines for
 evacuation of power from IPP Projects in Chhattisgarh, 765 kV D/C
 Nellore-Kurnool, 765kV D/C Kurnool-Thiruvalam for Southern Region Grid
 Strengthening, 765kV 2xS/C Angul-Jharsuguda 765kV D/C Jharsuguda-
 Dharamjaygarh and 765kV S/C Satna-Gwalior-II lines.
 
 - During the year, inter-regional power transfer capacity of 4,200 MW
 has been added by the Company. The cumulative inter-regional power
 transfer capacity of the National Grid stood at about 46,450 MW at the
 end of March, 2015.
 
 FINANCIAL PERFORMANCE
 
                            (Figures in Rs. Crore, except per share data)
 
 Description                         2014-15     2013-14    Y-o-Y Growth
 
 Revenue
 
 Transmission Charges                 16,521      14,327       15.3%
 
 Consultancy-Sale of Services            381         333       14.4%
 
 Consultancy-Sale of Products              0         294          -
 
 Telecom                                 275         276       -0.4%
 
 Other Income                            603         491       22.8%
 
 Total Income                         17,780      15,721       13.1%
 
 EBIDTA                               15,354      13,427       14.4%
 
 Profit After Tax (PAT)                4,979       4,497       10.7%
 
 Earnings per Share (Rs.)               9.52        9.36        1.7%
 
 Book Value per Share (Rs.)            72.71       65.78       10.5%
 
 Gross Fixed Assets                  118,264      96,504       22.5%
 
 Long term borrowing*                 93,845      80,470       16.6%
 
 Net Worth                            38,037      34,413       10.5%
 
 Debt Equity Ratio                     71:29       70:30          -
 
 - including current maturities of long term borrowings
 
 OPERATIONAL EXCELLENCE
 
 Asset Management
 
 As on April 1, 2015, the transmission assets owned and operated by your
 Company stand 115,637 ckm. of Extra High Voltage (EHV) transmission
 lines and 192 nos. EHVAC & High Voltage Direct Current (HVDC)
 sub-stations with 231,709 MVA transformation capacity.
 
 Managing such widely spread assets across the Country has been an
 extraordinary task involving meticulous planning and observing
 stringent procedures. Maintenance activities are planned well in
 advance and an Annual Maintenance Plan is chalked out for every asset
 through live line or shutdown maintenance, as per technical
 feasibility. In the event of tower damage due to natural calamities or
 otherwise, Emergency Restoration System (ERS) is being used for
 restoration of damaged transmission towers in shortest possible time.
 Further, POWERGRID has taken initiative for development of mobile
 sub-station (truck mounted) for emergency restoration in case of
 eventuality.
 
 In spite of the challenging conditions, during the FY 2014-15, your
 Company maintained availability of the transmission network at 99.87%
 which is comparable to international standards. The number of tripping
 per line (unplanned) stood at 0.53 for the year, indicating high
 reliability of POWERGRID transmission system. This performance could be
 maintained through training, deployment of advanced techniques
 including use of helicopters for live line aerial patrolling, hot line
 maintenance upto 765 kV voltage level, equipment conditioning
 monitoring including dynamic testing, thermo-vision scanning, frequency
 response analysis of the transformers and reactor''s etc.
 
 With rapid increase in asset base of your Company, urgent need was felt
 to provide expert handling to the equipment spread all across the
 Country. In view of this, National Transmission Asset Management Centre
 (NTAMC) has been established for remote operation and monitoring of the
 substations, which is manned by experts on 24X7 basis to provide expert
 handling to system & equipment. The project constitutes of three
 distinct areas such as SCADA (Supervisory Control and Data Acquisition
 System), for gathering of electrical data & control of the switchgear
 of sub-station, RAS (Remote Accessibility System) and VMS (Video
 Monitoring System) which can be remotely controlled from the NTAMC and
 which is used to keep a close watch on the substation switch yard & its
 premises.
 
 At the end of FY 2014-15, 75 substations are being operated through
 remote operation including 44 substations without operating staff. MSH
 (Maintenance Service Hub) facility has been established where
 specialised group of experts of all areas like control & protection,
 switchyard equipment, transformer & reactor are available to carry out
 repair/overhauling of equipment as & when required.
 
 International Benchmarking of POWERGRID O&M practices
 
 In order to improve further, POWERGRID O&M practices are regularly
 being benchmarked internationally through International Transmission
 Operation and Maintenance Study (ITOMS) carried out by UMS, USA. In
 ITOMS studies/ benchmarking, about 28 large Power Transmission
 Utilities across the Globe participate and their performances are
 evaluated and benchmarked. POWERGRID carried out benchmarking of all
 its 9 Regions with each other and with other member Utilities of ITOMS
 to identify areas of improvement. As per ITOMS benchmarking, your
 Company has been maintaining high performance in its sub-stations &
 transmission lines operations.
 
 Disaster Management
 
 Being a sound customer centric organisation, your Company has been
 contributing in restoration of power in areas hit by natural calamities
 in the Country. This was evident when the State of Jammu & Kashmir
 (J&K) saw the devastating flood in its history of last 60 years,
 disrupting the electricity supply in most of the areas of the State.
 For quick restoration of power in the State, your Company took charge
 as Nodal Agency to assist J&K Power Department by taking immediate
 measures such as deployment of manpower, tools & tackles for
 restoration of flood affected distribution system, diversion of the
 material to J&K from far-flung States, deployment of Emergency
 Restoration System (ERS), quick procurement of Distribution
 Transformers, etc.
 
 Yet again, when unseasonal torrential rainfall caused flood like
 situation in the State of J&K, landslides were reported at various
 places and tower collapse was reported in 132 kV Salal-Jammu
 transmission line. Immediate dispatch of ERS was arranged and erection
 carried out in a very short time.
 
 Similarly in Andhra Pradesh in October, 2014, after cyclone ''HUDHUD'',
 support was provided to restore power in the affected areas of three
 (3) districts, namely Vishakhapatnam, Srikakulam & Vijayanagaram.
 Wide-spread damage in these three districts had taken place on account
 of tripping of lines connecting to the area from Khammam, Vijayawada,
 Vemagiri, in AP and 400kV in feed from Jeypore ( Odisha).
 Approximately, 1000MW load had crashed due to failure of downstream
 sub-transmission & distribution network of AP Transco & Discoms in
 above three districts. Besides, towers collapse was reported in a
 number of 400KV & 220KV transmission lines in the area and number of
 bay equipment at 400kV Gazuwaka (POWERGPJD), Simhadri (NTPC) & Kalpaka
 (APTRANSCO) were also damaged. A team comprising senior officials was
 sent to site immediately to restore the damaged system. Restoration of
 distribution system was also carried out.
 
 Your Company''s actions have been lauded by everyone including media and
 Government, which has further boosted the determination to be ready to
 face such calamities.
 
 PROJECT IMPLEMENTATION
 
 Your Company has been putting continuous thrust on commissioning of its
 transmission projects to extract maximum commercial benefits through
 its Integrated Project Management and Control System (IPMCS).
 
 On project implementation front, your Company has commissioned about
 8,830 ckm of EHV (Extra High Voltage) transmission lines and 25,786 MVA
 transformation capacity with 8 new sub-stations during the year, which
 includes a number of large projects, including important elements such
 as 765 kV D/C Wardha-Aurangabad lines 1 & 2, 765 kV D/C Raipur-Wardha &
 765kV Champa-Raipur lines for evacuation of power from IPP Projects in
 Chhattisgarh, 765 kV D/C Nellore-Kurnool, 765kV D/C Kurnool-Thiruvalam
 for Southern Region Grid Strengthening, 765kV S/C Satna-Gwalior-II &
 765kV 2xS/C Angul-Jharsuguda transmission lines. Also, through
 commissioning of 765kV D/C Jharsuguda- Dharamjaygarh line, 4,200 MW
 inter-regional power transfer capacity has been added by your Company.
 
 Also, your company has provided active support in the completion of
 critical 765kV Raichur-Solapur circuit-2 transmission line, which was
 being implemented through Private Sector participation.
 
 FINANCIAL MANAGEMENT
 
 In the FY 2014-15, your Company continued to show exceptional
 performance in all its business areas, enhancing the value for the
 shareholders.  Your Company has achieved turnover of Rs. 17,780 Crore
 and Profit after Tax (PAT) of Rs. 4,979 Crore as compared to Rs. 15,721
 Crore and Rs. 4,497 Crore respectively during FY 2013-14 on standalone
 basis.
 
 On consolidated basis, PAT crossed the Rs. 5000 crore mark, registering
 at Rs. 5046 crore in FY 2014-15. The turnover on consolidated basis
 increased to Rs. 18233 crore from Rs. 16146 crore in FY 2013-14.
 
 Capital Investment and Fund Mobilization
 
 In line with its increased target of Rs. 1,10,000 Crore from Rs.
 1,00,000 crore capital expenditure target for the XII Plan, Capital
 investment (CAPEX) of Rs. 22,456 Crore has been made during the year
 2014-15 and cumulatively Rs. 65,651 Crore CAPEX has been achieved. For
 the CAPEX of FY 2014- 15, Rs. 13,014 Crore were mobilised through
 private placement of bonds & term loan, Rs. 3,070 Crore were mobilised
 through External Commercial Borrowings (ECB)/Suppler credit and balance
 Rs.6372 crore was met through internal resources generated & FPO
 proceeds.
 
 Dividend Payout
 
 For FY 2014-15, your Company has proposed a final dividend of Rs. 1.31
 per share in addition to Rs.  0.69 per share of interim dividend paid
 in March, 2015. The final dividend shall be paid after your approval at
 the Annual General Meeting. Thus, the total dividend payout for the
 year amounts to Rs. 1,046 Crore (including an interim dividend of Rs.
 361 Crore).
 
 Particulars of loans, Guarantees or investments.
 
 Loans, Guarantees or investments under Section 186 of the Companies
 Act, 2013 form part of the notes to the financial statements provided
 in this Annual report.
 
 Particulars of contracts or arrangements with related parties
 
 Particulars of contracts or arrangements with related parties referred
 to in Section 188 (1) of the Companies Act, 2013, in the prescribed
 Form AOC-2, are given as Annexure X of the Directors'' Report. Further,
 attention of the members is drawn on Note No. 2.47 of the Financial
 Statement which sets out related party disclosure.
 
 Transfer to Reserves
 
 Your company has proposed to transfer Rs. 2400.00 crore to the general
 reserve and an amount Rs. 1763.00 crore to other reserves.
 
 Statement containing salient features of financial statements of
 subsidiaries, associate and Joint Ventures Companies
 
 Statement containing salient features of financial statements of
 subsidiaries, associate and Joint Ventures Companies as required under
 Section 129 (3) of the Companies Act, 2013, in the prescribed Form
 AOC-1, is given as Annexure XI to the Director''s Report.
 
 Consolidated Financial Statement
 
 As per the requirements of the Companies Act, 2013, the Audited
 Consolidated Financial Statement is provided in the Annual Report.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 As required u/s 134 (3)(c) & 134 (5) of the Companies Act, 2013, your
 Directors confirm that:
 
 (a) in the preparation of the annual accounts, the applicable
 accounting standards had been followed along with proper explanation
 relating to material departures;
 
 (b) the Directors had selected such Accounting Policies and applied
 them consistently and made judgments and estimates that are reasonable
 and prudent so as to give a true and fair view of the state of affairs
 of the company at the end of the financial year and of the profit of
 the Company for that period;
 
 (c) the Directors had taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of this Act for safeguarding the assets of the Company and
 for preventing and detecting fraud and other irregularities;
 
 (d) the Directors had prepared the Annual Accounts on a going concern
 basis; and
 
 (e) the Directors, had laid down internal financial controls to be
 followed by the Company and that such internal financial controls are
 adequate and were operating effectively.
 
 (f) the directors had devised proper systems to ensure compliance with
 the provisions of all applicable laws and that such systems were
 adequate and operating effectively.
 
 COMMERCIAL PERFORMANCE
 
 As per Central Electrical Regulatory Commission (Sharing of inter-State
 Transmission Charges and Losses) Regulations, 2010, your Company as the
 Central Transmission Utility (CTU) of the Country, has been entrusted
 the responsibility for billing, collection & disbursement of
 transmission charges bills on behalf of all Inter-State Transmission
 System (ISTS) Licensees. In this regard, bills on transmission charges
 are prepared, raised and uploaded on the website portal for Designated
 ISTS Customers (DICs), including the payment details by the customers.
 
 Your Company is fulfilling the assigned responsibilities effectively
 and displayed excellent collection efficiency of 97%.
 
 PERFORMANCE AGAINST COMPETITION
 
 Your Company is able to do well in spite of stiff competition and
 displayed impressive performance under Tariff Based Competitive Bidding
 (TBCB). During the year FY 2014-15, your Company won three out of four
 projects put up for bidding under the TBCB route, namely Transmission
 System Strengthening associated with Vindhyachal-V, Transmission System
 associated with Gadarwara STPS (2X800 MW) of NTPC Part-A and
 Transmission System associated with Gadarwara STPS (2X800 MW) of NTPC
 Part-B. As on 31.3.2015, your Company has won total eight (8) projects
 through TBCB since its participation.
 
 DEVELOPMENT OF NATIONAL GRID
 
 A strong National Grid enables seamless power flow across the regions
 and optimum utilization of resources across the Country. Working in
 this direction, your Company successfully achieved ''One Nation-One
 Grid-One Frequency'' in the year 2013-14. During the year under
 consideration, the Company commissioned 765kV D/c
 Jharsuguda-Dharamjaygarh transmission line, increasing the power
 transfer capacity between Eastern Region and Western Region by 4,200MW.
 As a result, the total inter-regional power transfer capacity of the
 National Grid stands at 46,450 MW as on March 31, 2015. Also to
 increase the inter-regional power transfer capacity of the National
 Grid, your Company is executing a number of projects, some of which
 include high capacity HVDC links. By the end of XII Five Year Plan, it
 is expected that the inter-regional power transfer capacity of the
 National Grid will be about 72,250 MW.
 
 GRID MANAGEMENT AND OPEN ACCESS
 
 Power System Operation Corporation Limited (POSOCO), a fully owned
 subsidiary of your Company, has been managing the national grid
 successfully. POSOCO, through National Load Despatch Centre (NLDC) and
 Regional Load Despatch Centres (RLDCs) has been facilitating transfer
 of power through bilateral and multi-lateral transactions and is
 playing important role for creating vibrant electricity market in the
 Country. POSOCO has been designated as the nodal agency for Renewable
 Energy Certificate (REC) Mechanism, transmission pricing, Short Term
 Open Access (STOA) in transmission, Deviation Settlement Mechanism,
 Power System Development Fund (PSDF) management, etc.
 
 During FY 2014-15, to meet the demands in the Country, about 84.36
 Billion Units (BUs) of inter-regional energy transfer was facilitated,
 across the nation using pan-India inter-regional transmission links.
 
 Under Short Term Open Access (STOA), 12,106 nos. of bilateral
 transactions and 25,942 nos. of collective transaction were approved,
 allowing energy transfer of 52.55 BUs through bilateral transactions
 and 28.38 BUs through collective transactions, totaling up to 38,048
 approved transactions and 80.93 BUs of approved energy in the FY
 2014-15.
 
 Further, your Company, as Central Transmission Utility (CTU), is the
 nodal agency for processing & grant of Connectivity, Long Term Access
 (LTA) and Medium Term Open Access (MTOA) to various applicants. Out of
 209 Connectivity applications for about 2,10,000 MW capacity received,
 Connectivity was granted to 90 numbers. of eligible applications of
 77,600 MW capacity. As on March 31, 2015, the Company granted LTA to
 201 applications of 152,000 MW capacity. Also based on the transmission
 margins availability, the MTOA was granted to 76 numbers. of
 applications of 5,100 MW capacity.
 
 QUALITY MANAGEMENT
 
 With the present state of economy & financial issues, the manufacturers
 are facing tough competition from indigenous as well as international
 manufacturers. To ensure quality while procuring goods at competitive
 prices, various quality assurance improvement measures have been
 initiated and implemented to get better quality products.
 Process/surveillance audits were carried out to create win-win
 partnership with suppliers and to get better quality products at low
 costs.
 
 With vast geographical spread of work & large number of high capacity
 transmission lines and sub-stations with state-of-Art technology under
 implementation, capacity building is one of the major challenges. In
 this direction, your Company has established its ''POWERGRID Academy of
 Leadership'' at Manesar for capacity building of its staff as well as
 for power sector-domestic & international. Further, to have
 self-reliance of indigenous development of High technology / critical
 products, your Company has mandated its international suppliers to set
 up manufacturing facilities in India in the field of 765kV
 Transformer/Reactors, 800kV HVDC equipment, GIS & major equipment, etc.
 
 Your Company continues to do process audits in the manufacturing units
 of various vendors, sub-vendors & even further below in supply chain to
 achieve the target of zero product inspection. Activities like
 calibration of key testing instruments & their validation were
 undertaken on topmost priority so as to improve quality systems at the
 manufacturer''s works. Quality audits at sites were also undertaken
 during the year for instant feedback and to take appropriate corrective
 action apart from web based feedback system.
 
 In order to ensure quality of product with required technical
 specifications and to meet project completion target, a number of
 activities have been undertaken by your Company like defining proper
 processes for quality manufacturing, quick approval of quality plan of
 various items and smart inspection of materials. For on time issue of
 CIP (Customer Inspection Points) /MICC (Material Inspection Clearance
 Certificate), testing and manufacturing of various critical items,
 continuous follow up with manufacturers were undertaken.
 
 Another milestone was achieved during the year when two of the Regional
 Offices of POWERGPJD, i.e. Nagpur (Western Region-I) & Shillong
 (North-East Region) were awarded certification for their Energy
 Management Systems under ISO 50001.
 
 Your Company developed and maintained systems and procedures aligned
 with integrated management system comprising ISO 9001: 2008 for Quality
 Management System, ISO 14001: 2004 for Environmental Management System
 and OHSAS 18001: 2007 for Occupational Health and Safety Management
 System. The certification has been maintained upon rigorous audits by
 BSI Management Systems.
 
 TECHNOLOGY DEVELOPMENT
 
 Your company gives priority to research and development activities with
 potential for environmental, social and national interests by
 incorporating advanced technology solutions in the field of power
 system. In this direction, your company is setting up State-of-the-Art
 research and testing laboratories POWERGRID Advanced Research and
 Technology Centre at Manesar in the field of transmission, renewable
 integration, power system simulation, material science, advanced
 equipment diagnostics, smart grid, energy efficiency, control and
 automation, engineering design etc. This R&D centre shall cater to the
 research needs of POWERGRID and the country as a whole as well as
 capacity building of various stakeholders in this field.
 
 The focus areas in development of transmission system across the
 country and trans-country as well are conserving the Right of Way
 (RoW), minimizing impact on natural resources, indigenization of
 technology and maintaining high network availability. To address these
 aspects, your company has developed new type of tower design including
 multi circuit type, digital substation through process bus
 architecture, air core reactor suitable for HVDC terminal etc.
 
 Further, your Company as a part of its technology development process
 is carrying out a demonstration project on High Temperature
 Superconductor (HTS) cable system at 220kV voltage level. Being a
 technology in its development and demonstration stage worldwide, which
 is known for bulk power transmission with negligible losses on reduced
 right-of-way, the first-hand experience gained from this R&D project
 will boost your company''s thrust towards adoption of cutting edge
 technologies for safe, secure and reliable operation of grid. The
 operational experience and maintenance know-how gained from the project
 will pave way for future deployment of this state-of-the art technology
 in Indian grid.
 
 Your company is considering a pilot project on Fault Current Limiter.
 The search for a solution to address the issue of rising fault current
 levels in Indian grid and at the same time which doesn''t affect the
 reliable operation of the grid leads your company to advanced fault
 current limiters.  These Fault Current Limiters offer a promising
 solution to tackle the rising fault levels with its unique features in
 comparison to conventional methods for fault current limitation viz.
 bus splitting, series reactors etc.
 
 Towards maintaining high network availability by maintaining proper
 insulation level of EHV transmission line, pollution measurements on
 pan India basis is being carried out to create base line pollution
 mapping data facilitating review of EHV lines insulation requirement
 which is first of its kind in the country.
 
 SMART GRID TECHNOLOGY
 
 Your company has pioneered for development of Smart Grid leading
 towards Smart City in the country for bringing efficiency encompassing
 entire power supply value chain.
 
 Your company is implementing one of the world''s largest Wide Area
 Measurement System(WAMS) through deployment of State-of-the- Art Phasor
 Measurement Units(PMU) as part of Smart transmission. It covers
 deployment of PMUs at all 400kV and above substations at State and
 Central level as well as generation switchyards of 220kV & above across
 the country as part of Unified Real Time Dynamic State
 Measurement(URTDSM) scheme. Real time measured system information using
 fibre optic communication network are to be integrated at State Load
 Despatch Centres(SLDC), Regional Load Despatch Centres (RLDC) and
 National Load Despatch Centre(NLDC) for improved visualization and
 enhanced situational awareness of system operators and planners.
 Analytics using above data are being developed in association with IIT,
 Bombay to enhance the efficiency & security of the overall grid
 management.
 
 Towards smart distribution, after demonstration of various Smart Grid
 attributes at Puducherry in a comprehensive manner through open
 collaboration, your company is also extending services for
 implementation of Smart Grid projects in various states like Himachal
 Pradesh, Punjab, West Bengal, Tripura, Chhattisgarh, Rajasthan,
 Haryana, Karnataka and Puducherry. Your company has also submitted
 project report to Govt.  of Haryana on development of smart grid
 leading towards smart city Gurgaon to provide 24x7 quality power
 including catering growing demand and make Gurgaon Diesel generator set
 free city.
 
 Towards facilitating increasing penetration of renewables in the
 overall generation capacity portfolio, your company has pioneered in
 implementation of battery energy storage systems of about 1 MW capacity
 as pilot project in Puducherry to evaluate different battery and its
 control technologies for proof of concept, areas of application, policy
 advocacy etc. in Indian context for large scale deployment.
 
 Quality of power is one of the major concerns now in India for
 performance improvement of process and maintaining health of electrical
 network equipment. Recognizing its importance, your company has taken
 initiative to measure various power quality parameters at different
 cities on pan India at all voltage level to create base line data
 repository for identification of mitigating measures and application of
 technological solutions.  Already measurements at more than 150
 cities/towns completed across the country.
 
 Your company is indigenously developing/developed smart products like
 smart meter, data concentrator unit, home energy management system,
 micro grid controller, active power filter etc. for varied applications
 and applied for patent.
 
 To bring awareness about Smart Grid technologies and its demonstration
 in a holistic manner, your company is establishing a Smart Grid
 Knowledge Center equipped with working model of various technologies at
 POWERGRID Advance Research and Technology Centre (PART) at Manesar.
 This shall facilitate dissemination of knowledge on smart grid
 technologies in a learning environment as well as capacity building of
 utility/consumer and other stakeholders.
 
 Your company also operates Secretariat of the prestigious India Smart
 Grid Task Force(ISGTF) of Ministry of Power, Govt. of India for
 activities related to Smart Grid.
 
 GRID INTEGRATION OF RENEWABLE ENERGY SOURCES
 
 Integration of Renewable Energy(RE) sources into the grid is one of the
 top priority of Govt. of India towards energy security and
 environmental sustainability. In this direction, your company has
 evolved Green Energy Corridors comprising intra state and inter state
 transmission infrastructure to facilitate integration of envisaged
 renewable capacity addition of about 33 GW in 12th plan in RE resource
 rich states at an estimated cost of about Rs. 38,000 cr. Inter State
 Transmission System(ISTS) as part of Green Energy Corridors is being
 implemented by your company. Further, your company has also evolved
 transmission schemes for integration of proposed ultra mega solar power
 parks of about 22,000MW in various states as part of Green Energy
 Corridors-II. Govt. of India also assigned your company to develop
 Inter State transmission system for nine(9) solar parks of capacity
 about 10,000 MW in seven(7) states. Implementation of transmission
 scheme for one(1) solar park in Andhra Pradesh is under progress.
 
 ENERGY EFFICIENCY
 
 Energy conservation through energy efficiency measures plays an
 important role to address energy saving aspect towards sustainability.
 Your company initiated activities in identification of energy saving
 opportunities through carrying out energy audits of various industries
 including Integrated Steel Plant at Bokaro & Bhilai, SAIL, institutions
 and other commercial establishments. Your company has more than 70
 Bureau of Energy Efficiency (BEE) certified Energy Auditors/Managers.
 So far through energy audits, energy saving potential equivalent to
 4750 MU with avoidable generation of about 900MW has been identified
 besides reduction in C02 emission. Towards demand side management, your
 company replaced 1337 old agricultural pumps with energy efficient
 pumps in Mandya district, Karnataka resulted into energy saving more
 than 35% with about 3MW load reduction.
 
 Your company is also a BEE Grade-I Energy Service Company (ESCO) to
 implement energy efficiency solutions. In-house designed Waste heat
 recovery systems for steel re-rolling mills and implemented at various
 industries.
 
 Your Company has released a study report Negawatt Makes-a-Watt i.e,
 Energy efficiency opportunities in India covering eighteen(18) energy
 intensive sectors in the country. Savings more than 20% in electrical
 energy, 12% in Coal and 7% in oil can be achieved per annum at an
 investment of Rs.12 lakh crore over a period of 5 years.
 
 ''POWERTEL'' - TELECOM SERVICES ON TRANSMISSION INFRASTUCTURE
 
 Your Company is leveraging its Country wide transmission infrastructure
 with its diversified business portfolio of Telecom under the brand name
 ''POWERTEL''. During the FY 2014-15, total network coverage has been
 increased by 12% to 33,241 kms from the earlier reach of 29,641 kms.
 Number of Points of Presence (PoPs) locations have been increased to
 352 from the earlier coverage of 317 PoPs and 44 new customers were
 added, resulting in increase in total customer base to 187 numbers and
 a growth of 25% over previous year.
 
 Telecom Backbone Availability for the year 2014-15 was 99.97% better
 than in the previous year. Total Revenue (including revenue from
 internal sources) from Telecom Business for FY 2014-15 was Rs. 300.95
 Crore as against Rs. 288.21 Crore in the previous year.
 
 Your Company has signed an agreement with Bharat Sanchar Nigam Limited
 (BSNL) to improve the telecommunication connectivity with the
 North-Eastern States including Sikkim. It envisages the provisioning of
 bandwidth on optical fibre media laid over existing high tension
 electric transmission network of your Company. After completion of the
 proposed connectivity, the reliability of the telecom services shall
 improve substantially in North-Eastern region including Sikkim. Your
 Company has successfully completed the prestigious NKN (National
 Knowledge Network) project assigned by Govt. of India, which connects
 all knowledge centres across the Country such as Indian Institutes of
 Technology (IITs), Indian Institute of Sciences (IISCs) etc., on a high
 speed connectivity.
 
 National Optical Fibre Network (NOFN)
 
 As a part of Government of India plan to connect 250,000 Gram
 Panchayats (GP) in the Country by utilizing existing fibres of PSUs
 (BSNL, Railtel and POWERGRID) and laying incremental fibre to connect
 to Gram Panchayats wherever necessary, Your Company has been allotted
 work for development & maintenance of NOFN network in States viz.
 Telangana, Himachal Pradesh, Jharkhand & Odisha by Bharat Broadband
 Network Ltd (BBNL). Survey work has been completed in all states.
 Awards have been placed progressively for supply of duct & accessories
 and trenching & laying work. 977 nos of Gram Panchayats have been
 connected with fibre till 31st March 2015.
 
 BUSINESS DEVELOPMENT & CONSULTANCY
 
 Your Company, one among the largest power transmission utility in the
 world, has developed the expertise in its core areas such as power
 transmission, sub-transmission, load dispatch and communications (LD&C)
 etc.
 
 Leveraging its capacity and experience, Consulting services have been
 provided to a number of customers in India and worldwide. During FY
 2014-15, forty (40) Consultancy assignments were secured. During the
 fiscal 2015, the Company achieved Consultancy Revenue ofRs. 381 Crore
 from Consulting services.
 
 DOMESTIC
 
 Keeping its commitment to assist State Utilities for an inclusive,
 healthy and sustainable growth, your Company undertook a number of
 assignments on behalf of Utilities and other clients covering areas of
 Transmission, Sub-transmission, Distribution, Load Dispatch &
 Telecommunication, Smart Grid application, Energy Efficiency, HR
 Management and Development etc. Major Assignments include Comprehensive
 Scheme for Strengthening of Transmission & Distribution System in
 Arunachal Pradesh & Sikkim (Estimated project cost of Rs. 4209 Crore),
 Strengthening of 400 kV & 220 kV Transmission System of Delhi Transco
 Ltd (Estimated project cost of Rs. 932 Crore) and Srinagar - Leh
 Transmission System (Estimated project Cost ofRs. 1788.41 Crore).
 
 In order to expand consultancy market even farther, exploratory forays
 are being persistently charted out in Oil sector, Railways, Industrial
 Corridors, etc. which are likely to bear fruit in near future.
 
 Some of the engagements in green-shoot areas like Smart Grid /
 Non-conventional Renewable Energy and Energy Efficiency initiated by
 the Company also have potential opportunities to contribute towards
 income from consulting services.
 
 INTERNATIONAL
 
 Your Company secured a total of 10 assignments with consulting fee of
 about Rs. 3,700 Lakhs during FY 2014-15, in international arena. Your
 Company has now international presence in a number of countries of
 Asia, Africa & Eurasia regions. Countries in which consulting services
 are being provided include in Afghanistan, Bangladesh, Bhutan, Congo,
 Ethiopia, Nigeria, Nepal, Kazakhstan, Kenya, Kyrgyz Republic, Myanmar,
 Senegal, Tajikistan, Tanzania, Uzbekistan etc.
 
 During the FY 2014-15, your Company successfully completed the contract
 worth USD 64.01 million awarded by Myanmar Electric Power Enterprise
 (MEPE), within time schedule, for supply of Goods and related Services
 for 230kV Transmission System associated with Thahtay Chaung Hydro
 Power Project in Myanmar.
 
 INTERNATIONAL COOPERATION
 
 The proposed cross-country grid is being envisaged for harnessing SAARC
 nations'' capacities and resources to address growing energy needs of
 the region. Presently, India has interconnections with Nepal, Bhutan
 and Bangladesh, which are being strengthened for mutual exchange of
 power. With these interconnections, while the county imports around
 1,500 Megawatt (MW) of power from Bhutan, it exports around 500 MW
 power to Bangladesh and 150 MW power to Nepal.
 
 Further, for evacuation of power from various upcoming hydroelectric
 power projects(HEPs) in Bhutan, Punatsangchu-I HEP (Bhutan) -
 Alipurduar (India) 400kV Double Circuit (D/c) line between countries
 Bhutan & India, is under implementation and expected to be ready by
 2017. Also, for transfer of bulk power, interconnection between India
 and Nepal through 400 kV Dhalkebar (Nepal) - Muzaffarpur (India) D/c
 transmission line is under implementation. Further, to augment the
 power transfer capacity of India - Bangladesh asynchronous
 interconnection through 400kV (charged at 132kV) Surajyamaninagar
 (India) - Comilla (South) (Bangladesh) line, addition of another 500MW
 power terminal module at Bheramara is being firmed up, which will
 increase the power transfer capability between the two nations by
 500MW. For interconnection between India and Sri Lanka through a
 ±400kV, 500/1000MW under-sea HVDC line, feasibility studies carried out
 and reports under review. Discussion for interconnection between India
 and Pakistan through Amritsar (India) - Lahore (Pakistan) line are
 being held at Government level.
 
 CONTRIBUTION IN DISTRIBUTION REFORMS
 
 Under DDUGJY (Deendayal Upadhyaya Gram Jyoti Yojana) scheme (including
 erstwhile RGGVY) for rural electricity infrastructure and household
 electrification, your Company has been executing infrastructure work
 for rural electrification in sixty-seven (67) districts of nine (9)
 States in the Country of a base cost of about Rs. 7,409 Crore.
 
 Almost all of the X / XI plans schemes have been completed. Work in 4
 districts in Uttar Pradesh (UP) assigned to POWERGRID under XI Plan
 Phase-II and XII Plan are under implementation.
 
 During FY 2014-15, infrastructure was created for electrification in
 581 nos. of partially electrified villages. Also, 2666 nos. of villages
 were energised. Cumulatively, till March, 2015, infrastructure has been
 created for electrification of 71,622 villages. Further, service
 connections were provided to about 35.9 lakh BPL households.
 
 For rural electrification under DDUGJY, your Company has been engaged
 for execution of projects under the XII Plan in 15 districts of Odisha
 having sanction cost of about Rs. 1767 Crore and earning potential
 ofRs. 159 Crore.
 
 XII PLAN PROGRAMME
 
 The Capex plan of your Company has been increased to Rs. 1,10,000 Crore
 from Rs. 1,00,000 Crore envisaged earlier for XII Plan mainly due to
 additional transmission infrastructure of various inter-State
 transmission systems including Green Energy Corridors projects.
 
 Your Company has already made a capital expenditure of Rs. 65,651 Crore
 in the first three years of the plan period. Based on the ratings given
 by both domestic and international credit agencies, your Company do not
 foresee any difficulty for resource mobilisation. The funding for
 capital expenditure are planned to be met through loans from
 multilateral institutions such as The World Bank, Asian Development
 Bank, Supplier''s Credit, External Commercial Borrowings through bonds /
 notes, besides loans from domestic market and through private placement
 of bonds.
 
 ERP IMPLEMENTATION & IT
 
 Project RUPANTAR, the Enterprise Resource Planning (ERP) initiative
 of your Company has been implemented successfully in the year 2014-15.
 
 Subsequent to completion of the User Acceptance Testing of the business
 solutions, pilot Go-live of ERP took place in August 2014. After the
 stabilization of the pilot region, roll out to balance regions was also
 taken up and completed during October 2014 to February 2015. Presently,
 majority of the key processes related to the business are running on
 ERP. Also, a Disaster Recovery Site is being established at Bangalore.
 
 Your Company continues to provide latest IT solutions for betterment of
 its business process. Both Internet and Intranet have been provided in
 offices and site locations all over the Country for seamless
 connectivity and effective working environment. Recruitment process is
 being conducted for self and for few other companies through online
 application portal, which is designed, developed and maintained through
 in-house expertise. Further, various applications like online status of
 Swachh Bharat Abhiyaan (Clean India Mission) works, Inspection
 Management System, Vigilance Inspection System and Attendance
 Management System etc. are developed, run and maintained in-house for
 assisting the business operations.
 
 The Company has also taken up a major technology upgradation of IT
 infrastructure such as implementation of cloud, security policy,
 Information Security Management System (ISMS), etc. Further, ISO:27001
 Certification for ISMS is also being implemented initially at Corporate
 Centre.
 
 Your Company has established video conferencing facilities at Corporate
 Centre, all regional Headquarters, all major Project Headquarters as
 well as at most of the substations. Video Conferencing is extensively
 used to carry out meetings, discussions and trainings within and
 outside POWERGRID network.
 
 ENVIRONMENT AND SOCIAL MANAGEMENT
 
 Your Company, since its inception is working to harmonise environment
 conservation with all aspects of its projects. Your Company''s
 activities are non-polluting in nature and their environmental impacts
 are negligible. Your Company is committed to conservation of natural
 resources, reducing impact on nature and increasing the service value
 by use of efficient and safe technology practices.
 
 Key initiatives taken by your Company towards sustainable development
 are technological initiatives for conservation of precious Right of Way
 (ROW), rain water harvesting system which is now an integral part of
 every new substation design, installation of LED bulbs, solar lights,
 fuel catalysts devices for DG sets etc. Your Company has substantially
 reduced the land requirement by utilizing new technology like Gas
 Insulated Substation (GIS) which requires less than one-third (1/3rd)
 of the land compared to conventional Air insulated Substation (AIS). In
 order to reduce Carbon footprint, waste paper are used to produce
 recycled paper for printing of our office stationery like letter heads,
 writing pads, visiting cards, envelopes etc. This has resulted in
 reduction in use/procurement of fresh paper.
 
 For the FY 2014-15 your Company have obtained final forest clearance
 for 29 transmission lines involving 34 forest proposals involving
 diversion of about 1760 hectares and in-principle forest clearance for
 22 transmission lines involving 32 forest proposals for diversion of
 about 1680 hectares. Some of the major lines for which such forest
 clearances are obtained include 765 kV Angul-Jharsuguda, 400 kV D/C
 Dehradun- Abdullapur, 132 kV S/C Tezu-Namsai, 765 kV D/C
 Dharamjaygarh-Jabalpur etc.
 
 CORPORATE SOCIAL RESPONSIBILITY
 
 Corporate Social Responsibility (CSR) is a commitment of your Company
 to its stakeholders to conduct business in an economically, socially
 and environmentally sustainable manner that is transparent and ethical.
 It primarily focuses on inclusive social-economic growth for
 development of marginalized and under-privileged sections of the
 society residing around its areas of operation. With this approach,
 your Company carries out various CSR activities with thrust on Rural
 Development/Infrastructural Development, Livelihood Generation, Health,
 Education, Tree plantation, Environmental, Relief/Restoration during
 National Calamities etc.
 
 During the FY 2014-15, your Company spent Rs. 47.42 Crore on various
 CSR activities, which was 75% higher than amount spent of CSR
 activities during FY 2013-14.
 
 During the year under review, your Company has also participated in the
 Swachh Bharat Abhiyaan by constructing about 10,000 toilets in about
 4,500 Government schools in several states of India. It has also
 undertaken Projects of imparting skill development trainings for
 industry employment/ self - employment to about 7500 youths
 departmentally and in association with National Skill Development
 Corporation (NSDC), National Handicapped Finance and Development
 Corporation (NHFDC), ITCOT etc. Your Company also distributed aids &
 appliances to People with Disabilities in association with ALIMCO and
 arranged Health Check-up camps at 30 locations.
 
 Annual Report on corporate social responsibility (CSR) activities and
 spend of CSR Amount is given at Annexure XII of this Report.
 
 PEOPLE, OUR CORE STRENGTH
 
 Attracting Talent, Nurturing & Development of Human Capital
 
 Employees are main resources for your Organization. During FY 2014-15,
 your Company inducted about 321 personnel at various levels viz.
 Executives, Supervisors & Workmen. Executives recruited through open
 advertisement on all India basis from reputed engineering and
 management institutes. Recruitment of non-executives was carried out
 through employment exchanges and local advertisement at regional level.
 As on March 31, 2015, the total number of employees of your Company
 stood at 9,033.
 
 Your Company''s Human Resource Development (HRD) interventions are
 directed towards learning new competencies and to reinforce good work
 practices & change workplace behaviour as per the organizational needs.
 The Company has been able to link the Individual Development Plans
 (IDP) of employees as per the business requirement, which helps the
 organization to keep updating the competencies of employees to meet
 current and future requirements. In order to align with growing
 competitive business environment, your Company imparted training/ hands
 on training on major equipment and their operation & maintenance, new
 Land Acquisition Act, Certified Project Management Programmes, latest
 survey techniques, networking skills and overhead power line design
 program, etc.
 
 The yearly Action Plan HRD has been based on ''Organisational Need
 Analysis (ONA)'' and Training Needs Assessment (TNA)''. Competency
 Analysis and Skill Gap Analysis have been carried out for various
 functions in your Company by keeping in view the existing/emerging
 business scenario. Skill development programmes in the areas of
 transmission line construction, tower erection & stringing for
 unemployed / under- employed youths have been conducted at various
 locations in the Country and more than 600 such youths were trained
 during FY 2014-15. For conducting such trainings, necessary
 infrastructure has been created in POWERGRID sub-stations.
 Cumulatively, about 1600 persons have been trained up to 31.03.2015
 under this initiative for enhancing the availability of skilled
 manpower for construction jobs in the field of transmission.
 
 In addition, during FY 2014-15, training has been imparted to
 employees/ participants from Haryana Vidyut Prasaran Nigam Ltd.(HVPNL),
 Bhakra Beas Management Board(BBMB), Powergrid Company of Bangladesh
 Ltd.  (PGCB), Kenya Electricity Transmission Company Limited (KETRACO),
 Ceylon Electricity Board, Nepal Electricity Authority, Bhutan Power
 Corporation, Tanzania Electric Supply Company Limited and US Energy
 Association, under consulting services basis.
 
 Employee Welfare
 
 Your Company undertakes requisite changes in various policies from time
 to time in line with the needs and welfare of employees. It has
 empanelled various hospitals nearby to its establishments including
 Corporate Centre for the healthcare of employees and their dependents.
 The issues related to workmen are successfully addressed through the
 National and Regional Bipartite Committee (PNBC/PRBC), a joint
 consultative forum comprising management and workmen representatives.
 
 An effective work culture has been established in the Company through
 empowerment, transparency, decentralization and practice of
 participative management. Industrial relations scenario in the Company
 has been cordial and no man-days were lost in FY 2014-15. Healthy
 community living is spread through periodically conducted cultural
 programmes for celebrating various occasions like Diwali get-together,
 Holi Milan, New Year, Raising Day, etc. in all establishments of the
 Company. Quality food is served to the employees in the ISO 22000:2005
 conferred Cafeteria, Office and Food Lounge of Multi-Purpose hall.
 
 Your Company also conducts various sport competitions for boosting the
 interest of employees in sports and games at intra and inter-regional
 level for Kabaddi, Cricket, Volleyball, and Badminton etc. Your Company
 also participates regularly in Inter-PSU Sports meet and its players
 stood meritorious in Table Tennis, Cricket, Carom, Badminton & Kabaddi
 tournaments and bagged a number of awards.
 
 On the occasion of Silver Jubilee Celebrations a Mini-Marathon was
 organised at Corporate Centre, Gurgaon in which employees including CMD
 & Directors participated with their family members enthusiastically.
 
 Prevention of Sexual Harassment at Workplace
 
 As per the requirement of The Sexual Harassment of Women at Workplace
 (Prevention, Prohibition & Redressal) Act, 2013 (''Act'') and Rules made
 thereunder, your Company has constituted Internal Complaints Committees
 (ICC).
 
 Citizen''s Charter
 
 Citizen''s Charter has been formulated for the Company providing a
 visible front of its vision, mission, objectives, commitments, terms of
 service and its obligation to various stakeholders. In this,
 information is available about Company''s schemes, policies, project
 plans of the corporation and issues of general interest to
 stakeholders.
 
 Implementation of Official Language
 
 Your Company, being sensitive towards our heritage, social and cultural
 concerns, continues to prove its commitment for implementation of
 Official Language Policy of Govt, of India.
 
 Your Company has been encouraging and putting all efforts for promotion
 of usage of ''Hindi'' in all aspects of management in all levels of the
 Corporation. Further, the Company has organized various events such as
 workshops to impart training in translation, enhancing working
 knowledge through organizing computer trainings and Hindi classes, etc.
 for increased use of Official language. Events like Akhil Bhartiya
 Rajbhasha Sammelan, Kavi Sammelans (poetry sessions), Kavita
 Pratiyogita, Hindi plays and various competitions for employees & their
 families are organized. Publication of Hindi magazines and circulation
 of Hindi newspaper to all departments is also being done to encourage
 Hindi writing and reading. To provide further inspiration, employees
 are nominated for external Hindi training programs which further
 educate & encourage the employees to work in Hindi.
 
 Various forums such as Parliamentary Committees on Official Language,
 Advisory Committee on Official Language and Town Official Language
 Implementation Committee (TOLIC) have applauded the efforts made by
 your Company for implementation of Rajbhasha & receiving many
 accolades.
 
 Corporate Image through Communication Management
 
 Communication Management is an important and powerful weapon for
 building a strong corporate brand identity to strengthen and modify its
 relationship with the internal and external stakeholders. Keeping in
 mind the need for sustained, timely and bona fide communication
 interventions, your Company has adopted various communication
 strategies to highlight itself as a major power transmission
 infrastructure giant contributing significantly towards development of
 national economy.
 
 Your Company has been issuing various press communiqué to highlight
 growth, achievements, and developments with a view to maintain regular
 interaction with the public. Your Company organizes ''Quarterly Press &
 Analysts'' Meet'' to facilitate face to face interaction with the
 journalists, analysts and stakeholders which is aimed at winning the
 trust of the masses through imparting information in a transparent way.
 
 To showcase its technologies and strengths, your Company participated
 in the ''India International Trade Fair (IITF) 2014'' and Vibrant
 Gujarat'' targeted towards the common masses and focused clients. Your
 Company also participated in other business oriented exhibitions in
 Mumbai, Delhi and the Country of Tanzania to reach out to the target
 audience for pitching the business.
 
 Communication is not effective unless and until it reaches out to the
 employees who are the pillar of any organization. To achieve this, your
 Company deploys various internal communication tools such as monthly
 newsletters, house journals, wall magazines, lounge and regular media
 updates. Beside this, Company regularly organizes open house for face
 to face interaction between management and employees. Company has
 prepared a corporate movie to showcase its journey on the occasion of
 Silver Jubilee year. A motivated theme song was also prepared for the
 employees. All these communication tools have helped individual in
 gaining an understanding about the organization''s culture & function
 and making them a brand ambassador of the Company.
 
 RIGHT TO INFORMATION
 
 In order to promote transparency and accountability, an appropriate
 mechanism has been set up across your Company in line with ''Right to
 Information Act, 2005''. Your Company has nominated CPIO/ Appellate
 Authorities at its Corporate Office and Regional offices across the
 Country to provide required information to the citizens under the
 provisions of Act.
 
 RENEWED COMMITMENT TO TRANSPARENCY & VIGILANCE FUNCTION
 
 Vigilance Department of your Company performs Preventive, Pro-active as
 well as Punitive Vigilance. However, the emphasis has been shifted from
 Punitive Vigilance to Preventive and Pro-active Vigilance. Your
 Company has taken a number of initiatives to inculcate good governance
 within the organization. Some of these initiatives are given hereunder:
 
 Process (Online) Inspection
 
 Using this technique, inspections are planned in such a manner that
 critical pre-award and post-award activities are inspected during
 execution of works. Process (On-line) Inspection is done in order to
 check whether there are any shortcomings or not, thereby providing an
 opportunity for rectification of the defects before the work is
 completed. Since the focus is more on prevention, critical observations
 made during such inspections help the management in preventing similar
 irregularities during the later stages of execution of the projects.
 
 Web Based Vigilance Information Network System (VINS)
 
 With a view to leverage Technology in our work, Vigilance Information
 Network System (VINS) has been devised by your Company in collaboration
 with the IT Department, which has significantly cut down time, efforts
 and cost of working resulting into higher efficiency.
 
 Workshop on Ethics & Values
 
 Every year, two (2) workshops on Ethics & Values are conducted by the
 Regional Vigilance Department as well as Corporate Centre. These are
 aimed at encouraging value based ethical decision by the employees.
 Further, Preventive Vigilance Workshops are also conducted by Vigilance
 Department for non-vigilance executives. With a view to create
 awareness among the employees, RTI workshops are organized by Corporate
 as well as Regional Vigilance Department.
 
 Vigilance Awareness Week 2014
 
 Vigilance Awareness Week was observed in POWERGRID from October 27,
 2014 to November 1, 2014. In keeping with the theme ''Combating
 Corruption- Technology as an Enabler'', various competitions were
 organized for the employees as well as for their family members, talk
 on ethics & values and on anti-corruption topics were delivered by
 eminent personalities. The week concluded with the release of in-house
 journal of the Vigilance Department ''Candour'' by Shri Pratyush Sinha,
 former Central Vigilance Commissioner.
 
 ACCOLADES & AWARDS
 
 The excellent performance of your Company has been recognised and
 appreciated by the Govt. of India and other prestigious organisations &
 institutions in form of various awards/ accolades in various categories
 from time to time.
 
 Your Company has been rated ''Excellent'' for its performance as per MoU
 2013-14 signed with the Ministry of Power and based on its performance
 poised to get ''Excellent rating'' for MoU 2014-15 as well.
 
 Your Company has been conferred with the prestigious ICSI National
 Award for Excellence in Corporate Governance for 2014 by Institute of
 Company Secretaries of India (ICSI) in recognition of the highest
 levels of transparency and governance practices adopted by the Company.
 
 Your Company proved its mettle on global front by positioning itself in
 the Forbes List of Global 2000 Largest and Most Powerful Public
 Companies, and also fastest growing electric utility in the world as
 per M/s Platts (a division of McGraw-Hill Companies).
 
 The Economic Times at its Power Focus 2nd Annual Summit awarded your
 Company for its remarkable contribution in the Power Sector.
 
 Your Company has been conferred with CBIP Award for the best
 performing Transmission Utility and your CMD has been felicitated with
 the Power Persona of The Year Award by CBIP in recognition of his
 contribution for accelerated development of power sector.
 
 Your CMD has also been bestowed the prestigious IEF Meritorious Energy
 Service Award
 
 Director (Finance) of your Company, Shri R. T. Agarwal, has been
 felicitated with the CA-CFO-Power Sector Award by the Institute of
 Chartered Accountants of India in recognition of exceptional
 performance as CA-CFO in Power Sector for the Year 2014.
 
 MANAGEMENT DISCUSSION AND ANALYSIS
 
 In addition to the issues in the Directors'' Report, some issues have
 been brought out in report on Management Discussion and Analysis placed
 at Annexure-I.
 
 BUSINESS RESPONSIBILITY REPORT
 
 The Business Responsibility Report as stipulated under Clause 55 of the
 Listing Agreement with the Stock Exchanges is given in Annexure-II.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNINGS AND OUTGO
 
 As per requirements of disclosures under Section 134(3) (m) of
 Companies Act,2013 read with Rule 8 of The Companies (Accounts) Rules,
 2014 information relating to conversation of energy, technology
 absorption and foreign exchange earnings and outgo, is given in
 Annexure-III to this Report.
 
 Auditors'' Report
 
 The qualification in Statutory Auditors'' report and managements reply
 thereto is given at Annexure - IV to this Report.
 
 COMPTROLLER AND AUDITOR GENERAL''S COMMENTS
 
 Company has received ''NIL'' comments on the standalone accounts for the
 year ended March 31, 2015 by the Comptroller and Auditor General of
 India under Section 143(5) of the Companies Act, 2013. C&AG comments on
 the consolidated accounts and management''s reply thereto are attached
 as Annexure-V to this Report.
 
 Performance Audit
 
 The Performance Audit has been conducted by C&AG to assess the
 effectiveness of ''Planning & Implementation of transmission projects by
 POWERGRID during XI Plan (2007-2015) and Grid Management by POSOCO.''
 The Performance Audit report was placed before the Committee on Public
 Undertakings in August, 2015. The points forwarded by the Committee in
 the said report have been duly replied by the management.
 
 Composition of the Board
 
 Your Company''s composition of Board of Directors underwent some changes
 during the year 2014-15. Shri Santosh Saraf and Smt. Rita Sinha,
 non-official part time directors ceased to be Directors on the Board of
 the Company w.e.f. December 27, 2014. The Board wishes to place on
 record its deep appreciation and gratitude for the significant
 contribution and support to the Company extended by them during their
 tenure as Directors of the Company.
 
 As on 31st March, 2015, the Board comprised Twelve Directors out of
 which five were whole-time Directors including the Chairman & Managing
 Director, two Government nominees and five Independent Directors.
 
 In accordance with the provisions of Section 160 of the Companies Act,
 2013 read with Article 31 (iii) of the Articles of Association of the
 Company, Shri Ravi P. Singh, Director (Personnel) and Shri R.P. Sasmal,
 Director (Operations) shall retire by rotation at the Annual General
 Meeting of your Company and being eligible, offer themselves for
 re-appointment.
 
 Number of meetings of the Board
 
 The details of number of Board / Committee meetings held during the
 year are provided in the Report on Corporate Governance, which forms
 part of this report.
 
 Declaration by Independent Directors:
 
 All the Independent Directors have met the requirements specified under
 Section 149 (6) of the Companies Act, 2013 regarding holding the
 position of ''Independent Director'' and necessary declaration from each
 Independent Director under Section 149 (7) has been received.
 
 Performance Evaluation of Directors:
 
 The requirement of performance evaluation of directors under Section
 178(2) of the Companies Act, 2013 has been done away with for
 Government Companies vide Ministry of Corporate Affairs'' Notification
 dt. 5th June, 2015. The Independent Directors in their separate meeting
 has reviewed the work assigned to them under Schedule IV of the
 Companies Act, 2013, including performance evaluation of Directors and
 the Board.
 
 Further, the appointment, tenure and remuneration of Directors is
 decided by the President of India. Remuneration paid to Chairman &
 Managing Director and Functional Directors are as per terms and
 conditions determined by the Department of Public Enterprises, Govt. of
 India. Independent Directors are paid only sitting fee per Board /
 Committee meeting attended. POWERGRID enters into Memorandum of
 Understanding (Moll) with Ministry of Power every year wherein Company
 is evaluated on various financial and non-financial parameters.
 
 Secretarial Audit
 
 M/s Chandrasekaran & Associates, Practising Company Secretary has
 conducted Secretarial Audit of the Company for the financial year ended
 March 31, 2015 from. The Report forms part of this Annual Report at
 Annexure-VI.
 
 The Secretarial Auditor in his report has made the following
 observations:
 
 During the period under review the Company has generally complied with
 the provisions of the Act, Rules, Regulations, Guidelines, Standards,
 etc. mentioned above subject to the following observations:
 
 1.  The Company has complied with the provisions of Section 149 of the
 Companies Act 2013 and clause 49 of Listing Agreement except with
 respect to the requirement of appointment of minimum number of
 Independent Directors since 27.12.2014.
 
 2.  The Company has not filed certain e-forms relating to creation of
 charges with the office of the Registrar of Companies where the
 Permanent Account Number (PAN) of the lenders are not available, which
 is mandatory.
 
 Further, the explanation given by the Board on the observation given by
 the Secretarial Auditor are as under;
 
 1.  POWERGRID, being a Govt. Company within the meaning of Section 2
 (45) of the Companies Act, 2013, the power to appoint Directors vests
 with the President of India. The matter has already been taken up with
 administrative ministry for filling two existing vacancies of
 Independent Directors on the Board of POWERGRID.
 
 2.  POWERGRID could not file certain e-forms relating to charges in
 MCA21, wherein the Lenders are Multilateral Agencies-World Bank, ADB
 and IFC for non-availability of PAN of these Agencies. PAN is a
 mandatory fill under e-filing in MCA-21.
 
 Extract of Annual Return
 
 In accordance with Section 134 (3) (a) of the Companies Act, 2013, the
 extract of the annual return in the prescribed format in MGT-9 is given
 as Annexure VII of this Report.
 
 Committees of the Board
 
 The Company has Audit Committee, CSR Committee and other Committees in
 place. The composition and scope of the Committees are provided in the
 Report on Corporate Governance.
 
 A report on the Corporate Governance (Annexure-VIII), forming part of
 this report, together with the Certificate thereon is given in
 Annexure-IX to this Report.
 
 Risk Management Policy
 
 A Statement indicating development and implementation of a risk
 management policy of the Company including major elements of risk are
 given in the Management Discussion and Analysis Report at Annexure-I of
 this Report.
 
 STATUTORY AUDITORS OF THE COMPANY
 
 The Statutory Auditors of your Company are appointed by the Comptroller
 & Auditors General of India. M/s S. K. Mehta & Co., M/s Chatterjee &
 Co., and M/s Sagar & Associates were appointed as Joint Statutory
 Auditors for the financial year 2014-15.
 
 COST AUDITORS OF THE COMPANY
 
 Your Company appointed M/s. K. G. Goyal & Associates, Cost Accountants
 and M/s. R. M. Bansal & Co.,Cost Accountants as Cost Auditors for the
 Financial Year (FY) 2014-15 under Section 148 of the Companies Act,
 2013.
 
 The Cost Audit Reports for the FY 2014-15 will be filed with the Cost
 Audit Branch, Ministry of Company Affairs before due date i.e.
 September 27, 2015.
 
 ACKNOWLEDGEMENTS
 
 The Board of Directors, with deep sense of appreciation, acknowledges
 the guidance and co-operation received from Govt. of India,
 particularly Ministry of Power, Ministry of Finance, Ministry of Home
 Affairs, Ministry of External Affairs, Ministry of Statistics and
 Programme Implementation, Ministry of Environment & Forests, Central
 Electricity Regulatory Commission, Appellate Tribunal for Electricity,
 Central Electricity Authority, Department of Public Enterprises,
 Regional Power Committees, and other concerned Govt.
 departments/agencies at the Central and State level as well as from
 Securities and Exchange Board of India, National Stock Exchange of
 India Ltd., and Bombay Stock Exchange Ltd., Mumbai without whose active
 support, the achievements of the Corporation during the year under
 review would not have been possible.
 
 Board''s special appreciation and thanks are to our valued customers,
 State Governments and State power utilities and other clients, who have
 awarded various works on consulting services basis and reposed faith in
 Company''s capability to handle them. The Board also appreciates all its
 the contribution of Contractors, Vendors and Consultants for successful
 implementation of cvarious projects by the Company.
 
 The Directors take this opportunity to thank the Principal Director of
 Commercial Audit and Ex-Officio Member Audit Board-Ill for the
 cooperation during the year. The Directors also acknowledge the
 valuable suggestions and guidance received from the statutory auditors
 during the audit of accounts of the Company for the year under review.
 The Board also records its appreciation to national/ international
 financial institutions/ multilateral Financial Institutions (The World
 Bank & Asian Development Bank)/ Banks/ national (ICRA & CRISIL) &
 international (Standard & Poor and Fitch) credit rating agencies for
 their assistance, continued trust and confidence reposed by them on
 POWERGRID.
 
 On behalf of Board of Directors, I would like to place on record our
 deep appreciation of the dedicated efforts and valuable services
 rendered by the members of the POWERGRID family, in the Company''s
 achievements during the year 2014-15. I would also like to thank the
 Executive team for their strong leadership, the employee unions, for
 their support and all our employees for their commitment to achieve the
 aim to be the world''s premier transmission utility.
 
                         For and on behalf of the Board of Directors
 
                                                        (R. N. Nayak) 
 
                                        Chairman & Managing Director
 
 Place: New Delhi 
 
 Date: 10.08.2015
Source : Dion Global Solutions Limited
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