In spite of the growth in short term open access (OA), the existing OA framework has not been implemented in the same spirit as envisaged in the Act and is thus is yet to realize its full potential, mainly on account of the resistance from DISCOMs. Given the rapidly falling price of wind and solar power, renewable energy (RE) based OA and captive options are likely to pick up in a big way in the coming years. More importantly, considering the unique characteristics of RE generation like intermittency, seasonality etc. coupled with concessional OA charges in some states and provisions like energy banking will bring newer challenges for the OA framework. This report begins with trying to establish the status of renewable energy based OA in few RE-rich states. One of the critical findings from this exercise is that availability of OA data is extremely poor, is spread across multiple sources and thus is a strong hindrance to critical and objective analysis of various policy-regulatory challenges like – roadmap for removal of concessions for renewable energy, impact of banking on DISCOMs etc. There is a dire need for greater public availability of comprehensive data related to OA in general and RE-OA in particular. Falling power prices are quickly rendering most concessions and waivers unnecessary for renewable energy. Hence the report recommends a gradual withdrawal of such concessions to encourage the growth of RE based OA on its own fundamental economic proposition. Finally, given the inherent seasonal and diurnal variation in RE generation, RE based OA is presently quite unviable without some form of banking framework. The report critically analyses a new energy banking framework which appropriately values banked and unbanked energy in monetary terms. Such a banking framework coupled with the forecasting, scheduling and deviation settlement mechanism regulations will address renewable energy’s seasonal and day-ahead variation respectively to a large extent. In effect these two frameworks would largely internalize the cost of RE grid integration, thereby paving the way for further RE capacity addition.
Record lows in price discovery for wind power (Rs. 3.46/kWh) and solar PV (Rs. 2.44/kWh) coupled with the highest ever yearly capacity addition of ~11.3 GW of renewables in 2016-17 have compelled even the most ardent sceptics to sit up and take note of renewable energy. Direct generation prices (in simple per kWh terms) no longer seem to be a hurdle to achieve the 175 GW national renewable energy target. While India has been ranked as one of the top two countries for investments in renewable energy according to a prominent country attractiveness index, several new challenges have emerged.
This report highlights the major sectoral developments in terms of deployment, prices, new policies and regulations since last year. It also analyses the major challenges and raises important questions on the future path for various policy-regulatory instruments for renewable energy as its share is set to rapidly increase. This report is an update to the first report looking at India's journey towards 175 GW renewables, published by Prayas (Energy Group) in October, 2016.
The Government of India has announced a target of 175 GW (100 GW of solar, 60 GW of wind) of renewable power in the country by 2022. Considering this target, the penetration of renewables may reach as high as 33% in terms of capacity and 21% in terms of generation. Operating the grid efficiently, economically and securely with high penetration of intermittent wind and solar generation, especially with concentrated deployment in few states can be additionally challenging.
One of the important steps that the regulatory set-up has been working on is the introduction of forecasting, scheduling and deviation settlement mechanisms for wind and solar generators. While this is an important first step, as the share of RE increases it will crucial to understand its implications on various sectoral stakeholders.
In this context, Prayas (Energy Group) organised a roundtable discussion to deliberate on the various specific challenges around forecasting, scheduling and deviation settlement regulations for renewables and broader RE grid integration aspects. The discussion was carried out under Chathan House rules to enable frank and open discussions. The objective was to understand the different perspectives of various stakeholders (ERCs, Generators, DISCOMs, LDCs, etc.). Our hope was that these deliberations would constructively inform policy and regulatory officials as they work on the important task of framing rules around renewable energy grid integration. The roundtable was attended by 36 people representing a strong diversity of stakeholders including SERCs, DISCOMs, SLDCs, Wind/Solar developers, Consulting, Thermal Generators, Transmission Utilities, Academia, Power Exchanges, Consumer representatives and Forecasting and Scheduling service providers.
NITI Aayog published a Draft National Energy Policy in June 2017 and invited comments. Following are the comments submitted by PEG for the same.
Of the total electricity consumption in year 2014-15 in India, residential and commercial buildings accounted for ~23% and ~8%, respectively. It is likely that there could be ten fold increase in electricity consumption in these segments in the next thirty years. While energy efficiency measures can reduce demand significantly, onsite renewable energy generation can help further reduce energy & electricity bills, dependence on the central electricity grid, reduce transmission and distribution (T&D) losses while generating clean energy at the same time. Direct onsite renewable energy use in buildings has significant potential and forms one of the key blocks within the larger move by India towards greater use of renewable energy.
This report looks at the various onsite renewable energy generation technologies available in India, their policy-regulatory framework and their experience in deployment through various case studies. Supplemented by interaction with various stakeholders in this sector, the report focuses on identifying the opportunities and challenges in realizing the potential of onsite RE generation and use in buildings in India.
The Solar Energy Corporation of India recently discovered a price of Rs 3.46/kWh for 1000 MW of wind power through the competitive bidding route. Buoyed by this success, the Ministry of New and Renewable Energy has released draft competitive bidding guidelines for procuring wind power under section 63 of the Electricity Act, 2003. In response to these guidelines, Prayas (Energy Group) has sent in few comments and suggestions detailed in the submission below.
The full-day event "Reflections on contemporary issues in the electricity sector" consisted of three sessions, with each session focusing on one recent publication from Prayas. The event was well attended with each session having between 20 and 30 participants from across a wide spectrum consisting of regulators, senior bureaucrats, utility representatives, trade union representatives, civil society organisations, consultants, energy and environment researchers and think tanks.
In the first session, PEG presented its report Price of plenty analysing the "surplus" power situation in the country, its causes, implications and possible solutions. The report presentation was followed by remarks from Mr. Anish De (KPMG) as a discussant. This was followed by a robust discussion among participants sharing their perspectives on the topic.
In the second session, discussion revolved around the PEG report In the name of competition which analyses the saga of retail electricity competition in Mumbai. The analysis looks at the history of evolution of retail competition in Mumbai, the roles of various players involved and lessons for future reforms in this direction. Daljit Singh (independent researcher) and Geeta Gouri (former Member, Competition Commission of India) shared their views as discussants, following which participants shared and discussed their ideas on this issue.
The last session was based on a recent book published by PEG reviewing India's electricity sector reforms over the last 25 years. PEG made a presentation on the book titled Many sparks but little light which covers thermal, hydro and renewable generation, electricity distribution and associated fuel sectors of coal and gas. After PEG presented the motivation for the book and its major conclusions, Srinivasa Murthy (former Chair, Karnataka ERC) and Mahesh Rangarajan (Professor, Ashoka University) complimented PEG for publishing the book and shared their thoughts on it. Participants in the session also shared their views on the book as well as the future of the sector.
The event agenda and presentations made at the event can be accessed below.
The recent price bids for utility scale solar PV (Rs 3.3/kWh) and wind power (Rs 3.46/kWh) show that generation price of renewable energy should no longer be a concern while aiming at high shares of renewable energy in the future electricity mix. However this does not automatically mean that renewables will rule in the days to come. The renewable energy sector will increasingly have to confront the mainstream sectoral challenges. An opinion piece describing some of these challenges and potential ways to start addressing them was published in DNA on 11th March 2017.
The year 1991 was an inflection point in the history of modern India. The country embarked upon wide-ranging economic reforms in what came to be known as the Liberalisation, Privatisation and Globalisation or LPG era. The electricity sector — indeed, the entire energy sector — has seen multiple waves of reforms since then. It has been a quarter century since the beginning of the reforms and there are indications that a fresh wave of reforms are in the offing in the electricity sector. Over this period, Prayas (Energy Group) has keenly followed and participated in the reforms process as a proactive, independent organisation offering constructive critique and suggestions to further public interest.
Prayas (Energy Group) has authored a book born out of this unique engagement and understanding of the sector. The book critically examines many of these reforms and the impacts they have had, to understand if they achieved their expected objectives and if they helped in achieving the desirable socio-environmental outcomes. The in-depth analysis over eight chapters covers thermal, hydropower and renewable generation, electricity distribution, and associated fuel sectors of coal and natural gas. We hope that the book contributes to improve the design and implementation of further reforms, so that the sector overcomes its challenges in an equitable and sustainable manner.
The book is dedicated to Girish Sant, founder coordinator of Prayas (Energy Group), who continues to inspire our work.
India has set itself an ambitious renewable energy target of 175 GW by 2022. In spite of the several benefits of renewable energy, such a high target has profound implications for the Indian power sector, especially in the medium term. Hence it is very important for the electricity sector actors to objectively look at the growth of renewables. A lot of data is already available to understand the renewable energy sector, but more granular and comprehensive up-to-date data, publicly accessible in a user friendly manner, can aid better understanding of the renewable energy evolution in the country.
This Renewable Energy Data Portal is Prayas (Energy Group)'s effort to collate important data which is already available in the public domain and organise it in a manner which makes it more amenable for easier public access. Another feature of this effort is the interactive nature of the data portal which allows users to personalize their interaction and compare data across their chosen years/states/segments etc.