Development and Financing of Renewable

Energy Projects in India

A Perspective
By
K.S. Popli
Director (Technical)
Indian Renewable Energy Development Agency Limited
New Delhi ( India )
World primary energy consumption
Source: BP Statistical Review of World Energy
World primary energy consumption fell by 1.1% in 2009 first time since 1982
and consumption of coal was the highest since 1970
Proven Oil Reserves
Source: BP Statistical Review of World Energy
Oil reserves in Asia-Pacific Region are the lowest at 3.5% and highest in the
Middle-East at 57%
Proved natural gas reserves
Source: BP Statistical Review of World Energy
Natural Gas reserves in Asia-Pacific Region are only 8.7% with highest
reserves in Middle East at 40%
Proved coal reserves
Source: BP Statistical Review of World Energy
Coal reserves in Asia-Pacific Region is 32%
Installed Power Capacity - India
Hydro
22%
Nuclear
3%
Renewables
11%
Thermal
64%
Total Installed Capacity : 1,71,926 MW
As on February, 2011
Thermal
111325 MW
Hydro
37367 MW
Renewable
18454 MW
Nuclear
4780 MW
GDP Growth : 8%
Energy Growth : 6%
Captive Capacity : 19.5 GW
Per Capita consumption : 730
units
Coal production Coal consumption
Source: BP Statistical Review of World Energy
GDP Growth of 8-9 %
To maintain this growth, we require similar growth in
availability of power
Present power mix dominated by coal based power plants
with over 65% share
It is expected that Coal shall remain the mainstay in Indias
power mix in the coming years
Issues and Challenges
More than 50% ATC losses
Inadequate generation capacity
Inadequate transmission and distribution network
Lower realisation by SEBs.
Therefore, need for reforms in Power Sector brought in by Electricity
Act, 2003
Generation sector de-licensed
Non-discriminatory provision for use of transmission lines and distribution
system
Captive users can access grid through open access
State transmission utilities to charge for open access and include surcharges for
wheeling and cross subsidies
Power Sector suffering from huge inefficiencies
Electricity Act created a new Industry in India i.e., Power Trading
CERCs and SERCs entrusted with the responsibility of promoting
power market
License required for entering into trading business
More than 30 licensed traders and 2 functional power exchanges
Current share of power being traded is 9% of total power generated
Power Market and Power Trading
SERCs to provide suitable measures for grid connectivity to RE
projects
Specify percentage of total consumption from such Renewable
sources in the area of distribution licensee (RPO)
Preferential tariffs to be determined for Renewable energy
technologies on cost-plus approach till the time they can compete
with conventional power
National Electricity Policy & Tariff Policy
Challenge for sustainable growth GHG Emissions
India is 4
th
largest GHG emitter
In the Indian context, 40%
contribution in the emissions is
from the Power Sector (coal based
power plants)
To reduce GHG emissions and
address global concerns on climate
change with the GDP growth,
Government of India announced
the National Action Plan for
Climate Change (NAPCC)
National Action Plan on Climate Change
Outlines Indias strategy to meet the challenge of Climate Change
Eight National Missions, form the core of the National Action Plan,
representing multi-pronged, long term and integrate strategies for
achieving key goals in the context of climate change.
National Solar Mission
National Mission on Enhanced Energy Efficiency
National Mission on Sustainable Habitat
National Water Mission
National Mission for Sustaining the Himalayan Eco-system
National Mission for a Green India
National Mission for Sustainable Agriculture
National Mission on Strategic Knowledge for Climate Change
National Action Plan on Climate Change ( NAPCC )
Thrust on RE in NAPCC
National Action Plan for Climate Change envisages 4%
contribution by Renewable Energy in the Indian power
mix by 2010, to be increased by 1% every year to reach
15% by 2020
This would require cumulative installed RE capacity of
more than 100 GW to meet the 15% RPO target
RE Sector in India: Potential and Achievements
[As on 31.12.2010]
Sector
Appx. Potential
(MW)
Installed Capacity
(MW)
Wind 45195 13065
Small Hydro (upto 25MW) 15000 2850
Bagasse Cogeneration 5000 1494
Biomass 16881 979
Waste to Energy 2700 72
Solar Power -- 17
Total 84776 18477
RE: Potential and Achievements in India
[As on 31.12.2010]
45195
15000
5000
16881
2700
13065
2850
1494
979
72
0
5000
10000
15000
20000
25000
30000
35000
40000
45000
50000
Wind Small Hydro Bagasse Cogen Biomass Waste to Energy
Ranked 4
th
Globally in terms of Installed RE capacity
RE Installed Capacity in India
Sectors 07-08 08-09 09-10 10-11*
Biomass 606 703 866 997
Small Hydro 2180 2430 2735 2939
Wind 8757 10242 11807 13065
Cogeneration 800 1049 1334 1562
W2E 55 59 65 72
Solar - 3 10 18
TOTAL 12398 14486 16817 18654
Annual
Increment 2088 2331 1837
(*) Till Dec 2010
In MW
Ministry MNRE
Financial Institution IREDA
Technical Institutions C-WET, SEC
Comprehensive Resource Assessment
Wind Atlas/ Solar Radiation Mapping/ Hydro Sites
Enabling Legislations
Renewable Power Obligations & Preferential feed-in-tariffs
Fiscal & Financial Incentives
RE Enablers
Wind Sector in India
70% of the installed RE capacity from Wind
5
th
Largest in terms of installed Wind capacity
Over 7500 MW of manufacturing capacity
0
5000
10000
15000
20000
25000
30000
35000
40000
45000
china US Germany Spain India
Wind Installed Capacity (MW)
Wind Resource Assessment started during 1983-84
900 Wind Monitoring Stations
Setting up of Demonstration projects
Starting of Private participation in Power sector
Introduction of fiscal incentives
Indigenous wind turbine manufacturing facilities
Centre for Wind Energy Technology (C-WET)
Gross Potential - 45,000 MW
Wind Program in India
Stages of Wind Growth in India
Wind Capacity Addition
Preferential Tariffs determined on cost-plus basis
Financing at easy terms
Long term repayment at competitive interest rates
Loans upto 70% of project cost
Fiscal incentives
Accelerated Depreciation
Excise duty exemptions, Tax Holiday
Resource assessment by C-WET
Generation Based Incentive
Reasons for Success of Wind
Centre for Wind Energy Technology
To develop & support R&D programs for reliable and cost
effective technology
Preparation of Wind Energy density map, Wind Atlas and
reference wind data
To accord type approval/type certification for Wind Electric
Generators for installation & operation in the Country
Certification of wind data provided by wind monitoring studies
carried out by different Agencies
Consultancy services for feasibility studies, due diligence, micro-
siting & preparation of DPRs through State of Art Software Tools
Other RE Technologies
Biomass
Small Hydro
Cogeneration
0
500
1000
1500
2000
2500
3000
2007-08
2008-09
2009-10
2010-11
Small Hydro
Small entrepreneurs
Non-availability of hydrological data
Hydro development a state subject
Biomass
Fuel availability
Cost of fuel
Competing use
Issues with Hydro & Biomass
Solar Radiation in India
Most parts of India receive good solar radiation 4-7 kWh/sq. m.
Jawaharlal Nehru National Solar Mission
Under the National Action Plan on Climate Change 8 Missions were
proposed. In the Prime Ministers words Solar Mission was its
centerpiece.
National Solar Mission is one of the major global initiatives in
promotion of solar energy technologies.
To deploy solar technologies on a large scale leading to cost reduction
and aiming to achieve grid tariff parity by 2022
Mission Targets
Application Segment Phase - I Phase-II Phase- III
2010-13 2013-17 2017-22
Utility grid power 1,000-2,000 MW 4000-10,000 MW 20,000 MW
Off- grid Applications 200 MW 1,000 MW 2,000 MW
Solar Thermal
Collectors Area
7 million Sqm 15 million Sqm 20 million Sqm
Manufacturing Base -- -- 4,000-5,000 MW
Solar Lighting Systems -- -- 20 million
Solar RPO 0.25% -- 3%
Regulatory Framework
Tariff for purchase of Solar Power
Bundling solar with thermal power
Competitive Bidding to select utility scale power projects
Solar specific purchase obligations beginning with 0.25%.
Interest & Capital Subsidies for Off-Grid Program
Grant support for R&D and technology demonstration
Status of Mission
Small Solar PV Projects up to 2 MW
78 projects aggregating to 100 MW to be commissioned by Dec 2011
Large Solar PV Projects 5 MW each (Total 500 MW)
13 projects aggregating to 54 MW to be commissioned by October 2011.
30 projects aggregating to 150 MW to be commissioned by March 2012.
Remaining 300 MW to be commissioned by March 2013
Large CSP project 500 MW
10 projects of 500 MW to be commissioned by March 2013
Large CSP project 500 MW
10 projects of 500 MW to be commissioned by March 2013
List of Projects:
Entity Capacity (in MW)
Lanco Infratech limited 100
KVK Energy ventures Private Limited 100
Rajasthan Sun Technique Energy Private Limited 100
Megha Engineering and Infrastructures Limited 50
Godawari Power and Ispat Limited 50
Corporate Ispat Alloys Limited 50
Aurum Renewable Energy Private Limited 20
Acme Telepower Limited 10
Dalmia Solar Power Limited 10
Entegra Limited 10
Status of schemes
Technology Usage Patterns in CSP
0
50
100
150
200
250
300
350
400
450
Solar Tower PTC CLFR Dish-stirling
30 MW
410 MW
50 MW
10 MW
Solar Thermal Capacity = 500 MW
Tariff
Tariff notified by CERC
PV INR 17.91/ unit
Thermal INR 15.31/ unit
Tariff discovered after bidding
Solar PV INR 10.95 12.8 /unit
Solar Thermal - INR 10.49 12.24 /unit
State Specific Schemes
States of Gujarat, Rajasthan, Madhya Pradesh, Punjab and Delhi have
announced respective Solar Policies
Gujarat is promoting the installation of 365 MW Solar PV and 351 MW Solar
Thermal projects. Total 34 developers have been shortlisted combined both
for Solar PV and Solar thermal.
Work initiated on Solar Park in Gujarat (Charanka) with following features:
First 500 MW solar power project in Asia
Investment of over US $ 3.5 Billion
3000 acres of land, comprising 1000 acres of government wasteland
Leasing of plots to companies on 30 year contracts.
Arrangements for water, electricity, roads and power transmission
Solar Manufacturing Capacity
Solar PV modules: 1000 MW
Solar Cells: 400 MW
Solar Energy Centre
* Setup in the year 1991
* National test and standardization
Centre for solar energy materials,
components and systems
* Joint collaborative research
* Advisory and Consultancy Services to
industry and users.
* Undertake systems design, engineering
and prototype development.
* Evaluate new and improved
technologies/products/ systems to
assess their adaptability to Indian
conditions.
IREDA A developmental FI for Renewable Energy
Incorporated under the Companies Act on 11th March, 1987 to
promote, develop and extend financial assistance for Renewable Energy
and Energy Efficiency/ Conservation Projects.
Extend financial support to Renewable Energy, Energy Efficiency &
Conservation projects
Operational Areas
Sectors being financed
Hydro Energy
Wind Energy
Bio-Energy
Solar Energy
Energy Efficiency & Energy Conservation
Administration of MNRE Programs
Wind GBI
Rooftop Solar
Solar Off-grid refinance scheme
Cumulative Performance
No of Projects Sanctioned : 1941 Projects
Total Loan Sanctions : 3400 Million US$
Loan Disbursements : 1746 Million US$
Sanctioned Power Capacity : 4280 MW
Commissioned Capacity : 1977 MW
Conventional Fuel Replacement : 1.3 M MTCR/Yr
As on March, 2011
Recent International Partnerships
KfW, Germany(4
th
LoC) : 200 Million
AFD (France) : 70 Million
Lines of Credit in Pipeline
JICA :$ 100 Million
ADB :$ 200 Million
EIB
NIB
Thank you