Partnership to Advance Clean Energy - Deployment (PACE-D) TA Program

Consultation Workshop: Accelerating Solar Energy Deployment inPublic Sector Undertakings

15th September, 2015

Presented byAnurag Mishra, Senior Clean Energy Specialist, USAID/ India

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• U.S. –India bilateral program with the Ministry of Power and the Ministry of New and Renewable Energy

• A 5-Year, $19.5 million Technical Assistance Program

• Three components of the program:

• Energy Efficiency

• Renewable Energy and

• Cleaner Fossil

The PACE-D TA Program aims to facilitate deployment of clean energy technologies via development of enabling environment, institutional capacity building and financing

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Key Achievements

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Key Energy Sector Priorities

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Dec

entr

aliz

ed G

ene

ratio

n

Util

ity S

cale

Solar parks25 GW

Entrepreneur scheme10 GW

Rooftop solar 40 GW

Other Utility scale solar

25 GW

Target Key Achievements

36 PSU’s committed for

19 GW of RE

Solar Parks and Solar Rooftop Programs

Solar PV implementation across the globe has followed two routes – large scale

centralized generation or smaller scale distributed generation

Solar Rooftop

Mainstreaming EE in Corporate Loans

• Solar - fastest-growing generation technology globally - key contributor has been solar rooftop.

• Large markets like U.S. and Germany - added more capacity through rooftop

A number of drivers have been pushing the development of solar

rooftop projects across the globe

Country Solar PV Installed Capacity (GW) Share of Rooftop PV (%)

Germany ~38 ~60%

US ~20 ~40%

Japan ~24 ~35%

Australia ~4 ~80%

Solar Deployment areas/ benefits

Supply gap reduction

Energy security

T&D loss reduction

Stimulate investments

Optimal utilization of infrastructure

Large ground mounted solar projects

√ √ √

Large commercial solar rooftop projects

√ √ √ √ √

Small household based rooftops projects

√ √ √ √ √

Solar rooftop space has seen a number of models emerge – basically based on ownership, metering and types of rooftops

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• India’s solar rooftop market potential ~124 GW

• 13 States have notified Solar Policy’s supporting grid connected rooftop systems

• 19 states/ UTs have notified regulations for net metering/feed-in-tariff mechanisms

• 15% Government subsidy for non-commercial and non-industrial categories

• Accelerated depreciation benefits for industrial and commercial buildings

•  Loans available under Priority Sector Lending

• Provision of bank loans as a part of home loan/ home improvement loan

• Loans for system aggregators from Indian Renewable Energy Development Agency Limited (IREDA) at concessional interest rate (9.9% to 10.75% per annum)

India’s solar rooftop journey has just started and the government is providing various incentives

Policy and Regulation

Program Design

Process Design and Standardization

Financing

Capacity Building

Knowledge Creation

Programmatic approach is working on policy advisory, program and process

design, capacity building of key stakeholders and knowledge creation

Rajasthan and Karnataka

Indian Oil Corporation & IR

BESCOM & JVVNL

(IREDA & TATA Cleantech)

NISE/ BESCOM/ JVVNL

MNRE & GERMI

S. No. Name of PSU Capacity (MW) State Status

1 Coal India 1000 Different states including AP and TG

Planned (Mou with SECI)

2 NTPC 1000 AP, Rajasthan Planned

3 ONGC 1 Goa Planned

4 OIL 5 Rajasthan Commissioned

5 BHEL, PGCIL, SECI, SSL, REIL, SJVNL

4000 Rajasthan Planned

6 BHEL 500 Maharashtra Planned

7 SJVNL, Hindustan Salt

5000 Gujarat Planned

8 Neyvelli Lignite Corporation

20 N/A Implemented

Planned Solar Capacity by PSU

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PACE-D TA Program’s current engagement with Central PSUs

Supporting IOCL in Developing Rooftop Projects at Refineries

Assisted IOCL in receiving allocation of 5 MW capacity.

Site assessment surveys at Barauni, Panipat and Vadodara refineries

Prepared pre-feasibility reports (PFRs)

Detailed site assessment feasibility report (DFR) for Panipat 2+ MW project.

Impact Tenders floated for Barauni (for 1 MW) and Vadodara (for 0.5 MW) Panipat tenders underway

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PACE-D TA Program’s current engagement with Central PSUs

Supporting Indian Railways in Developing 50MW Solar Rooftop Projects under RESCO model

Standard Request for Proposal (RfP) for RESCO based implementation

Standard Power Purchase Agreement (PPA)

Assessment of selected sites to establish rooftop feasibility and evaluating challenges in program implementation

Detailed financial models to understand economics of solar rooftop systems and estimate acceptable range of tariffs

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Future engagement with IOCL and Indian Railways

Supporting IOCL in developing and/or investing in large scale solar projects

PACE-D TA Program is developing a strategy with IOCL for development of large scale solar investments with a focus on : • Defining target size for proposed

project(s)• Prefeasibility assessments and

business model design• Revenue structure/s• Land acquisition and financial

modeling, etc.

IR has a target of increasing its RE share to 10% of its total energy consumption by 2022.

The PACE-D TA Program is assisting the Indian Railways in:• Developing a strategy for

deployment of solar over the next five years

Supporting IR in developing a strategy for deploying 1,000 MW of solar

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Solar Rooftop Evaluation Tool (SRET)

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SRET works by first evaluating broad eligibility, followed by techno-commercial viability and finally risk assessment

The SRET uses three stages for establishing the viability of Solar Rooftop Projects:

1. Screens the eligibility of the rooftop project based on a qualitative checklist

2. Captures and evaluates the technical and commercial parameters of the project

3. Assess the risks and conditions proposed for lending

Step 1: Evaluating Eligibility Step 2: Techno-commercial Assessment

Step 3: Risk Assessment and Financial Appraisal

• Objective: Establish broad viability by assessing key risks

• Qualitative checklist – analysis critical shortcomings which impact viability

• Utilizes key technical, commercial & regulatory parameters

• Objective: Analyze techno-commercial viability of project

• Focus on demand analysis, technical architecture & risks, costing & financing

• Utilizes technical & commercial inputs from applicant & lenders engineer

• Objective: Analyzes risks & financiability of the project/s with basis for a Go/ No Go decision

• Maps key risks associated with the project, evaluates whether appropriate mitigation strategies adopted

Thank You

PACE-D Partners

Design and development of innovative financing

mechanisms

Microfinance Partners

Capacity to design and implement supportive policies

and regulations

Implementation of techno-commercially viable pilots