Sustainable Energy Development India Success Story...Shriram EPC WinWind Source: CWET Wind – 2/2 ABPS Infrastructure Advisory Private Limited Practical Solutions to Real Life Problems

Sustainable Energy Development – India Success Story

Harnessing Trade for Climate Change Mitigation

Balawant Joshi

Director, ABPS Infrastructure Advisory Private Limited

[email protected], [email protected]

mailto:[email protected]


Practical Solutions to Real Life Problems ABPS Infrastructure Advisory Private Limited

In the Next Ten Minutes…………..

• Renewable Energy Development in India

• Wind Success Story

• Emerging Solar Story


India has abundant Renewable Sources spread across the country

100000

Wind Energy Sources are concentrated in six states in Southern and Western parts of the country.

Good solar energy potential exists in north-western part of the country

Small hydro and large hydro resources are concentrated in northern Himalayan and north-eastern parts

Central, northern and eastern parts of the country are not endowed with rich renewable sources.

Renewable energy resources are spread unevenly across the country.

Solar Small Hydro Wind


India has been Leader in harnessing Renewable Energy

RE installed capacity is approx 12% of total generation capacity (182 GW)

Renewable Energy contributed more than 5% to overall energy generation (811BU) during 2010-11

Large hydro (>25 MW) is not considered in calculation of RE

Including large hydro (38.7 GW), total RE capacity would sum up to 60 GW

Total RE capacity including Large hydro ~ 30% in terms of total generation capacity and 18% of

total consumption

3487

21125

0

5000

10000

15000

20000

25000

MW

More than 6 fold growth in past 10 years

Source : Ministry of New and Renewable Energy


Renewable Development – Resource Vs Achievement

48500*

16000

5000

15384

1700

50000

14989

1083 1779 3153 73 46

0

10000

20000

30000

40000

50000

60000

Wind Biomass Bagasse SHP Waste to Energy

Solar

MW

RE Potential Installed Capacity

Study by FOR suggests capacity addition of 45000MW by FY15 to meet targets envisaged under NAPCC

RE Capacity Addition, as per MNRE, during FY11 was around 3157MW only

Considering present installed capacity of RE 21125 MW, capacity addition of more than 6000MW is required per

annum to achieve 10% NAPCC target


* - Wind Potential has been estimated at 600 GW by LBNL


NAPCC : Focusing Climate Change and RE Development

National Action Plan for Climate Change (NAPCC)

Honorable Prime Minister of India unveiled National Action Plan on Climate Change (NAPCC) on

June 30, 2008.

NAPCC identifies measures that promote India’s development objectives while also yielding co-

benefits for addressing climate change effectively.

NAPCC comprises of eight core “national missions” running through 2017 and will help in bringing

better planning, management and developmental strategies and cleaner technologies

National Solar Mission

National Mission for Enhanced Energy Efficiency

National Mission on Sustainable Habitat National Water Mission

National Mission for Sustaining Himalayan

Ecosystem

National Mission for a Green India

National Mission for Sustainable Agriculture

National Mission on Strategic Knowledge for

Climate Change


NAPCC : Guideline for RE Development

National Action Plan for Climate Change (NAPCC)

At National level for FY 2010, target for RE Purchase may be set at 5% of total grid

purchase, to be increased by 1% each year for 10 years;

SERCs may set higher target than this minimum at any point in time.

Central & State Govts may set up a verification mechanism to ensure that renewable

power is actually procured

Appropriate authorities may issue certificates that procure renewable power in excess

of the national standard. Such certificates may be tradable, to enable utilities falling

short to meet their RPS

Penalties as may be allowed under EA 2003 may be levied, if utilities are still falling

short in RPS


NAPCC has set challenging target for RE Development

• NAPCC target of 5% for RE Procurement in 2010

• Target to increase by 1% each year to reach 15% by 2020

• Separate target for Solar Energy

• Provides for creation of Renewable Energy Certificate Mechanism

This would mean addition of approx 7000MW capacity each year.

Considering that demand

for electricity would

increase to 1700 BU by

2020, it would create

market for 255 BU units

of renewable energy

generation


Policy framework has evolved over last two decades…

14/12/2011 9

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

20000 M

W

Wind Biomass Small Hydro Others

Policy Announcement by Central Government Policy on Hydro Power

Development

Enactment of Electricity Act, 2003

Generation Based Incentive

Emergence of Electricity Regulatory

Commissions

Enactment of National Tariff Policy

CERC RE Tariff Regulations

NAPCC., JNNSM


RE capacity (18 GW) forms ~ 10% of total generation capacity (170 GW) in the country

In energy terms, it constitutes ~ 4% - 5% of total consumption


Renewable Energy policies

RE Policies

Regulatory Policies

Fiscal Incentives

Public Funding

Feed in tariff

Utility Quota Obligation

Renewable Purchase Obligation

Tradable Renewable Energy

Certificate (REC)

Capital Subsidy,

Grant or Rebate

Tax Incentives

Energy Production Payment

Public Investment,

Loans or Grants

Public Competitive Bidding


Wind is dominant source in India’s RE Mix

India has more than 15,000 MW installed wind

capacity

In terms of installed capacity, India ranks fifth

in the world

India has developed strong manufacturing

base for wind turbine generators

India has more than 10 manufacturers with

total manufacturing base of more than

7000MW

Indigenization of over 80% has been achieved.

Country Wind Capacity* (GW)

China 44.7

United States 40.1

Germany 27.2

Spain 20.7

India 14.9

*World Wind Energy Report and MNRE

India has the 5th largest wind capacity in

the World


Wind – 1/2


Turbine Manufacturing Capacity in India

• Top 5 Manufacturers contribute around 90% of the Indian Wind Turbine Market Share.

• Total Wind Turbine Production Capacity in India stands at around 7.5 GW/annum and expected to cross

17 GW/annum by 2012-13 (Source: GWEC-Indian Wind Outlook 2011)

14/12/2011 12

Manufacturer Installed Capacity (MW) for

[2010-11]

Suzlon 954.6

Enercon 503

Gamessa 227

Vestas 215.1

Regen Power 118.5

RRB Energy 99

Global Wind Power 41.15

Pioneer Wincon 32.25

Shriram EPC 31

WinWind 29

Others 98.4

TOTAL 2349 MW

43%

22%

10%

10%

5%

4%

2% 1%

Indian Wind Turbine Market

Suzlon

Enercon

Gamessa

Vestas Wind

Regen Power Tech

RRB Energy

Southern

Pioneer Wincon

Shriram EPC

WinWind

Source: CWET

Wind – 2/2


National Solar Mission

Phase-wise approach to Establish India as a Global Solar Energy Leader

Increase in grid connected capacity through mandatory use of RPO and

favorable Generation Based Incentive (GBI)

To provide favorable conditions for Solar manufacturing capability

Promote programmes for off grid applications

S. No. Application

Segment

Target for Phase 1

(2010-13)

Target for Phase 2

(2013-17)

Target for Phase 3

(2017-22)

1. Solar Collectors 7 million sqm 15 million sqm 20 million sqm

2. Off Grid Solar Applications

200 MW 1000 MW 2000 MW

3. Utility Grid Power (including roof top)

1000 - 2000 MW 4000 - 10000 MW 20000 MW

Solar – 1/6


National Solar Mission (NSM): Batch I Bid Results (Nov. 2010)

14/12/2011 14

Solar PV (150MW) Solar Thermal (470MW)

Cents/kWh Cents/kWh

Benchamark Tariff 38.93 Benchmark Tariff 33.28

Minimum Tariff 23.80 Minimum Tariff 22.80

Maximum Tariff 27.74 Maximum Tariff 26.61

Average Tariff 26.44 Average Tariff 24.96

Average Discount on

Benchmark Tariff 12.50

Average Discount on

Benchmark Tariff 8.32

* 1 $ = Rs 46

Average tariff came down by 32% in SPV Segment.

Average Tariff Came down by 25% in Solar Thermal Segment.

NSM, Phase I Batch I bidding process witnessed an overwhelming response from Solar

Power Project Developers

There were bids worth over 3400 MW (1505 MW SPV + 2911 MW Thermal) as against

proposed capacity of 620 MW (150 MW SPV + 470 MW Thermal)

42 Projects with total capacity of 143 MW have been commissioned till November 24, 2011

Solar – 2/6


National Solar Mission (NSM): Batch II Bid Results (Dec. 2011)

14/12/2011 15

0.00

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16.00

18.00

20.00

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

Discount (Cents/kWh) Tariff (Cents/kWh)

Cents/kWh

Minimum Tariff 14.40

Maximum Tariff 18.06

Wgt. Average Tariff 16.89

Wgt. Average Discount 12.70

26 Projects with aggregate capacity of 345 MW were selected out of 183 bids with aggregate capacity of 2180 MW

Minimum Tariff was as low as 14.40 cents/kWh

Solar – 3/6


Solar Manufacturing Capacity in India

Manufacturing of Solar cells and Solar Modules in India have seen

tremendous growth over the last decade due to increase in domestic demand.

22 25 32 37 45 110

175

400

750

23 36 45 65 80

135

240

1000

1250

0

200

400

600

800

1000

1200

1400

Solar Cells Solar Modules

CAGR (Modules): 56%

Manufacturing Capacity

(MW) CAGR (Cells): 48%

Solar – 4/6


Lead Manufacturers

Manufacturer Manufacturing Capacity (MW)

Wattage (watt) Technology Cell Module

Moser Baer Photovoltaic Ltd Crystlline Si - 170

Thin Film - 50 150

Crystalline - 5-245

Thin Film – 300-400

Mono, Poly, Thin

Film

Indosolar Ltd 160 NA 3-280 Polycrystalline

Tata BP Solar 84 125 3-280 Mono, Poly

Websol Energy Systems 60 NA 5-220 Mono

Lanco Solar* 50 50 3-280 Mono, Poly

TITAN Energy Systems Ltd NA 100 80-280 (Poly)

80-300 (Mono) Mono, Poly

Reliance Solar 30 30 3-280 Mono, Poly

*LANCO Solar is also setting up a 1,250 million tonne (MT) poly-silicon plant and 80 megawatt peak (MWp)

wafering facility in India

** Current (December, 2011) Cell manufacturing capacity is expected at 1000 MW and Module manufacturing

capacity is expected at 1400MW

Solar – 5/6


Domestic Content Requirement

14/12/2011 18

Scheme/Policy Year Capacity (MW) Domestic Content Requirement

National Solar Mission Phase I 2010-13 1000 Yes

Phase I, Batch I 2010 Solar PV: 200

Solar Thermal: 500

(a) SPV: Modules must be manufactured

in India

(b) Solar Thermal: At least 30%

domestic content

(c) PV Modules made from thin film

technologies or concentrator PV cells

may be sourced from any country

Phase I, Batch II 2011 Solar PV: 350

(a) SPV: Cells and Modules must be

manufactured in India

(b) PV Modules made from thin film

technologies or concentrator PV cells

may be sourced from any country

Gujarat State Solar Policy 2009 1000 NA

Rajasthan State Solar Policy 2011 Phase I: 550 (SPV + Solar

Thermal) NA

Karnataka State Solar Policy 2011 Solar PV: 50

Solar Thermal: 30 NA

Solar – 6/6

According to industry sources, silicon and thin film technologies have approximately equal share in total capacity of 143 MW.


Conclusion

India has achieved significant amount of renewable energy capacity addition during

last ten years, wind has been success story.

While achieving capacity addition, careful balance has been maintained with

manufacturing policy to ensure that domestic production capacity develop

JNNSM is going to open significant market for solar technologies.

India will have to again maintain fine balance between objective to increase installed

capacity at fast pace and improvement in domestic manufacturing capability.

ABPS Infrastructure Advisory Practical Solutions to Real Life Problems

ABPS Infrastructure Advisory

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Kirol Road, off LBS Marg

Kurla (West), Mumbai 400 070

Ph: +91 22 6124 0400/ 6124 0444

Fax:+91 22 6124 0499

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Sustainable Energy Development India Success Story...Shriram EPC WinWind Source: CWET Wind – 2/2 ABPS Infrastructure Advisory Private Limited Practical Solutions to Real Life Problems