Accountability of regulators a serious crisis in India: Goyal

Stating that accountability of regulators was a very serious crisis that the country was facing, Union Minister Piyush Goyal today said very often they are not even able to justify many of their decisions.
“The one very, very serious crisis that the nation is facing today is the accountability of regulators. There is almost no accountability of regulators. And in the garb of independence of regulation, it occasionally goes to another extreme,” the Union Minister of State for Power, Coal, New and Renewable Energy and Mines said.
He was speaking at a seminar on ‘Ease of Doing Business- Regulators as Facilitators’ at Vibrant Gujarat Global Summit 2017 here.Pointing at regulation of environment sector as a case in point, he said the sector suffered due to “over regulation as regulators are not able to justify many decisions”.

“The environment sector has suffered due to over regulation and very often regulators are not able to justify many decisions. So, you have a situation, where there is nothing like forest for an area called forest, no satellite image, no ground report says there is a single tree in that area,” he said adding that seeking building permission or regulatory permission for such areas causes a lot of trouble.

Attending the seminar were chairman of Food Safety and Standards Authority of India (FSSAI) Ashish Bahuguna, chairman of Competition Commission of India (CCI) Devendra Kumar Sikri, and chairman of Central Electricity Regulatory Commission (CERC) Gireesh Pradhan, among others.

“Transparency is another area, when we look at the regulatory process. Regulators should be open about their working, hearings should as far as possible be more and more in public domain, and speaking orders, with a logical approach, should be available in public domain so that others should benchmark their business process to whatever is decided by regulators,” he told the audience.

“And regulators should also be user-friendly rather than being under the shroud of what really was the intent of regulators and intent of law. Lastly, it is important to target regulation on what the problem is, so that we don’t tend to go haywire and over-exceed our brief,” Goyal said.

“If we can keep the side effects of regulations minimum, it can help make regulators truly a facilitator person and help economic growth. We can then have a situation where people are not fearsome of regulators, we have to get fear out of regulation,” he said.

“In that sense, policy makers and regulators should work hand in hand. You can’t have a situation, where policy makers and regulators think differently,” he added.

View original post on Business standard: http://www.business-standard.com/article/pti-stories/accountability-of-regulators-a-serious-crisis-in-india-goyal-117011101448_1.html

Has India’s Energy Sector Really Transformed?

SL Rao

Most importantly, Piyush Goyal, the Union Minister for Power and Renewable Energy, Coal, and Mines has cleared the coal sector’s Augean Stables, which were riddled with corruption, theft, and inefficiency. Coal is easily available today, imports have fallen, and global prices have fallen along with those of oil and gas.

Falling domestic demand has sent coal prices lower as well. Power is surplus despite power plants working at a low average plant load factor of 60 percent. But at the same time, around 30 crore people remain without electricity.

Does This Indicate A Transformation?

Not so much. On the positive side is the coal availability and price situation, increasing but still inadequate interstate transmission capacity, some reduction in transmission and collection losses.

But state-owned power distribution companies do not generate enough of their own funds to buy power from within the state or from outside. This is because tariffs remain uneconomical for the distribution companies.

States have violated the law that permits open access for distribution companies to purchase cheaper power from other states. Instead, they buy expensive power from within the state.

Ruling parties treat power as a public good which must be available to all, irrespective of their ability to pay. This has meant that power is given free or below cost to many households, for agriculture in many states, and to some other favoured consumers. Agricultural use of free or cheap power has led to a surge in water-intensive crops like rice and sugarcane, often on soil that is unsuitable. Outcomes range from saline soil to depleting groundwater and river water levels.

The government just ends up accumulating large stockpiles of rice. Compounding that, the Government of India has a minimum support price policy that encourages cereals even when the demand is falling. It has no relation to water availability and use for the crops.

There has been no improvement in gas supplies to operate stranded power generation capacity. Even when gas is available, demand may not be sufficient. Gas generation is flexible and can usefully back-up variable generation from renewables.

Renewable Energy And Efficient Appliances

Wind and solar renewable energy capacities have gone up significantly, as have some small hydro-electric projects. Governments incur subsidy expenditure in promoting renewable energy, but regulators have failed to enforce renewable energy obligations, resulting in a loss of revenue for the generators of clean power. State power distribution companies have not been compelled to meet renewable energy obligations in their total power supply mix.

Progress has been made on energy efficiency. The distribution of LED light bulbs has helped conserve a significant amount of power, as have other measures initiated by the Bureau of Energy Efficiency. This may well have resulted in some decline in demand for generated electricity.

UDAY Scheme: A Stop-Gap Fix

The power sector benefited from the Ujwal DISCOM Assurance Yojana (UDAY) scheme, which reduced debt on the books of state distribution companies by getting the corresponding state government to take over the debt. This, however, has not made any of the distribution companies profitable, but the saving in interest costs has freed some cash.

The UDAY scheme is the best that the Centre can do since electricity is a concurrent subject in the Constitution.

The scheme needs to be seen, not as a solution, but as short-term relief. Power distribution is a state subject, and ruling parties are populist about electricity pricing as they are able to woo large electoral voting blocs.

This is made possible via the appointment of state regulators who are mostly compliant, often from the community of retired bureaucrats who have served in the same state. Until regulators are appointed for their independence, courage, and lack of subservience to ruling governments, there can be little change in the dire financial position of power distribution companies.

It is apparent that fundamental change still eludes the power sector.

UDAY is merely transferring some distribution debt to state governments. It does not tackle the problem of below-cost tariffs and significant inefficiency caused by government ownership.

The only way state governments can indefinitely continue taking on power distribution debt as it accumulates, is via the annual budgetary exercise. But doing so will divert funds from vital state spending – on human capital, law and order, and the building of infrastructure.

There is no option but to charge users a tariff that is remunerative to the company.

Regulate Well, Build Capacity, Store Better

Regulators must have the authority to punish those responsible for below-cost tariffs, and delays in Aggregate Revenue Requirement filings. Transmission and distribution losses, poor collection, and theft of electricity must be targeted, monitored and failures severely penalised.

Interstate and intrastate transmission capacities are grossly inadequate. Governments are the primary investors in this space, more so because private investors are put off by long and frequent government delays, and the consequent costs.

Delays in giving government clearances on land, environment, forest and others have held up many a project, keeping out subsequent private investment.

While India is taking rapid strides in renewable energy, and there are heavy government subsidies involved, there is little investment in backup storage capacity to make up for a shortfall when there is no sun or little wind.

This storage can be of water, batteries or as flexible generation capacities in gas or coal.

In sum, the energy and especially the power sector in India has experienced an uncoordinated set of policies that have left this vital sector largely in government hands and running at a loss. Foreign investment is most unlikely in such a sector. The domestic investment that has taken place is not very profitable. Their supply is either confined to large users or use other means to cover costs.

Huge investment has been made in the power sector, but it needs more. The present surplus is artificial and not due to demand satisfaction, as much as to poor revenues. The energy sector must be approached in its entirety, policies must be integrated for the private as well as public sector to run it in a way that is remunerative.

SL Rao is a Distinguished Fellow Emeritus at The Energy and Resources Institute (TERI), and was the first chairman of the Central Electricity Regulatory Commission.

(This article was originally published in BloombergQuint.)

 

View original Post on: https://www.thequint.com/environment/2017/04/03/energy-sector-transformation-renewable

The UK’s electrical grid is so overrun with renewable power, it may pay wind farms to stop producing it

Generating electricity from the sun and wind is great for the planet, but the infrastructure necessary to deal with these intermittent power sources is tricky. Too much or too little power can upset the balance of the grid, which has to be finely tuned to keep the voltage of the electricity it delivers to customers stable.

Without a means of storing renewable energy or handling huge variations in production, too much electricity surging into the grid can damage appliances or even cause outages. This is the problem that the UK may face this summer, the country’s grid operator says. When electricity demand naturally falls during the summer months, it is thinking about paying wind farms to stop generating so much power.

For the past few years, the UK has been ramping up renewable-energy production—especially wind power—in order to reduce its carbon emissions. Government subsidies have also encouraged homes and businesses to install rooftop solar panels, which can bypass the grid altogether.

Meanwhile, National Grid, which manages the UK’s electricity network, has been trying to update its aging infrastructure. Ofgem, the UK’s energy regulator, estimates that payments to balance electricity generation when it gets out of whack—either too much or too little to meet demand, from both renewable and (mostly) fossil-fuel generators—ran to about £354 million ($540 million) in 2015, or less than 1% of energy bills.

This summer, National Grid estimates that maximum and minimum energy demand from utilities is likely to fall to an all-time low (paywall). Peak demand is predicted to be 35.7 gigawatts, compared with 37.5 gigawatts in 2015, and minimum demand to be 18.1 gigawatts, compared with 18.4 gigawatts in 2015.

The UK’s electricity consumption has been falling in recent years. Some of the decline was down to the financial crisis, in addition to increased energy efficiency at homes and businesses, according to a National Grid spokesman.

Reduced energy demand and more prevalent renewable power is a good combination for the climate, but a headache for grid operators. These staid businesses are scrambling to balance their grids in response to a rapid energy transition. In the meantime, they may have to keep paying some power plants for, in effect, not doing their job.

 

View original post on: https://qz.com/952827/the-uks-electrical-grid-is-so-overrun-with-renewable-power-it-may-pay-wind-farms-to-stop-producing-it/

Solar tenders, auctions slowing down in India: Report

While solar installations in India have picked up speed, tenders and auctions have been slowing down over the past couple of quarters, according to a Mercom Capital report. About 1.9 GW of solar power was tendered in Q1 2017 (1 GW of this was a retender) compared to 3.4 GW in Q4 last year. There was 1.3 GW of solar projects auctioned in Q1 2017 compared to 255 MW in Q4 2016. The slowdown in activity has been disconcerting to developers and manufacturers who have been gearing up for more activity based on India’s solar installation goal of 100 GW by 2022.

As per the target set by the government, India needs to instal 18 GW of solar power every year till 2022. If the government wants to meet its solar installation goals, the pace of tenders and auctions must pick up quickly. Companies, who have invested hundreds of millions to expand to meet the demand and build projects, are anxiously waiting for the activity to pick up.

 

According to the report, “Some of the reasons for decline in tender and auction activity include poor financial condition of distribution companies (DISCOMs), transmission issues, weaker power demand and increases in captive generation by commercial and industrial companies. DISCOMs that are continuing to struggle financially are not taking on new generation that is more expensive than coal, which is leading to curtailment of solar and wind projects as well as payment delays to developers.”

The World Trade Organization (WTO) ruling against India’s domestic content requirement (DCR) has resulted in continuous cancellations and postponements of planned DCR tenders.

“In some states, weak power demand is removing the urgency to speed up the pace of solar tenders and auctions. Increases in captive generation by industrial customers have compounded the situation since they are requiring less power generation from DISCOMs,” the report adds.

The recent record low bid of Rs 3.30 (approximately $0.494)/kWh at the REWA solar park auction is playing a big role in the slowdown of auction activity as government agencies and states are stalling to renegotiate PPAs that are more expensive than the bids received at REWA.

For DISCOMs, coal is still the cheapest option available.  According to Mercom’s December Solar Quarterly Report, DISCOMs have resorted to sporadic curtailment from some solar projects in Rajasthan and Tamil Nadu because cheaper power is available on the power exchanges. Even when there is demand, several states have complained that the DISCOMs are resorting to power cuts instead of buying power on the exchanges to save on costs.

Several other developers told Mercom that as of now Bihar, Jharkhand, Tamil Nadu, Rajasthan and Maharashtra are the problem states. According to Mercom’s Solar Project Tracker, tendering activity has declined in these states with most of the old tenders being continually extended.

 

“We hope this is a short-term issue which, once resolved, will see tariffs get down to realistic levels and there will be a big spurt in activity. However, if some of these pressing issues are not resolved quickly, growth will stall,” said Raj Prabhu, CEO of Mercom Capital Group. “There needs to be a policy mechanism put in place to avoid the stop and start in tender activity every time there is an outlier in terms of a low bid. However, if states revise their tenders to include all of the positive aspects of the REWA tender, it can be a win-win for all,” he added.

View original post on Business Today: http://www.businesstoday.in/

India plans Renewable Energy Management Centres for Green Corridors

Existing control centres, known as state load dispatch centres (SLDCs) currently lack renewable energy forecasting systems. Flickr: Tapas GaneshExisting control centres, known as state load dispatch centres (SLDCs) currently lack renewable energy forecasting systems. Flickr: Tapas Ganesh

As part of India’s Green Energy Corridor scheme, the Ministry of Power has proposed setting up a host of Renewable Energy Management Centres (REMCs) across the country to help integrate renewables as their penetration increases. The centres will cost around INR4.09 billion (US$63.5 million).

With a 160GW target of solar and wind by 2022, the ministry is concerned about grid stability and security. It noted that seven states will account for 104GW (65%) of this capacity including: Tamil Nadu, Andhra Pradesh, Karnataka, Maharashtra, Madhya Pradesh, Gujarat and Rajasthan.

The newly proposed REMCs would therefore be separated into the Southern, Western and Northern regions across the seven major resource rich states and various projects of the Green Energy Corridor scheme.

Existing control centres, known as state load dispatch centres (SLDCs) currently lack renewable energy forecasting systems, scheduling, monitoring and reserve management abilities.

To alleviate this problem, India aims to emulate state-of-the-art renewables forecasting and monitoring systems already successfully operating in countries like Spain, Germany, US, Denmark, Belgium and Australia.

The REMCs’ functions include:

  • Forecast renewable energy generation at state and regional levels
  • Schedule renewable generation with real time tracking and SCADA systems
  • Coordinate with the relevant load dispatch centre

Power Grid Corporation of India Limited (PGCIL) has already worked on similar control centre projects and has therefore been assigned the implementation role. On completion, PGCIL will hand the REMCs over to the states.

The projects are to be implemented within 15 months of award and commissioned progressively through 2018/19.

PGCIL recently entered in to a loan agreement of up to US$500 million with the Asian Development Bank (ADB) partly for one of its Green Energy Corridor projects.

View original post on: https://www.pv-tech.org/news/india-plans-renewable-energy-management-centres-for-green-corridors

All bets are off: 4 takeaways on what President Trump means for the power sector

The paradigm of decarbonization that’s guided utility sector investments for the past decade is now up in the air. How will the Trump victory impact other industries? Here’s what we know about the President-elect. 

After a long election night, the American public elected real estate magnate and reality TV star Donald Trump as the 45th president of the United States. The Republican nominee’s win shocked political commentators across the spectrum, as most election models predicted a victory for his Democratic rival Hillary Clinton in the hours before polls closed.

For the power sector, Trump’s election is likely an unwelcome development. U.S. utility companies gave more money to Clinton than any other candidate this election cycle, while none made sizeable donations to Trump. 

Much of that support came from the fact that Clinton is more of a known quantity to the power sector. Because they invest in multi-decade assets, utilities desire certainty and predictability out of policymaking, and the Clinton campaign laid out a full energy platform promising to build on the model of carbon regulation and renewable energy supports pushed by President Obama.

The Trump campaign, by contrast, was hard to predict: Beyond promises to roll back EPA regulations and support fossil fuels, he laid out few concrete energy policy proposals. And because energy and climate policy rarely featured on the campaign trail this cycle, the details of how a Trump administration would plan to transform U.S. energy production remain unclear. 

In the coming weeks, much effort will be spent trying to decipher who Trump will appoint and how his team will handle the specifics of energy policy. But given that President Trump will likely come into office with a GOP-controlled Congress and a vacancy to fill on the Supreme Court, there are some broad conclusions for the power sector that we can already draw. 

1. The Clean Power Plan — and other air regulations — are in danger 

One of the most immediate impacts of Donald Trump’s election is that the Clean Power Plan now appears much more likely to be struck down. 

The CPP is the EPA’s first set of federal carbon regulations and seeks to cut CO2 emissions from the power sector 32% by 2032. Though the utility industry is largely on board with the plan, a group of conservative states and fossil fuel interests challenged the rules, saying they constitute an overreach of EPA’s authority. 

Those arguments came to a head in September, when the D.C. Circuit Court held an en banc hearing on the regulations. Due to the composition of the court — six Democratic appointees and four from Republicans — legal experts largely expect the rules to be upheld there

But the Supreme Court could be a different story. No matter who prevails at the D.C. Circuit, the high court is expected to take up the Clean Power Plan next year. The justices have already shown interest in the case, placing an unprecedented judicial hold on compliance until court challenges are concluded. 

After Justice Antonin Scalia’s death earlier this year, the Supreme Court has a vacancy, and Republican senators have refused to confirm President Obama’s nominee, Judge Merrick Garland.

If the Supreme Court were to hear the Clean Power Plan case with one seat vacant, energy lawyers told Utility Dive that a 4-4 split would be plausible, which would uphold the D.C. Circuit decision. But if Trump puts another conservative on the court — as he has promised — it could potentially give CPP opponents the five skeptical judges they would need to overturn the Clean Power Plan. 

Given that Trump will come into office with a GOP-controlled Senate, that judicial outcome is now much more likely. But even if the Supreme Court upholds the plan, a Trump administration and Republican Congress could still scuttle it by defunding the agency or simply halting implementation work. 

And while the Clean Power Plan is the highest-profile EPA air pollution rule at risk in a new Trump presidency, it is not the only one. Fossil fuel interests still bristle at rules like the Mercury and Air Toxics Standards (MATS), which regulates harmful coal power pollution, and the EPA’s new source pollution rules, which govern emissions from new power plants. 

Trump has indicated that he wants to overhaul the EPA. With him in the White House, the future of any clean air or water regulation remains uncertain. 

2. Renewable energy subsidies could be on the chopping block

EPA regulations are a relatively easy way for Donald Trump to weaken President Obama’s clean energy legacy, since many of them are facing current court challenges or could simply not be enforced. 

Renewable energy subsidies would take more of an effort to revoke. At the end of last year, Congress reached a deal to extend supports for wind and solar energy into the early 2020s, with subsidy levels decreasing over time. That tax credit extension is fueling a boom in deployment, with renewables expected to add the vast majority of generating capacity for the remainder of the decade. 

That could change quickly. Though Trump hasn’t laid out a policy position on renewable subsidies, wind and solar have been the target of frequent ridicule from the president elect. In one speech designated for energy policy, Trump lambasted solar energy as “very expensive” and accused wind turbines of “killing all the eagles.” 

Because the renewable energy supports are already in place, revoking them would take a legislative effort. That’s a heavier lift than in the past, since many Republican officials have renewable energy facilities or manufacturing in their states, boosting support for the industry among conservative lawmakers. 

But there’s also appetite in some circles to get rid of renewable energy subsidies altogether. Some fossil fuel and nuclear generators complain that the production tax credit for wind lets these facilities to bid into the market at lower prices, pushing down electricity prices and preventing their baseload plants from competing. 

If Trump’s energy team will listen to clean energy opponents remains to be seen. The president elect has also said he is “for” renewable energy on many occasions, even while criticizing it in the next breath. But whether he opts for a full-frontal attack on wind and solar subsidies or will simply turn his attention to boosting fossil fuels, the future for renewables in a Trump administration does not look as bright as it would under a Clinton administration. 

3. Fossil fuels will likely get a boost

If Donald Trump has sent mixed messages about renewables, no one can mistake his support for fossil fuels. 

Trump made the plight of the fossil fuel worker a centerpiece of his campaign, lambasting EPA regulations he claims are “destroying our energy companies” and promising to put coal miners, oil drillers and power plant operators back to work. 

As elsewhere, the details of how Trump would do that are scant, but he has promised to increase U.S. production of oil, natural gas and coal.

Energy analysts point out that’s likely impossible, since coal’s decline in the U.S. is chiefly attributable to competition from cheap natural gas. But there are things Trump could do to open up new production areas, such as lifting restrictions on offshore drilling and fossil fuel production on federal lands. 

On the flip side, a Trump administration is likely to rebuff any environmentalist efforts to restrict domestic fossil fuel production or transport — a recent priority for green groups, which have sought to halt the expansion of oil and gas pipelines. 

Taken together, those two factors mean a much friendlier market for U.S. fossil fuel extraction and the generators that burn that fuel, even if the details are yet to be filled in. As one industry analyst told the Wall Street Journal this morning, “U.S. oil companies have a better future today than yesterday.” 

4. The paradigm of decarbonization may shatter

More important than any particular policy proposal is the paradigm shift that Trump’s election represents for the power sector. 

For the past few years — particularly since Obama’s reelection — the narrative for the future of the U.S. power sector was clear: Utilities would have to decarbonize their power plant portfolios quickly, first turning to natural gas as a bridge from coal and then ultimately to a greater reliance on renewables, energy efficiency and advanced technologies like storage. 

The Clean Power Plan underpins much of this narrative, pushing the states with the most coal power to shift to cleaner sources in the coming decades. Through those rules, the Obama administration sought to show the world the U.S. was serious about combating climate change and provide a stable policymaking environment for utilities to make investments. 

With the world’s largest economy committed to decarbonization, over 190 nations signed a landmark climate accord in Paris last year to limit global climate change to 2 degrees Centigrade this century. And not only did U.S. utilities sign on to support the CPP in court, they began using the temporary extension of wind and solar tax credits to make unprecedented investments in renewables. 

For the first time, it appeared a new climate consensus was forming — that U.S. and global policymakers not only accepted the realities of global warming, but were seeking to craft international efforts to stop it. 

Now, that consensus may be gone. Trump has said he would pull the U.S. out of the Paris accord and openly disavows the concept of human-caused climate change, once calling it a hoax perpetrated by the Chinese government. How Trump’s election affects other nations’ decarbonization plans remains to be seen, but his disavowal of climate policy creates deep uncertainty for the power sector. 

From plants to pipelines, utility assets last for decades, meaning the investments companies make in the next few years will shape the power mix for decades to come. Under the CPP and current renewables incentives, most U.S. utilities are opting to replace retiring coal plants with wind and solar facilities.

But without those programs, the investment situation may start to look different for many utilities. Whereas Hillary Clinton was likely to build upon existing regulations on power sector pollution, the promise of less stringent rules could increase the appeal of fossil fuel assets. 

If that happens, it could scuttle any remaining chance of meeting the Paris Accord. Already this year, Oxford researchers estimated if we want to meet the 2 degree goal, “no new investment in fossil electricity infrastructure (without carbon capture) is feasible from 2017 at the latest.” Given that the transport and industrial sectors continue to increase emissions, researchers said that “2 degree capital stock” is likely already depleted. 

In other words, scientists say the world is already behind the needed trajectory of emissions reduction to meet the Paris goal, and investments in more long-lived fossil fuel assets could commit the world to see the most catastrophic consequences of climate change if they are not retired early. 

But it may not all be bad news for renewables. Wind and solar have come down precipitously in price over the past decade, and energy storage costs are declining quickly as well. Even with Trump in the White House, renewables will likely continue to enjoy strong growth and grow their portion of the U.S. power mix. 

Even if that’s the case, wind and solar growth in the U.S. can’t make up for the possible end of a global climate consensus and the enhanced appeal of fossil fuel assets at home and abroad.

Unlike political paradigms, the scientific one won’t change when Trump walks into 1600 Pennsylvania Ave. on January 20.

View original post on:

India Wavers on Emissions as Power Plants Balk at Price Tag

India may ease a deadline to cut pollution from coal-fired power plants blamed for causing the world’s worst air quality amid pressure from generators who say it’s too difficult to implement the $37 billion reforms.

The deadline to meet all the new standards may be pushed back beyond the original December 2017 target, said S.D. Dubey, chairman of the Central Electricity Authority and head of the panel drafting the road map for power producers to meet the new guidelines. Prime Minister Narendra Modi’s government proposed the limits on toxic emissions in December 2015.

The delay highlights the challenge facing Modi’s administration to provide cleaner air alongside affordable and reliable power to all of the country’s 1.3 billion people. Limiting emissions would take longer than the government’s original two-year deadline and cost as much as 2.5 trillion rupees ($37.4 billion), the Association of Power Producers, a lobby group of non-state generators, said in March.

The new goals may be implemented “in a phased manner,” Dubey said in a phone interview. “Particulate matter emissions should be addressed in the first phase. The next step would be sulfur dioxide emissions and later on oxides of nitrogen. That’s the direction we are moving in.”

The office of Federal Environment Secretary A.N. Jha, whose ministry originally proposed the standards, didn’t respond to e-mails seeking comment.

India’s 187 gigawatts of coal-fired power capacity, which generate more than 75 percent of the nation’s electricity, contribute to the air pollution that makes India home to what the World Health Organization has determined are 11 of the top 20 cities on the planet with the worst air quality. The plants account for 61 percent of its generation capacity, according to the Central Electricity Authority.

India must first establish monitoring systems at all plants to establish an emissions baseline, determine what technologies will be appropriate and then install them at the plants, said Leslie Sloss, an analyst with the IEA Clean Coal Centre, a technology cooperation program of the Paris-based International Energy Agency.

“The time frame for the new norms is extremely challenging and probably not possible in practice,” Sloss said. “The new norms equate to India complying with emissions standards within a few years that Western economies have worked up to over decades. ”

Coal-fired power plants contribute to the release of about 60 percent of India’s industrial particulate matter, as much as half of the sulfur dioxide and 30 percent of oxides of nitrogen, the New Delhi-based Centre for Science and Environment said in a report in December, weeks after the new standards were announced.

“The emission norms require capital expenditure, which will lead to an increase in tariffs and burden the already weak financials of state power retailers,” said Sachin Mehta, an analyst at Mumbai-based Centrum Broking Ltd. “The plan is fraught with challenges. It is impossible to meet the current deadline.”

View original post on:

http://www.bloomberg.com/news/articles/2016-11-02/india-wavers-on-emissions-goal-as-power-plants-balk-at-price-tag

Encouraging Potential for Self- consumption of Solar PV in Germany

solar

A report from the independent German think-tank Agora Energiewende(Agora) has concluded that projected increases in self-consumption through solar PV power systems in the country does not mean upsetting dynamics of the nation’s renewable energy surcharges.

The study outcomes have been welcome news to advocates for Germany’s enviable transition to clean power (referred to as ‘energiewende’). Recent figures show German solar PV capacity of over 40 GW (38.5 TWh) — providing 7.5 percent of Germany’s net electricity consumption through 2015.

There is an underlying concern addressed by the study. Matthias Deutsch, senior associate at Agora, told Renewable Energy World: “An on-going controversy in Germany surrounds the potential and consequences of self-consumption. Some people argue that large-scale up of solar PV — this rise in prosumers — means putting at risk the solidarity of the grid, because people are contributing less to the fixed costs of the system.”

A broad effect of this is thought by some to be reflected in increasing surcharges imposed by the German Renewable Energy Sources Act (EEG) on the kWh price of electricity paid by consumers and increases in grid charges, as trends for autonomy from the grid continue.

On the basis of the study’s findings, Agora observed that through 2035, albeit projecting considerable expansion, “self-consumption of solar PV will play only a secondary role in overall electricity consumption.”

The report concludes: “From today’s perspective, self-consumption poses no risk of quickly eroding the funding base of Germany’s EEG surcharge or network charges.”

Dr. Patrick Graichen, executive director of Agora Energiewende, stated: “There’s simply no reason to fear that a solar power boom will have everyone generating their own power. Even if every eligible homeowner installed a rooftop solar array overnight so they could generate their own power, the EEG-surcharge would only increase by a maximum of 0.5 cents per kWh.”

Figure 1: Development of renewable energy capacity in Germany. Credit: Agora Energiewende.

Providing further insights, Deutsch said: “The potential of self-consumption determined by the study is relatively low. Importantly, even if the price of PV energy storage systems continues to fall rapidly, growth of these systems in energy terms will remain gradual, so the impacts on EEG surcharges would not be too great.”

He added that the study is good news for the solar PV industry, and provides substance to the on-going debate about how to support and manage self-consumption in Germany.

“This is important, of course, since more and more PV storage systems for self-consumption are being offered in the market, and as we see in the report, this market is set to continue expanding,” he said.

The study considered solar PV potential over two distinct sectors: residential (single- and two-family homes) and commercial.

It found that potential residential self-consumption amounts to between 4.6-38.6 TWh per year by 2035. The upper figure was calculated with contribution of energy storage systems included; and the authors noted that there are reasonable grounds for adopting this projection.

However, since not all of this energy is conventionally supplied by the grid (notably due to solar PV powering novel heating applications) the amount of energy that self-consumption may offset in terms of grid demand is less, around 20 TWh.

In the second sector considered by the study, commerce, trade and services, the authors concluded: “We found considerable potential for self-consumption: around 3.8 TWh per year, or just under 3 percent of total electricity demand in the sector, is economically feasible.”

Altogether therefore, Deutsch said that “overall, self-consumption may lead to reduced energy use from the grid of around 24 TWh per year. This represents about 5 percent of today’s net electricity consumption.”

Correspondingly, this potential would affect Germany’s EEG surcharge only moderately: a rise of around 0.5 euro cents (US$0.55) per kWh. While EEG surcharges and other components of power prices have risen in recent years (see figure 2), Deutsch points out that the increase wouldn’t be significant.

He emphasised the hypothetical nature of this calculated increase: “This increase refers to an instant realization of the total potential for self-consumption [that] we expect to unfold only gradually in the future. At the same time, other factors will tend to reduce the EEG surcharge.”

Figure 2: A break-down of recent years’ electricity prices in Germany reveals multiple components. Credit: Agora Energiewende.

Figure 3: The future costs of supporting renewable energy in Germany (in billions) suggests that even promising development of solar PV will not overwhelm the national support system. Credit: Agora Energiewende.

Beyond assurances, the report recommends that the German government now look towards delivering a stable regulatory framework that encourages self-consumption via solar PV.

Previous regulatory amendments, comments Deutsch, have been counter-productive and sent mixed signals to the industry and prosumers.

“While the 2009 version of the EEG featured a bonus scheme for self-consumption; [in contrast] the 2014 revision introduced additional charges,” he said.

Contradictory stances have also been expressed towards the nation’s energy storage support schemes.

He concluded: “Instead of such mixed signals from policy makers, we need to develop a forward-looking system of levies and fees, which includes owners of private property and their tenants in the overall costs of the system; and which ensures that future changes in legislation do not retroactively devalue investments in on-site solar power.”

Lead image: The Solar Settlement project in Freiburg, Germany. Credit: SA 3.0

 

View original post on:

http://www.renewableenergyworld.com/articles/2016/11/encouraging-potential-for-self-consumption-of-solar-pv-in-germany.html

Renewables could lose European power grid priority, documents reveal

Industry concern after confidential impact assessment models scenarios for paring back the ‘priority dispatch’ system for clean energy

The sun reflects off a solar collector assembly at the Andasol solar power station, southern Spain. Retroactive changes to funding rules have caused disputes and cutbacks in several countries, notably Spain.

 The sun reflects off a solar collector assembly at the Andasol solar power station, southern Spain. Retroactive changes to funding rules have caused disputes and cutbacks in several countries, notably Spain. Photograph: Marcelo Del Pozo/Reuters

Paring back the “priority dispatch” system could increase carbon emissions by up to 10%, according to a confidential EU impact assessment seen by the Guardian. But the document goes on to model four scenarios for doing just that, in a bid to make Europe’s energy generators more flexible and cost-competitive.

Some industry sources have told the Guardian they are alarmed and think it highly likely that priority dispatch for clean energy will be scrapped from the EU’s renewable energy directive, which is currently being redrafted for the post-2020 period.

Oliver Joy, a spokesman for the WindEurope trade association, said: “Removing priority dispatch for renewable energies would be detrimental to the wind sector, which would face more curtailment across the continent. It also seems to be at odds with Europe’s plans to decarbonise and increase renewables penetration over the next decade.”

“Investors took priority dispatch into account when projecting revenues in the original investment decisions, and it could have a bearing on existing projects if they are not protected from the change.”

The issue of retroactive changes to funding rules for renewables in Europe has been a cause for disputes and cutbacks in the wind and solar sectors of several countries, notably Spain.

Senior industry sources say they will push for financial compensation and access to balancing markets to help prevent a significant industry contraction, if priority dispatch is ended.

“We have had enough instability and retroactivity in Europe and going forward, the difference between existing and future assets should be well distinguished,” said one industry source.

“I would be extremely worried if they just removed priority of dispatch and did not touch other key issues around market design. It would mean that the commission was taking measures against the same renewable industries that they defend in public.”

Fossil fuel power providers argue that renewables have the lowest operating costs and so would anyway receive priority access to the grid network.

They also say that taking the clean energy sector out of priority dispatch would prevent “negative prices” – where more energy is produced than can be sold – and eliminate anti-competitive subsidies.

The EU’s assessment views the abolishing of priority dispatch as a step towards the creation of a “level playing field” for energy generators.

But without such a system, renewable sources may be the most likely to be taken offline because of the relative ease of switching off a wind turbine compared to a coal or nuclear plant.

The energy source with the lowest marginal cost – almost always renewables – is usually the first in line to be shut down by power grid operators.

As things are, a Europe-wide trend towards ending financial support has constrained the forward march of renewables on the continent, and siphoned off investment to elsewhere in the world.

“Everyone is investing in renewables outside Europe right now,” said one industry source. “If you want to bring investors back you have to send very relevant signals.”

Removing wind and solar power from priority dispatch may be intended to help reform the capacity market system, which currently pays gas generators to remain idle. Ironically though, it could lead renewable generators to demand an extension of the same mechanism to their own sector.

“If priority dispatch is removed, then renewables must be given a fall-back option of access and renumeration in the balancing markets to help stabilise the system, or clear levels of compensation in the event that curtailment is necessary,” Joy said.

Priority dispatch is supposed to be mandatory under current EU rules, although the UK, Sweden and the Netherlands are among countries that do not comply.

The study says that “the biggest impacts on generation [from ending priority dispatch] would be observed in Denmark, Great Britain and Finland, where biomass holds a large share of generation capacity”.

But this would be felt more in terms of bioenergy’s “expensive” production costs than its carbon emissions reduction potential, which is disputed inside and outside the commission.

“The removal of priority dispatch for biomass would indeed, in the first instance, imply an increase in GHG [greenhouse gas] emissions,” the paper says.

The four scenarios for scaling back priority dispatch involve an increase in CO2 emissions of 45m-60m tonnes.

 

View original post on : https://www.theguardian.com/environment/2016/nov/01/renewables-could-lose-european-power-grid-priority-documents-reveal

Surplus power: An opportunity beckons

title=
Representational image (Photo: Getty Images)

India is witnessing a strange paradox. Providing electricity to ensure one light and a fan to the poor is in itself a big deal, and amidst tall government claims, many villages in the country are still not electrified or despite installation of electricity poles, remain powerless. Under these circumstances, the Central Electricity Authority, under the Ministry of Power, has come out with a report, according to which there will be 1.1 per cent surplus power in 2016-17.

Surplus or deficit power is seen in terms of power supply and demand throughout the year. If demand for power is greater than its supply, it would be considered deficit of power; where supply of power is more than its demand, it would be called a power surplus situation. In fact, this is the first time that we have surplus power, according to government statistics. The situation does give satisfaction, but it poses a problem as well. Due to surplus power, power plants are under stress because of lower demand and lower prices in view of competition. The important question is whether this challenge can be converted into an opportunity.

While analysing the reasons for surplus power, experts opine that demand for power is estimated from the people connected to the grid. However, a large number of people are still not connected to the grid. If we add the prospective demand from those deprived of electricity so far, then this surplus will vanish. As per international comparisons, India’s per capita consumption of electricity is among the lowest in the world. India’s per capita electricity demand is 1070 kilowatt hours, while the global average is 3026 kilowatt hours. Among BRICS nations, India is at the bottom in terms of per capita electricity consumption. Due to lower incomes, people have lower purchasing power and therefore they consume less electricity. However, electricity demand is on the rise year after year. In 2014-15, electricity demand increased by 6.6 per cent and in 2015-16 by 4.2 per cent. The government is making efforts to increase the capacity to generate more power, to facilitate availability of power for an increasing population. By August 2016, the total capacity was 306 Giga watts. Today total production of electricity is 1108 billion units from utilities and 166 billion units from captive power plants.

It is satisfactory that we have surplus power and there are few possibilities of power cuts. However, we still have 3.2 per cent power deficit during peak hours. The current government pats itself on the back for the surplus power. However, CEA has estimated that though we have surplus power in the southern and western parts of the country, there is still power deficit in the eastern and northern parts of the country.

Power deficit was a major problem in India till some time back. However, the situation of electricity surplus is no less challenging as electricity producing units will have to sell electricity at un-remunerative prices and therefore may incur huge losses. As a result, future capacity generation may get adversely affected if electricity generation becomes a loss-making business. The last three years have seen 77636 megawatts (MW) of installed capacity in power generation.  Due to the efforts of the present government, especially the Prime Minister, significant strides have been made in solar power and there is a great future for it in the country. Therefore, it is essential that we are able to maintain a balance between demand and supply of electricity in the country.

Even when faced with power surplus, we are still using a large amount of petroleum products for transportation and cooking. A huge amount of LPG is being imported for cooking. If we are able to produce enough electricity, would it not be appropriate to promote use of electric stoves. All over the world due to environmental hazards, people are turning towards electric vehicles. While going fast on solar power generation, the Prime Minister has set a target for reducing petroleum imports by at least 10 per cent. If we are able to achieve this target, the country will be saving at least US $10 billion to 12 billion. Today, India is the fourth largest oil importing country of the world. So, a reduction in imports may also cause further reduction in the prices of petroleum products globally. We may not only be moving towards energy security, the commitments made in the Paris Deal may also be achieved faster.

Due to power surplus and fast increasing electricity generating capacity, India has also started exporting electricity, though in small quantities. We are exporting electricity to Bangladesh, Nepal and Myanmar. Electricity exports to Sri Lanka are under process by laying a cable under sea. Therefore, we can say that in times to come, India may not only be self-sufficient in electricity, it may even be exporting electricity to neighbouring countries.

Riding on electricity surplus, by increasing the use of electricity in cooking and transport, we may not only be protecting our environment, even costs may come down. On the one hand we may be able to reduce our oil import bill, and on the other, earn valuable foreign exchange. However, for converting the challenge of surplus power into an opportunity, we will have to keep a close eye on the scenario, so that the targets of electricity generation are not hit due to lower prices of electricity.

Read more at http://www.thestatesman.com/news/opinion/surplus-power-an-opportunity-beckons/173494.html#mxhR8fglvMcjXCek.99