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Cover Story | April 2012

Remove Section 11 ban on export of energy

In view of the ban, Tamil Nadu could have got at least Rs 750 crore last year if excess energy was sold outside the state, K Kasthoorirangaian, Chairman, Indian Wind Power Association (IWPA), informs R Srinivasan.

Tamil Nadu, with an installed wind power capacity of about 6,000 MW, or about 40 per cent of the country’s capacity, has a
preeminent position in the wind power industry and despite competition from other states is a much preferred location. But of late evacuation issues ail the state. The IWPA Chairman spoke to us about elements that make up the issue and what needs to be done. Excerpts of the interview:

Kindly comment on the evacuation issue scenario in Tamil Nadu.
Tamil Nadu, up to March 2011, had installation of 6,007 MW of windmills. May be by March end this year we would have added another 800 - 1,000 MW over and above that 6,007 MW. One has to understand the characteristics of wind blowing to estimate and evacuate wind energy. A windmill depends on the velocity of wind to maximise its generation. So continuous and consistent winds are necessary and this can happen only in the high wind season [for India] between April and October. Wind is unlike thermal power. A thermal power generator can deliver power to the grid continuously at a fixed MW level but because a wind mill depends on the velocity of the wind which keeps fluctuating, it cannot deliver power that is always constant so there will be some fluctuations.

In Tamil Nadu the peak that was delivered by windmills last year was 3,000 MW in a day. Wind is a by-product of sun’s energy. The sun starts with delivering zero energy at sunrise, goes to maximum by midday and then slowly declines to zero when the sun sets. Sun heats the air around the earth and the hot air tends to move to a cooler place. Such movement is called wind. Similarly the wind starts with zero energy in the early morning, the energy it gets from the sun increases and it comes to a maximum by mid-day or past mid-day. It takes time for sun to heat air and then slowly declines during sunset time and winds prolong for another two to three hours depending upon the intensity of the sun during the day. So the energy given by the sun to the wind and wind to electricity is something like a sinusoidal wave of our alternative current. So far as Tamil Nadu is concerned it gets around 1,500 MW by around 10 - 11 am. By 11, the Tamil Nadu windmills will be capable of delivering enough energy to meet the Tamil Nadu demand. But it will still be escalating after 1 or 1.30 and between 11-1.30, Tamil Nadu will be getting more energy from wind that it ever needs for the day. So there is excess energy. Then such excess energy generation will go on till 6 pm in the evening. By 6 pm Tamil Nadu gets more load, because streetlights and houses have to be lit so it will absorb the entire energy. So between (morning) 11 and 6 (evening) Tamil Nadu has excess wind energy. That could be used for the HT industries, which are starving with 20-40 per cent power cuts. The power cut has to be relaxed within the state for getting additional load or alternatively if they cannot change the rules for rations for the HT industry during different parts of the day, they should sell the excess energy between 11 and 6 outside the state.

Last year because there was the Section 11 ban on export of energy to outside the state and in spite our request the state government would not remove the ban, Tamil Nadu Generation and Distribution Corporation (TANGEDCO) could not evacuate and sell the energy outside the state though companies like Tata Power Trading wanted to buy that power. So the excess wind power was not evacuated and sold - resulting in a sizable number of wind mills being cut off from the grid. So it is not only because of the inadequacy of evacuation in infrastructure, but also because of the policy and flaws in management by the authorities handling power evacuation. These are the two reasons.

To what extent will ‘transmission superhighways’ enhance connectivity and disperse power from generation projects? Also Tamil Nadu’s transmission utility, TANTRANSCO, wants to beef up the state infrastructure. So how much will be required to improve the grid in TN?
Talking of the ‘transmission superhighways’, the Southern grid still stands most adequately connected to the national grid. The 765 kV line super highway to the national grid has not been established so far. It is still in the planning stage. Neither PowerGrid Corporation of India nor the government have done it. They do not have a time-related programme for doing it. It might help evacuate all the excess energy when it is available. During parts of the day when excess energy is available it could be pumped to the north and upcountry parts of India. Even to evacuate within the state we need 400 kV sub-stations and transmission lines from places of generation to the central grid. Now there is a central grid laid by PowerGrid Corporation of India from Kundankulam to Tirunelveli and Salem. This is the one which is helping to evacuate a sizable quantity of wind power within TN.

But Tamil Nadu Transmission Corporation (TANTRANSCO) which is supposed to have been the agency on behalf of the government to provide such evacuation infrastructure has not done its job. It is nearly two years since Tamil Nadu Transmission Corporation (TANTRANSCO) has applied for money. I believe the estimate [to improve the grid in Tamil Nadu] is around Rs 4,380 crore for which TANTRANSCO had applied to the Central government. The Tamil Nadu Electricity Board (TNEB), Tamil Nadu Generation and Distribution Corporation (TANGEDCO) and TANTRANSCO have about Rs 53,000 crore of debt and yearly increase in debt is like Rs 10,000 crore. Yet for nearly the last eight years they have not increased power tariffs for political reasons. Only this year they have mooted that and they say that by next week there is likely to be a tariff increase announcement and next year they can be financially better.

About Rs 50 a ton ‘green cess’ is levied on thermal coal and this money accumulates in a clean energy fund administered by the finance ministry. Almost Rs 10,000 crore of money is accumulated therein. The Central government is supposed to provide money from that fund to entities like TANTRANSCO to put up evacuation infrastructure. But they are delaying so badly in spite pressure from Tamil Nadu and from organisations [like IWPA] that are pressurising the central ministry to provide money to the needy people. One thing is inadequacy of energy infrastructure and inadequacy of money for the parties who have to put up evacuation infrastructure.

Even with existing infrastructure the state government and TANTRANSCO should work in such a way that the existing infrastructure is put to best use. That they have not done during 2011. The loss as we estimate is something like 3,000 million units during the 2011 wind season. Only during the high wind season power cannot be evacuated. During the low wind period like November to April there is not adequate generation and whatever little energy is produced by the windmills gets absorbed.

During the high wind season only we waste a lot of energy. If TANGEDCO had evacuated excess energy between 11 am - 6 pm and sold it outside the state they would have got at least Rs 750 crore last year. They could get more this year if they really act. For that the Section 11 ban on export of energy to outside the state should be removed.

We have been requesting the Energy department of the Tamil Nadu government, all along for removal of the ban.

What is the way ahead for other states that, in future, will adopt wind energy?
Energy could be better managed in Tamil Nadu. For the past six months from the end of the wind season to now, we outside Chennai are facing 8 hour power cuts, power cut up to 40 per cent for HT industry and two days a week there is no electricity.

Similar situations should be avoided in emerging states like Gujarat and Andhra Pradesh by planning and creating evacuation infrastructure in advance.

Why was the grid evacuation issue not anticipated?
It is two years since TANGEDCO has applied to the central government but funds have not been released. That is one of the issues. Every year 800 - 1,000 MW of windmills is getting installed in Tamil Nadu so that should be anticipated. It is the responsibility of the state and central government to plan and install ahead. Because of apathy of the authorities concerned, the windmills in the state were put off the grid, nearly 3,000 million units of precious energy were wasted during the high wind season and in Tamil Nadu, the amount of wind power used by the state last year amounts to 8,794 million units or 15 per cent of the total power consumed.

What would you suggest to augment the grid?
PowerGrid Corporation and similar agencies will have to connect the Southern grid with the national grid in a faster way. They have planned for 765 kV DC transmission lines from southern to northern grid to Maharashtra. That should be accelerated and completed. Full evacuation from windmills to the main grid as mandated by CERC should be done.

We need about 4 nos of 400 kV substations and 200 km of 400 kV transmission lines, another about 100 numbers of 230 kV sub-stations and other commensurate 230 kV power transmission lines - all that has to be created.

We, as an industry, not only install windmills but also put up sub-stations and the substation which are 110 kV and 230 kV to collect energy from windmills to Tantransco grid. From such a substation, taking power to the power grid or the highway is a duty of the government. Even in the Electricity Act such a transmission corridor is supposed to have been provided by the government.

The Electricity Act 2003 encourages more players besides government in generation and distribution. In TN there are more players in generation. There should be many players in distribution also in the same area like in Bombay, where you have TATA, Reliance and MSEB. Consumers too have a choice to buy energy from any one of them. In Tamil Nadu we have only one utility.

So bringing in private distributors is a must which TNERC has to look to. It is what the Electricity Act 2003 envisages. If you want the cost to come down and services to improve, privatisation is a must in this country.

Is there some way to evacuate this excess power?
First thing they have to do is throw away the export ban on energy - with a single order. Before 1991 India did not encourage exports, nor allow imports. Our foreign exchange position went bad. Then it was liberalised, imports were allowed and exports became simple. Now India is exporting – around $300 billion worth of exports. We get enough foreign exchange. Energy has to be liberalised. There should be no ban. In those parts of the day when Tamil Nadu has excess energy, it [energy] has to go to other parts of India and when Tamil Nadu has a shortage of energy like from 6 am - 11 am it has to buy. If the state gets Rs 750 crore in the afternoon and if it spends part of the money around Rs 200 crore in the morning, around Rs 550 crore will be net and Tamil Nadu need not have power cuts in the high wind season. That is power management. So it should be a two-way traffic.

When you have excess you sell it and when you have a shortage, you should buy. Tamil Nadu has excess power from 11 am – 6 pm and shortage from 6 am to 11 am. So there needs to be better management of energy.

Even if the funding problem is solved, it may take at least two years for a robust transmission infrastructure to come up. What are the short-term solutions?
Both the state and central government and the people in authority have to realise that people need adequate electricity.
For development, electricity is inevitable and everybody should work in a positive way so that things happen on time. Now things are prevented from happening not only because of inadequacy of money but also inadequacy of commitment/will to help people to get electricity. Every person in power has a duty to help people in the state and the country.

There should be no further delay in allotment of money from the clean energy fund and infrastructure has to be created on a war-footing. Removal of the ban on export of energy and better energy management by Tangedco are short-term solutions.

About IWPA

The Indian Wind Power Association (IWPA) was set up in 1996 as a non-profit organisation. The association, which began with 37 members, now has 1,100 members spread all over India. The national office of the association is located at Chennai and it has regional offices at Delhi, Jaipur, Mumbai, Ahmedabad, Hyderabad and Bengaluru. Since its inception it has worked consistently to remove barriers to wind power development and create an enabling regulatory and policy environment for investments in to this sector. The association is working closely with the Indian Renewable Energy Development Agency, Ministry of New and Renewable Energy, Ministry of Power, Ministry of Environment, Confederation of Indian Industry, state utilities, State Electricity Regulatory Commissions etc.
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